Remove Fuel Subsidy To Avert Imminent Financial Crisis, NESG Urges F.G

Except the Federal Government immediately removes subsidy on Premium Motor Spirit (PMS), Nigeria could be on the brink of another serious economic crisis.

This was disclosed by the Nigerian Economic Summit Group NESG In its report for September 2022, titled, “The State of Nigeria’s Economy,”.

In the report, the group lamented the huge revenue loss accrued from the payment of subsidy by the government, nothing that Nigeria was not generating revenue from oil in spite of the rise in crude oil prices in 2022.

“Despite an increase in global oil prices, the Federal Government’s actual revenue (N1.63tn for January – April 2022) is short of the pro-rated budget (N3.32tn), while government spending (N4.72tn for January – April 2022) was significantly closer to the budgeted levels (N5.77tn for January -April 2022),” the NESG said.

“Payment on petrol subsidy between January and July this year was N2.04 trillion, according to data from the Nigerian National Petroleum Company (NNPC) Limited”.

NESG urged the federal government to gradually phase out the fuel subsidy regime with a view to reducing spending as continuing the payment would be “disastrous.”

The group pointed out that even though citizens would feel the negative impacts of the withdrawal, it was in their best interest, adding that the effects would only be felt short term.