Now is the wrong time to remove Nigeria’s costly fuel subsidy, Information Minister, Lai Mohammed, said on Monday, noting many other nations were introducing measures to help citizens cope with high oil energy prices.
Africa’s largest oil exporter, which still has to import almost all its fuel needs due to lack of refining capacity, scrapped plans to abolish fuel subsidies earlier this year – a move that raised concerns with the International Monetary Fund.
“When you consider the chaos, the social disharmony and … instability such an action (of abolishing subsidies) would facilitate, is it worth it? I don’t think so,” Lai Mohammed said in a wide-ranging interview with Reuters.
Nigeria suffers intermittent fuel shortages. It has raised its deficit forecast twice this year and increased borrowing to cover the cost of the subsidy.
The country’s petroleum production has also fallen short of government targets, with $1 billion in revenue lost to crude oil theft in the first quarter of this year, according to the sector regulator.
Mohammed said a new industry law that allocates money to oil-producing communities would stop attacks and blamed the European Union’s climate change policies for stifling investment in the sector.
“We believe that climate change is real and important for emission control, but there is a bit of a double standard in the EU policy regarding climate change,” he said. (Reuters)
When you consider the chaos, the social disharmony and … instability such an action (of abolishing subsidies) would facilitate, is it worth it? I don’t think so.
