Economic Experts Raise Concerns Over N4trn Fuel Subsidy

Some economic experts have said that Nigeria’s economy cannot withstand the current adjustment of fuel subsidy to N4trillion by the Federal Government.

According to the experts, the N4trn approved by the National Assembly for fuel subsidy portends severe economic implications to the nation’s economy with attendant social upheaval.

In an interview with Daily Independent, Chief Executive Officer of Centre For Private Enterprises, Muda Yussuf, said that the adjustment of the fuel subsidy to N4trillion would unsettle the nation’s economy by widening the unemployment net in the country.

He said because the adjustment has upset the financial position of the public finance situation, an increased poverty level was inevitable and would bite harder.

According to him, the adjustment will also pose a burden to the country’s macro-economic situation, adding that the development would cause more borrowings which will go beyond what was presented to the National Assembly.

The upward adjustment of fuel subsidy, he said, will stiffen investment, create more pressures on inflation, and the exchange rate, as well a barrier to the ability of the Central Bank of Nigeria to finance the budget deficit.

He added that the government may intend to discontinue fuel subsidy but it would be difficult to do so on account of political needs.

Also speaking a former presidential aspirant, Chief Martin Onovo, said the adjustment of fuel subsidy to N4trillion by the Federal Government was needless and unnecessary.

According to him, the Russia and Ukraine war was not a sufficient ground to adjust fuel subsidy in the country.

He said the administration of President Muhammadu Buhari was clueless, and inept, noting that the development was responsible for the slow growth rate of the country.