News

Fuel subsidy would have cost Nigeria N5.4t by end of 2024 – Gov. Abiodun

Published

2 years ago

September 30, 2024

Fuel subsidy would have cost Nigeria N5.4t by end of 2024 - Gov. Abiodun

Ogun State Governor, Dapo Abiodun, says that fuel subsidy would’ve cost Nigeria N5.4trillion by the end of this year if not removed by President Tinubu.

Speaking at an event in Abeokuta on September 29, Abiodun highlighted that paying such a massive amount for fuel subsidies would have been catastrophic for Nigeria, especially given the FG’s N6.7 trillion budget for the fiscal year.

The governor said the amount saved from the subsidy removal will be invested in improving infrastructure and other social services.

“The Federal Government, under the visionary and dynamic leadership of our President, Bola Ahmed Tinubu, wasted no time in initiating a series of bold, courageous, and transformative policies aimed at revitalizing our economy and steering the nation away from the brink of bankruptcy. These decisive actions have been necessary steps in addressing the significant economic challenges that have plagued Nigeria for years, and as a nation, we must remain committed to persevering through this period of reform for the betterment of our future.

One of the most crucial and impactful decisions taken by Mr. President was the removal of the longstanding fuel subsidy. This subsidy, which was originally intended to provide relief to Nigerians, had unfortunately become unsustainable and was increasingly detrimental to the economy. Had the subsidy not been eliminated, it would have cost the nation a staggering N5.4 trillion by the end of 2024. This massive financial burden would have drained vital resources that could otherwise be allocated to pressing national needs.

ALSO READ: It’s time to end fuel subsidy payments – Dangote

For years, Nigeria has been effectively subsidizing not only its own fuel consumption but also that of its neighboring countries, through illegal cross-border smuggling and price disparities. This has resulted in significant revenue losses and a misallocation of government funds that could have been better utilized in areas such as infrastructural development, healthcare, education, and other essential social services. The removal of the fuel subsidy is, therefore, a necessary and strategic move aimed at redirecting these funds towards investments that will have a more meaningful and long-lasting impact on the lives of Nigerians.

By freeing up this N5.4 trillion, the Federal Government now has the opportunity to channel these resources into critical areas that will directly improve the welfare of citizens. Investments in infrastructure, such as roads, bridges, and power supply, will facilitate economic growth and development, creating jobs and improving the standard of living. Additionally, social services like healthcare and education will receive much-needed attention, ensuring that more Nigerians have access to quality services and opportunities for personal and professional advancement.

In the long run, these bold initiatives by President Tinubu are designed to place Nigeria on a sustainable path of growth, reduce the strain on public finances, and build a more resilient economy capable of withstanding external shocks. However, the road to these improvements requires collective endurance and understanding from all Nigerians, as the benefits of these reforms will not be immediate but will undoubtedly secure a more prosperous future for the nation.

The President’s commitment to restructuring the economy and addressing long-standing inefficiencies is a testament to his determination to leave a legacy of progress, stability, and economic independence for generations to come. We must all unite behind these efforts and recognize that, while the short-term sacrifices may be challenging, the long-term rewards will significantly outweigh the current hardships.”