President Bola Ahmed Tinubu has tasked Vice President Kashim Shettima led National Economic Council (NEC) to begin the process of providing interventions to ameliorate the impact of removal of subsidy on fuel on the people.
Governor Dapo Abiodun of Ogun State said this on Wednesday while briefing State House reporters after leading some major oil marketers on a courtesy call on the president at the Presidential Villa, Abuja.
The governor said the marketers were in the presidential villa to express solidarity with the president for his bold decision to end subsidy payment on Premium Motor Spirit (PMS) popularly known as petrol.
He said the president’s action showed his determination and courage to remove the hemorrhage that had bedevilled the country for decades.
He said the country was spending about N4 trillion annually on subsidy, which henceforth will be taken to the Federation Account Allocation Committee (FAAC) for sharing among three tiers of government.
The governor said while there would be some discomfort on the part of the people, the move would eventually pay off as there can be no gains without pains.
He said with the policy in place, the country would be saving over N6 trillion annually, noting that fuel prices have escalated in some neighbouring countries because of the increase in pump price in Nigeria.
The Chairman of Depot and Petroleum Marketers Association of Nigeria’s (DAPMAN),Winifred Akpani, led the group of major oil marketers that announced intention to donate 50 to 100 50-seater mass transit (at the cost of about N10 billion) CNG (Compressed Natural Gas) buses with the hope that others well meaning corporate bodies can do the same to cushion the effect of subsidy removal.
Akpani said the courtesy visit was to express the major oil marketers utmost support to the Federal Government’s decisions remove the fuel subsidy and maintain single exchange rate in the country.
She said that they were aware of the difficulties the subsidy removal had created in the country, expressing optimism that it was going to reposition the country.
The Managing Director of Northwest Petroleum & Gas Company Limited noted that Nigeria in the first three months of 2023 spent over N2 trillion, adding that if it continued with the payment, by the end of the year, it might spend about N7 trillion.
Mrs Akpani said through subsidy, Nigeria has been feeding her neighbouring countries, adding that it can no longer subsidize fuel for African countries while its economy continues to bleed.
Akpani said the association had been consistent in its clamour for a free market with subsidy removal which successive administration could not do because of lack of courage and political will.
She said they made some suggestions to the president, adding that the removal of fuel subsidy and government policy of conversion of vehicles to use Compressed Natural Gas (CNG) in place of petrol would attract more investments in the gas sector and create more jobs.
On support to government palliative plans, the DAPMAN boss said “we all collectively agreed that we’re going to work at providing real mass transit buses the ones that run on CNG, which is a compressed natural gas and diesel. Interchangeably, and hopefully we’re going to start with about 50 to 100. And that is in the very, short term. And these are locally produced. So, you see that we’re also providing jobs. A lot more jobs because we’re using local assembly plants, we are not importing these….That is less pressure on our foreign exchange, and that’s more jobs for Nigerians.”
She said the president was pleased to hear the association’s resolve to support the government in providing relief for the people, adding that Tinubu demonstrated knowledge of the oil market by asking intelligent questions.
Akpani said: “We have been feeding the whole West Africa sub Saharan Africa, with fuel. Since last week Monday and it’s difficult to believe that it’s only 10 days that this happened. If you check all those neighboring countries have all their prices shot up. Probably maybe Niger is the cheapest with about N580 per liter because they were all feeding on Nigeria’s fuel. But that’s not to say that because others are benefiting wrongly, Nigeria cannot be subsidizing the whole of Africa. When we have a lot of our own problems.
“Now suddenly, we now realize that we have gas in abundance. There was no fresh investment. Nobody’s going to invest in an economy that is not free.
“The President did listen to us very graciously. And it was interesting, because we all suddenly remember that he’s an accountant first and foremost.
“He asked and he interjected with very, very intelligent questions, and he understood what we meant by saying we want a complete free market. Free market to have one exchange rate so people can stop trading in dollars. With free exchange rate, then we have competition in importation, competitive licensing, and having refineries running.”