News / Africa

Nigeria Moving to Drop Fuel Subsidy, Trade Unions Object

People wait buy kerosene at a petrol station in Lagos, Nigeria, July 4, 2011.
People wait buy kerosene at a petrol station in Lagos, Nigeria, July 4, 2011.

Nigeria is moving to stop a $7.5 billion consumer-fuel subsidy because the government says it can better spend those funds improving public services. Trade unions oppose the move, saying it will force up the cost of living.  

Africa's largest oil producer refines little of its own petroleum. So Nigerian governments have traditionally subsidized the cost of imported fuel to keep consumer prices at about 40 cents per liter.

In its medium-term fiscal report to parliament, Nigeria's budget office says those subsidies will next year cost the government $7.5 billion at a time when rising demand for dollars to purchase refined fuel is making it harder to maintain the value of the Nigerian currency.

So President Goodluck Jonathan's government says it intends to do away with fuel subsidies and spend the money instead on social services and infrastructure.

Rivers State Governor Rotimi Amaechi is a member of Nigeria's National Economic Council which supports the move.

"We believe it is in the interest of this country," said Amaechi. "We will save money for the development of the economy. And at the end of the day we will provide opportunities for the greater percentage of Nigerians.”

Chief Solomon Osiobe says Nigerians should give up their dependency on subsidized fuel for the greater good.

"We Nigerians, we try to make sacrifices for the good of the nation," said Osiobe. "It is good that we make some sacrifice so that means we can move forward. So this removal of fuel subsidy I am in total support of it if it will bring progress to this country.”

Nigerian trade unions are threatening nationwide strikes if fuel subsidies are dropped. Local government worker Evelyn Akpoku says Nigerians can not afford the higher costs that would follow.

"Right now, the people are facing hardship," said Akpoku. "They are unable to even cook with this kerosene problem. Removing the subsidy will increase their problems. Transport will increase. Food will increase because the transporter will have to get his money from the populous who will be boarding their vehicles.”

University of Abuja economics and political science lecturer Abubakar Sadiq Abba says government must convince Nigerians that it will not misuse the money saved.

"Are we sure the leaders in Nigeria are going to utilize this particular amount that they are going to accrue from the removal of subsidy judiciously and prudently? These are questions that every Nigerian is asking,” said Abba.

Economists who favor eliminating the subsidy say it mostly benefits a cabal of a few hundred fuel traders who are getting rich off the price support. Abba says that is no excuse.

"If the government knows this cabal, if the government knows these people why can't they be arrested? Why can't they be prosecuted,” he said.

Local government worker Akpoku agrees.

“What does the federal government mean by the fuel subsidy money going to the wrong hands?  The federal government is in charge," said Apoku. "He should find out who the wrong hands are and then remove the money from the wrong hands and send it to the right hands.”

Rivers State Governor Amaechi says those few Nigerians who benefit disproportionately from the fuel subsidy will only grow richer if it is kept in place because of what he says are legitimate concerns over how that money will otherwise be spent.

"What will be the outcome? What are you going to do to improve on the lives of the people," said Amaechi. "If that is the conversation, they have the governors on their side. But if it is to say, 'No, leave the subsidy the way it is,” and a few Nigerians are benefiting from it to the detriment of over 140 million Nigerians, I won't agree to that.”

National Planning Minister Shamsudeen Usman says the government is working with trade unions to put in place economic safety nets to protect lower income Nigerians from higher fuel costs.

You May Like

India PM Modi's Party Distances Itself From Religious Conversions

BJP under fire for being slow to rein in hardline affiliate groups allegedly trying to promote Hindu-dominant agenda by luring Muslims and Christians to convert More

Anti-Whaling Group Found in Contempt of Court

Radical environmentalists who threw acid and smoke bombs at Japanese whalers in the waters off Antarctica continue their campaign to disrupt Japan's annual whale hunt More

UN's Ban Urges End to Discrimination Against Ebola Workers

Ban was speaking in Guinea on the second day of a whistle-stop tour aimed at thanking healthcare workers of the countries at the heart of the epidemic More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US Decision on Cuba Underscores Divisions Among Miami Cubansi
X
Sharon Behn
December 19, 2014 9:34 PM
For decades, older, more conservative Cubans have been gathering at Café Versailles on the corner of Calle Ocho to eat Cuban food and talk politics. After hearing of President Barack Obama’s decision, a number of them gathered in front of the café with posters to protest. VOA's Sharon Behn reports on the situation.
Video

Video US Decision on Cuba Underscores Divisions Among Miami Cubans

For decades, older, more conservative Cubans have been gathering at Café Versailles on the corner of Calle Ocho to eat Cuban food and talk politics. After hearing of President Barack Obama’s decision, a number of them gathered in front of the café with posters to protest. VOA's Sharon Behn reports on the situation.
Video

Video Three Cities Bid for Future Obama Presidential Library

President Barack Obama still has two years left in his term in office, but the effort to establish his post-presidential library is already underway. The bid for the Obama Presidential Library is down to four locations in three states -- New York, Hawaii, and Illinois. As VOA’s Kane Farabaugh reports, each of them played an important part in the president’s life before he reached the White House.
Video

Video Cuba Deal is Major Victory for Pope’s Diplomatic Initiatives

Pope Francis played a key role in brokering the US-Cuba deal that was made public earlier this week. It is the most stunning success so far in a series of peacemaking efforts by the pontiff. VOA religion reporter Jerome Socolovsky has more.
Video

Video Fears of More Political Gridlock in 2015

2014 proved to be a difficult year politically for President Barack Obama and a very good year for the U.S. Republican Party. Republican gains in the November midterm elections gave them control of the Senate and House of Representatives for the next two years -- setting the stage for more confrontation and gridlock in the final two years of the Obama presidency. VOA National Correspondent Jim Malone has a preview from Washington.
Video

Video Sudan School Becomes Target of Aerial Attacks

The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. VOA reporter Ayaz Gul visited the devastated school and attended the funeral of the principal who courageously tried to save her students from the deadly attack.
Video

Video Nigerians Fleeing Boko Haram Languish in Camp Near Capital

In its five-year effort to impose Islamic law in northeastern Nigeria, the Boko Haram extremist group has killed thousands of people and forced hundreds of thousands to flee. Some of those who ran for their lives now live in squalor on the edges of the capital, Abuja. Chris Stein reports for VOA.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.

All About America

AppleAndroid