Tinubu’s subsidy removal and the albatross hunting Nigerians
By Rayyan Alhassan
Fuel subsidy removal by the present administration of President Bola Tinubu has come with a thunderous alarm. Although the intention may be good, pure and sincere, and in fact it is even noble but the reality now is that it is severely haunting everyone. Both the haves and haves-not are wailing. It is dealing a fatal knockout punch on teeming citizens, whose lives have since been made miserable and wretched. The Nigerian economy had almost strangulated them.
But it appears that the ‘ill-conceived’ idea to abruptly end the payment of subsidy by the Federal Government will finish the ‘job’. Less than two months after the ‘Petrol Subsidy is Gone’ proclamation by the President, on the occasion of his May 29 inauguration as Nigeria’s 16th leader, life has become unbearable and hopeless for many Nigerians.
Survival is now only for the fittest. The hope that their ugly fortunes will turn around under a Jagaban Presidency may just be fading away, or so it seems. The hue and cry over the subsidy removal may have since simmered. But the painful groaning by citizens will not just end. Nigerians are already battling to cope with the new normal of soaring transportation costs, and food prices’ inflation, among other negative impacts of the subsidy policy review.
With the harsh economic reality now starring everyone on the face – except the political class, possibly – the few men and women of good conscience left among us, who additionally have Tinubu’s ears must not remain docile. If it is possible, they should impress Mr. President to totally backtrack his decision on fuel subsidy. It will be patriotic, if not exemplary.
Tinubu has no choice but to wade in. He must arrest the socio-economic bedlam, triggered by not only the subsidy removal he singularly orchestrated. But the recent hike in the price of Premium Motor Spirit, PMS. On Tuesday, the Nigerian National Petroleum Company Limited, NNPCL, offered Nigerians a ‘sumptuous desserts’.
But the desserts were not the ones that will be nutritious to the body. That is just how we should describe the hike of fuel price to N617 from N537, by the NNPCL. The NNPCL and its apologists have attributed the latest increment to market forces at play.
But the organized Labour and other workers’ unions, together with some prominent Nigerians won’t stomach it. The Nigerian Labour Congress, NLC, described the recent increase in pump price as a threat to the socio-economic well-being of the citizens. It feared that the price of fuel would hit N1,000 per litre soon.
As for the Nigerian Union of Journalists, NUJ, the new price regime of PMS is an “over kill”. “We are saddened by the fact that today, most people can hardly commute to work or other places of business without too much stress, because the embarrassing sudden surge in petrol prices has made it so,” the NUJ said, in a statement issued by Shuaibu Usman Leman, its National Secretary.
The arbitrary hike of fuel cost to N617 will absolutely hurt Nigerians, and in many diverse ways too. For instance, it will make a large section of the country’s population fall deeper below the poverty net, while consumer spending’, and purchasing power will depreciate.
On one hand, the petrol hike has the potential to prevent manufacturers from producing below their targeted capacities, even as so many firms operating as private sector organisations will be forced to downsize their workforce. As things stand now, the cost of most goods and services have already hit the rooftop. And if care is not taken, Nigeria should be preparing to battle looming food insecurity, together with other life-tormenting emergencies.
With Boko Haram fighters, the Islamic State of West African Province (ISWAP) terrorists, armed bandits, oil thieves, kidnappers and a host of other criminals already holding the country to ransom, this hike will blow only an ill wind. It is verily going to escalate all sorts of criminalities in the land, as many youths and citizens get impoverished. This should not be what is heralding the Tinubu era, in Nigeria’s modern evolution.
Meanwhile, contrary to what many of us are forced to believe, Nigeria is not the only country in the world that subsidizes energy products like petrol or even some basic public services that its citizens enjoy. In fact, developed or advanced nations like the United States, France, Germany and the United Kingdom, UK, also do.
About $50 billion is what the United States is estimated to be spending annually to subsidize fossil fuel energy derivatives, including petrol and diesel for its citizens. Last year alone, two world superpowers – China and Russia – expended a mind-boggling $130 billion and $30 billion to subsidize energy, respectively for their citizens. And this is because they prioritize energy security as a matter of national security.
How about the UK? It has a $100 billion rolling subsidy scheme [energy price cap] for energy consumers in the country. Germany, on the other hand, is proposing to spend €5 billion this year alone, in subsidizing energy for manufacturers. Norway, another European nation, has already extended subsidy on electricity for its citizens into 2024.
It is ironic that Nigerian government officials, some ignorant citizens and arm-chair economists are hailing Tinubu for ending the subsidy regime. How they fail to realize that abrogating subsidy is the surest way of impoverishing teeming Nigerians. But they need to be enlightened.
Unlike Nigeria, oil-producing countries like Saudi Arabia, Kuwait, Angola, Venezuela and Iran are not contemplating doing away with it (subsidy), at least for now. On the contrary, they are providing generous subsidies for a range of fossil fuel energy derivatives like petrol, diesel and cooking gas for their citizens, as benefits of their natural endowments with hydrocarbons.
Let everyone who cares to listen, especially our leaders, know that corruption, low productivity, insecurity and mismanagement of Nigeria’s oil and gas assets and resources, are chief reasons the country is finding it difficult to meet its obligation of energy security to its citizens, unlike the aforementioned countries.
The idea of dishing out palliative items and provisions to distraught citizens will be welcomed, at any time. But only an insensitive government would have gone ahead with the disbursement of the proposed N8,000 handout as palliative to a phantom 12 million low-income Nigerians.
That President Tinubu eventually made a volte-face on the ‘sharing’ of the worthless N8,000 to some ‘poor citizens’ is one informed decision that has saved his government’s face. But it won’t be erasing the scar of bruises or heal the injury of the subsidy removal, many Nigerians suffered.
That is why Mr. President must think out-of-the-box in engineering a practical solution to the hardship citizens have been experiencing, since the Day One of his administration, following a pronouncement made without careful thought for the masses and their plights. To yearn for the days of the fuel subsidy will be wishing Nigeria doom.
But of what use is a policy directive that inflicts only pain, rather than ameliorate the collective hardship citizens are facing? I will leave that to you, the reader, and then of course, those who are presently saddled with the responsibility of sailing the Nigerian ship to the Promise Land, to ponder over.
As for our dear President Bola Ahmed Tinubu, an ample opportunity is still waiting for you to correct one perceived wrong against Nigerians. I am talking about ending fuel subsidy payments, without putting in place necessary measures to cushion the prevailing socio-economic turmoil in our polity.
Mr Alhassan, a social critic, writes from Abuja.