According to Bifotad.com, the administration of President Muhammadu Buhari has declared that it will start gradually removing the petrol subsidy in the second quarter of 2023.
In her report, Zainab Ahmed, the Minister of Finance, Budget, and National Planning, made this statement, noting the World Economic Forum’s side events in Davos, Switzerland.
This online media platform is aware that the federal government’s original schedule was for the subsidy removal to start in June after an additional 18 months. Ahmed pointed out that the withdrawal of the petrol subsidy would now start in April 2023, starting nearly three months earlier than the original schedule for putting an end to the expenditure head.
She asserts that the removal of subsidies appears to be the stance taken by every presidential candidate vying to succeed the current administration.
She stated: “What will be safer is for the current administration to, maybe at the beginning of the second quarter, start removing the fuel subsidy, because it’s more expedient if you remove it gradually than to wait and move it all in one big swoop”.
For the period of January through June 2023, the government had budgeted N3.35 trillion for fuel subsidies; however, the development had sparked intense debate over the necessity of such an expenditure because it would increase the FG’s budget deficit, which would require additional borrowing, driving up the country’s public debt, which as of the end of September 2022 was N44.06 trillion.
Removing fuel subsidies is one of the fiscal reforms that are urgently required, according to the World Bank and the International Monetary Fund (IMF), to improve Nigeria’s development outcomes, which are badly hampered by the wasteful use of resources.
World Bank President, David Malpass, said: “Nigeria’s government urgently needs to strengthen fiscal management, create a unified, stable market-based exchange rate, phase out its costly, regressive fuel subsidy and rationalize preferential trade restrictions and tax exemptions.”