Discovering the ‘vaccine’ to stop subsidy
Nigeria’s economy today owes its feeble strength and stability to the crude oil. The first oil well drill in 1956 at Oloibiri and the subsequent oil boom in the 1970s did not only change Nigeria’s destiny but set the ‘black gold’ on the path that led Nigeria to economic limelight and a flamboyant lifestyle. Oil wealth fuelled the nation’s political leaders negligence towards agriculture which was until then, the country’s economic power. Before the crude oil’s discovery, every region in the country saw itself in a swift competition to using agriculture as its means of sustenance and development. After the abrupt end of the first Republic, the nation’s successive governments at various stages saw the need to aggressively diversify the economy and made frantic efforts to actualise the dream.
Former President Olusegun Obasanjo’s tenure as Military Head of State, saw the country in pursuit of an economic diversification programme known as “Operation Feed the Nation”. The Late President Shehu Shagari administration’s concern was to diversify the economy and channel it towards achieving a “Green Revolution” programme for the nation. Of course, the Military President Ibrahim Babangida’s regime was quite magnanimous with bold and innovative diversification programmes not just to open up the rural areas and make rural dwellers feel important, but, to make Nigerians rediscover agriculture and bring it back to its pride of place. The Babangida administration had programmes like Directorate of Foods, Roads and Rural Infrastructures (DIFRRI), Mass Mobilisation for Self Reliance (MAMSER) and Better Life for Rural Women, a programme designed exclusively for the office of the First Lady, Mariam Babangida to showcase rural women development. However, it will surprise you to know that, the rhetoric and jamboree towards achieving these laudable programmes seem more successful than seeing the manifestation of the initiatives on the lives of the people or for the programmes to assist in shifting the nations economy from its mono-economic stance.
One major reason behind the failure of these laudable programmes is not far-fetched. The cheap and quick money from oil helped, still helping to determine what and how things should be done. Just as it encouraged reckless spending and jettison saving for the rainy day. Oil revenue also helped to relegate agriculture to a terrible background as it is hardly funded by government. At the moment, the new chapter in crude oil’s story is not palatable for an oil producing nation like Nigeria that has squandered every kobo from oil revenue. Just as the current stagnation in the international crude oil price and the fall in demand remains a turbulent nightmare for oil producing nations, especially as the world is shifting its attention to cleaner energy. No doubt, a cleaner planet is in everyone’s interest but a shrinking oil industry could mean, not less, turbulence as millions of people would be in the job market in oil producing countries.
In the face of all these challenges, the President Muhammadu Buhari administration recently came up with one of the most significant initiative of all times. It discovered a solution to end the nations’ age long lingering headache, over payments of subsidy for imported petroleum products. This initiative according to the minister of information and culture, Lai Mohammed, during the pre-inauguration inspection of the Waltersmith Modular refinery in Ibigwe, Imo State, the modular refineries would not only stop fuel importation and the humongous subsidy payments, but, by extension it would also reduce the pump price of fuel in the country.
The advocacy for the modular refineries in recent times is seen to be water tight, and is not expected to be moribund on arrival. The modular refineries according to government officials would help in increasing the country’s oil capacity and create jobs. The modular refineries, if allowed to operate independently, could rescue the nation from the lifeless but gluttonous refineries across the country that serve as finance engine for corrupt government officials who still conduct turn-around maintenance in the refineries for producing nothing. This brings to bear on Vice President Yemi Osinbajo’s argument that government has no business running the affairs of refineries in the country. Said he, “If the refinery is left in the hands of the government, it will continue to experience the same problem it is experiencing now. I do not think that it is the business of government to run the refinery. It should be the business of the private sector…”
Of course, it should be pointed out that, this humble idea of modular refineries has always been there all these while, but it was simply kept in the cooler for the appropriate time. No thanks to the coronavirus pandemic that quickened the release of the innovative idea from the laboratory’s incubator. It is no longer news that COVID-19 has humbled the entire world and made every government to look inward. Hardly in any platform that, President Buhari would not use the phrase: “…we must produce what we eat and consume what we produce…” just to make Nigerians look inward. Since the advent of COVID-19 this administration has not only been seen thinking outside the box, it has indeed taken the centre stage of national development through the local content drive.
However, many Nigerians feel the ruling government is putting the chart before the horse. Why increase the pump price of fuel before looking for the remedy to prevail by way of modular refineries? More so, lots of people fear that economic and political implications could just be big factors to consider for modular refineries success.