We'll Continue to Borrow, since Nigerians Reject Fuel Subsidy Removal – Presidency


Alt: = "Femi Adesina"

Special Adviser on Media and Publicity to President Munammadu Buhari on Wednesday said that the Buhari led Federal Government has no option than to continue borrowing to finance fiscal overhead, since the Nigerian citizens are kicking against subsidy removal on Premium Motor Spirit, otherwise known as petrol. 

He disclosed this while featuring on a program on Channels TV.

“Head or tail, Nigeria will have to pay a price,” he said. “It’s either we pay the price for the removal in consonance and in conjunction with the understanding of the people, but if that will not come, the other cost is that borrowings may continue, and things may be difficult fiscally with both the states and the Federal Government.

“You know how much could have been saved if the subsidy was removed and how it could have been diverted to other areas and spheres of national life. But if you do not go that way now – and I agree that it may not be auspicious to go that way, then we have to pay a price.”

This government has being embarking borrowing both from domestic and foreign sources. 

Senate had last year approved some loan requests by President Muhammadu Buhari, which included the approval of $6.1 billion requested in July, and also the $16,230,077,718 and €1,020,000,000 loan request made in November.

According to Adesina, oil prices have been fluctuating globally for years as a result of one reason or the other, particularly due to COVID since 2019.

He stated that the price witnessed a decline as low as $30 per barrel, but later rose above $80 per barrel.

The Group Managing Director of the Nigerian National Petroleum Company Limited, Mele Kyari, stated that the landing cost of PMS is about N270/litre, while the government is paying the difference for it to be sold at the current N162/litre since 2020.

The Buhari's administration had planned to remove subsidy of petrol by June 2022 but this was rejected by individuals and groups accusing the government of inflicting more suffering on Nigerians.

However, on Monday, the Minister of Finance, Budget, and National Planning, Mrs Zainab Ahmed, announced the suspension of the decision stating that the removal of fuel subsidy at this time would be problematic.

This had attracted criticisms from concerned citizens and groups particularly the Nigerian Bar Association, amongst others who attributed the suspension to the forthcoming elections. According to them, the government suspended removal of fuel subsidy as an election strategy.

 Adesina debunked claims saying the suspension had nothing to do with politics.

“It is a valid thing [to do],” Adesina said of the government’s suspension of the removal, adding, “but is this done because of elections next year? No. It is done because as the minister (of finance) stated, the timing is not auspicious, inflation is still high. In the past eight months, we saw inflation reducing but the last month, it went up again; further consultations need to happen with all the stakeholders.”

The State Minister for Petroleum, Timiprey Silver on Tuesday also said that President Buhari has never been in support of subsidy removal.

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