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

N. Korea Sentences American to 6 Years Hard Labor

Matthew Miller's brief trial Sunday comes two weeks after 24-year old Miller and two other American detainees appealed to the US government to help free them More

Pakistan Rejects Afghan Criticism of 480-kilometer Border Trench

Military spokesman tells VOA the project is part of administrative and security measures taken to secure the mountainous border with Afghanistan More

Photogallery Typhoon Kalmaegi Makes Landfall in Philippines

Storm makes landfall late Sunday, cutting power and communications lines and forcing people to flee to higher ground 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.
Scotland Independence Bid Stokes Global Interesti
X
Henry Ridgwell
September 12, 2014 8:35 PM
The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.
Video

Video Scotland Independence Bid Stokes Global Interest

The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.
Video

Video Washington DC Mural Artists Help Beautify City

Like many cities, Washington has a graffiti problem. Buildings and homes, especially in low-income neighborhoods, are often targets of illegal artwork. But as we hear from VOA’s Julie Taboh, officials in the nation's capital have come up with an innovative program that uses the talents of local artists to beautify the city.
Video

Video Palestinians Turn to Rebuilding Gaza

After almost two months of conflict in Gaza, Palestinians are preparing to rebuild the isolated Mediterranean enclave with assistance from abroad. Meanwhile, an international human rights group has found that Israel likely violated international laws of war during some of its attacks on Gaza. Zlatica Hoke has more.
Video

Video US Muslim Leaders Condemn Islamic State

Leaders of America's Muslim community are condemning the violent extremism of the Islamic State group in Iraq and Syria. The U.S. Muslim leaders say militants are exploiting their faith in a failed effort to justify violent extremism. VOA correspondent Meredith Buel reports.
Video

Video Middle Eastern Church Leaders Highlight Christians’ Plight

Patriarchs of Eastern Rite churches came to Washington this week to draw attention to the attacks against Christians in Syria, Iraq and elsewhere in the Middle East. VOA’s religion correspondent Jerome Socolovsky has more.
Video

Video Americans' Reaction Mixed on Obama Strategy for Islamic State Militants

President Barack Obama’s televised speech on how the United States plans to “degrade and destroy” the group known as the Islamic State reached a prime-time audience of millions. And it came as Americans appear more willing to embrace a bolder, tougher approach to foreign policy. VOA producer Katherine Gypson and reporter Jeff Seldin have this report from Washington.
Video

Video Authorities Allege LA Fashion Industry-Cartel Ties

U.S. officials say they have broken up crime rings that funneled tens of millions of dollars from Mexican drug cartels through fashion businesses in Los Angeles. Mike O'Sullivan reports that authorities announced nine arrests, as 1,000 law enforcement agents fanned out through the city on Wednesday.
Video

Video Bedouin Woman Runs Successful Business in Palestinian City

A Bedouin woman is breaking social taboos by running a successful vacation resort in the Palestinian town of Jericho. Bedouins are a sub-group of Arabs known for their semi-nomadic lifestyle. Zlatica Hoke says the resort in the West Bank's Jordan Valley is a model of success for women in the region.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid