Headlines: Fuel Subsidy Removal Has Put Nigeria on a New Economic Path - ONYEAMA

Headlines:
Fuel Subsidy Removal Has Put Nigeria on a New Economic Path - ONYEAMA

The Coordinator of the Aba South Club 17 Peace Initiative, Onyeama, has described the removal of petrol subsidy by President Bola Tinubu as one of the most significant economic decisions in Nigeria’s recent history. He commended the President for taking what he called a bold and necessary step, despite the immediate hardship and public criticism that followed the policy.

Onyeama maintained that several of the economic gains being recorded by the Federal Government can be linked to the subsidy removal. According to him, the previous subsidy arrangement had become financially unsustainable after remaining in place for decades, placing enormous pressure on the nation’s resources. He argued that ending the regime was therefore necessary to prevent an even more damaging strain on government finances.

“All the good results that I will reel out soon come as a result of that courageous decision. So, it is not a mistake; it is the best thing that has happened to this country. Subsidy was evil and had been with Nigeria for decades,” he stated. He further noted that President Tinubu inherited an economy facing several structural difficulties, including an unsustainable fuel subsidy system, challenges within the oil sector and a limited tax base.

The Aba South Club 17 Peace Initiative Coordinator also urged Nigerians to assess the administration’s economic reforms objectively rather than through emotions. He said the government had embarked on fundamental measures aimed at restructuring the economy and addressing problems that had accumulated over many years. Onyeama dismissed criticism of the reforms, insisting that their long-term implications may not yet be fully appreciated by some of the administration’s opponents.

He challenged politicians seeking to replace Tinubu in the 2027 presidential election to clearly explain what they would do differently. According to him, critics of the administration should be prepared to state whether they would reverse the removal of fuel subsidy or abandon the unification of exchange rates. He urged Nigerians to support and commend Tinubu for making what he described as statesmanlike decisions rather than politically convenient ones.

Onyeama further argued that maintaining the subsidy would have exposed Nigeria to an even heavier financial burden, particularly amid pressures in the global energy market and the Iran crisis. He claimed that the subsidy bill could have climbed to about ₦53 trillion, with the exchange rate potentially reaching ₦3,500 to the dollar. Although the May 29, 2023 subsidy removal initially triggered higher petrol prices, transportation, food and production costs, the policy has also increased government revenues and allocations to the three tiers of government through the Federation Account, even as concerns over its effect on the cost of living persist.