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Private sector backs removal of fuel subsidy, wants government to resuscitate four refineries

By Benjamin Alade
15 December 2021   |   3:55 am
Members of the Organised Private Sector of Nigeria (OPSN) have said if fuel subsidy is removed, funds that would be saved could address wide infrastructural deficits and other gaps in the country.

Taiwo Adeniyi

Members of the Organised Private Sector of Nigeria (OPSN) have said if fuel subsidy is removed, funds that would be saved could address wide infrastructural deficits and other gaps in the country.

The current subsidy regime hovers around N150 billion monthly and around N2 trillion yearly. OPSN Chairman, Taiwo Adeniyi, said this in Lagos, yesterday, while speaking on the state of the Nigerian economy, even as he called for urgent action.

He said although there are proponents and opponents, it is undisputable that the fuel subsidy regime is fraught with corruption, benefitting few petroleum importers. He described the payment as huge leakage from the revenue portfolio of the nation.

According to him, there is need to address this urgently and free up funds for development. Nigerians should not suffer for a product their nation is endowed with and neither should they suffer for inefficiencies in government, he said.

Adeniyi noted further that while it is desirable to remove the subsidy, it is also important for government to address socio-economic issues that would arise.

He said: “While we support removal of the fuel subsidy, we urge that government should, first, as a matter of boosting Nigerians and other stakeholders’ confidence and demonstrating its goodwill, address the following as a prerequisite to total removal of the subsidy.”

He called for resuscitation of the nation’s four refineries, upon which millions of dollars have been spent in Turn Around Maintenance (TAM), or outright sale to private investors to enhance their sustainability.

Adeniyi also called for measures to address the anticipated drastic reduction in citizens’ disposable income and standards of living. He noted that an increase in fuel price would have a direct and immediate consequence on transportation and cost of foodstuff, among others.

According to him, the proposed N5,000 monthly stipend to be given to 40 million of the ‘poorest of the poor’ will most likely aggravate tempers. He, therefore, advocated a more sustainable and well-thought-out relief.

He called for specific relief to workers and organised businesses, not only to reduce the immediate effects of the increase but also ensure the capacity of businesses to remain sustainable and continue to provide jobs.

He added: “While we note the short-term hardship that the removal of subsidy will cause the generality of Nigerians, it is important to state that the long-term benefit far outweighs the short-term pains, as the current beneficiaries of the subsidy are not the Nigerian masses.

“We urge that government urgently initiates a deepened engagement with critical stakeholders, including employers and the organised labour, with a view to arriving at a more realistic strategy to cushion effects of the subsidy removal on workers, employers and the generality of Nigerians.”

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