It is no longer news that in the last three years a whooping N2.7tn had
been spent already on petroleum subsidy.The import of this discovery is
that about 22% of our national budget each year is spent on petroleum
subsidy. Unbelievably, there exists kerosene subsidy as thrown out by
NNPC probe this year.Education,Health Agriculture combined don't get
this percentage every year. The clandestine approval by the presidency
to continue to milk the nation via kerosene subsidy is height of
economic sabotage. Spending outside of Appropriation act is a criminal
offence on its own.NNPC has been deducting from oil proceeds close to N500m daily for
Kerosene that is sold at between N155 and N200 per Litre to consumers.
The burden of oil subsidy is a heavy given the fact that there are contending needs of Nigerians which government must urgently address.Top most among the problems that government must solve is mass unemployment.The major reason why there is geometric rise in legion of unemployed youth is inability of government to open up key sectors of the economy.Agriculture has the capacity employ as many people as we can imagine.Before discovery of oil, this sector was our mainstay.In the 50's through early 70's about 70% of our population were engaged in the sector and Naira was very strong.It is not too late to humbly tread this path now that we have a lot of money still coming from crude oil sales.
The burden of oil subsidy is a heavy given the fact that there are contending needs of Nigerians which government must urgently address.Top most among the problems that government must solve is mass unemployment.The major reason why there is geometric rise in legion of unemployed youth is inability of government to open up key sectors of the economy.Agriculture has the capacity employ as many people as we can imagine.Before discovery of oil, this sector was our mainstay.In the 50's through early 70's about 70% of our population were engaged in the sector and Naira was very strong.It is not too late to humbly tread this path now that we have a lot of money still coming from crude oil sales.
Nigeria needs to achieve urgently a level of industrialization
that a big portion of our GDP will be occupied by production
outputs.Government must make funds available with policy direction.Many
countries whose currencies are strong hav a very high industrialization
and consequently export more than they import.
Looking critically at the components of the subsidy, you will discover that the bulk of addictions to landing costs of finished petroleum products are inefficiency.There are so many charges included in the cost especially demurral for courtliness days the products remained uncleared at the ports.There are also arguments in some quarters that the products are smuggled to be sol at cheap prices across borders.Some have also argued that the products being subsidized could be afforded by the rich in the country who use luxury cars.Some rich individuals do have up to three cars.So, why do government need to subsidize the expensive lifestyle of Nigerians?
In all these, I think there is superior argument from a lot of Nigerians that they don't have much problem with petroleum subsidy removal if there is a clear use of the fund to provide infrastructure and urgent need of the people.Nigerians will not reject subsidy removal when electricity is stable and the use of generators is almost zero. It will be double punishment to pay for electric energy not consumed and pay exorbitant price for petrol to power your home every time.The state of electricity in Nigeria is terrible.There are artisans that need power for there business but have continued to buy petrol everyday.Those who cannot cover the cost of doing business have packed up and have since joined the ever growing army of unemployed youth.
Once thing is sure on this matter of oil subsidy and the economic pains, the dilemma of the nation continues.However this is no basis for continued retention of kerosene subsidy. It should go now!
Looking critically at the components of the subsidy, you will discover that the bulk of addictions to landing costs of finished petroleum products are inefficiency.There are so many charges included in the cost especially demurral for courtliness days the products remained uncleared at the ports.There are also arguments in some quarters that the products are smuggled to be sol at cheap prices across borders.Some have also argued that the products being subsidized could be afforded by the rich in the country who use luxury cars.Some rich individuals do have up to three cars.So, why do government need to subsidize the expensive lifestyle of Nigerians?
In all these, I think there is superior argument from a lot of Nigerians that they don't have much problem with petroleum subsidy removal if there is a clear use of the fund to provide infrastructure and urgent need of the people.Nigerians will not reject subsidy removal when electricity is stable and the use of generators is almost zero. It will be double punishment to pay for electric energy not consumed and pay exorbitant price for petrol to power your home every time.The state of electricity in Nigeria is terrible.There are artisans that need power for there business but have continued to buy petrol everyday.Those who cannot cover the cost of doing business have packed up and have since joined the ever growing army of unemployed youth.
Once thing is sure on this matter of oil subsidy and the economic pains, the dilemma of the nation continues.However this is no basis for continued retention of kerosene subsidy. It should go now!
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