President Tinubu - Removing fuel subsidies is essential to preventing a financial meltdown

According to President Tinubu, it was important to keep Nigeria from going bankrupt by eliminating the fuel subsidy, since doing so was in the nation’s best interests.

In order to promote stability on the international scene, he emphasized the nation’s belief in economic collaboration and inclusivity with other countries.

Tinubu made these remarks on Sunday at a panel discussion focused on Global Collaboration, Growth, and Energy for Development at the World Economic Forum, which is now taking place in Riyadh, Saudi Arabia.

“For Nigeria, we are immensely consistent with belief that the economic collaboration and inclusiveness are necessary to engender stability in the rest of the world,” he stated.

“Concerning the question of the subsidy removal, there is no doubt that it was a necessary action for my country not to go bankrupt, to reset the economy and pathway to growth.”

During his inauguration on May 29, 2023, Tinubu told the populace that he was determined to cease gasoline subsidy payments, stating that the “subsidy is gone.”

The Federal Government used the subsidy to help citizens pay for fuel purchases at higher prices, but later on, it turned into a nightmare for the public because it was partially to blame for the skyrocketing prices of commodities in the market, particularly food and transportation expenses.

Nigerians and other concerned parties, such as the Organised Labour Union, as well as opposition leaders and the international community, expressed tension and made calls about the severe repercussions that had lowered the country’s citizens’ standard of living.

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Though declaring the gasoline subsidy to be eliminated was a difficult decision, the President acknowledged in his New Year’s speech on January 1, 2024, that the fuel subsidy payments made by the FG were an “unsustainable financial burden” on the nation.

“It is going to be difficult, but the hallmark of leadership is taking difficult decisions at the time it ought to be taken decisively. That was necessary for the country. Yes, there will be blowback, there is an expectation that the difficulty in it will be felt by a greater number of the people, but once I believe it is their interest that is the focus of the government, it is easier to manage and explain the difficulties.

“Along the line, there is a parallel arrangement to really cushion the effects of the subsidy removal on the vulnerable population of the country. We share the pain across the board, and we cannot but include those who are vulnerable.

“Luckily, we have a very vibrant youthful population interested in discoveries by themselves, and they are highly ready for technology, good education committed to growth. We are able to manage that and partition the economic drawback and the fallout of subsidy removal,” he stated.

Tinubu also mentioned that the elimination of fuel subsidies improved the nation’s accountability, transparency, and physical discipline.

Speaking on the unification of exchange rates and the volatility of the Naira relative to other international currencies such as the US dollar, Tinubu stated, “the currency management was necessary equally to remove the artificial elements of value in our currency. Let our local currency find its level and compete with the rest of the world currency and remove arbitrage, corruption, and opaqueness.

“That we did at the same time. That is a two-engine problem in a very template situation for the government, but we are able to manage that turbulence because we are prepared for inclusivity in governance and rapid communication with the public to really see what is necessary and what you must do.”