President Bola Ahmed Tinubu of Nigeria has stated his reason to eliminate the subsidy on petrol, stating it as a necessity for fostering a transparent and accountable energy sector.
Speaking at the inauguration of the 2024 Nigeria International Energy Summit (NIES) in Abuja, President Tinubu acknowledged the hardships faced by citizens, particularly those with lower incomes, but assured that the economy would ultimately benefit from the decision.
Represented by the Minister of Information and National Orientation, Mohammed Idris, President Tinubu stressed that energy security remains a top priority for his administration. He highlighted the strain that petroleum subsidies have placed on the country’s economic resources over the years, leading to inefficiencies and hindering investments in critical energy infrastructure.
He said: The petroleum subsidy has, over the years, strained our economic resources, leading to inefficiencies and, most importantly, hindering our ability to invest in critical areas of energy security.
“By removing the subsidy, we are creating a more transparent and accountable energy sector. The funds that were previously allocated to subsidising petroleum products are now redirected towards developing and upgrading our energy and other social infrastructure.
“Furthermore, the removal of the subsidy has encouraged further private sector participation in the energy industry, with the potential to attract more local and international investors and foster innovation and competition that will drive down costs and improve the overall efficiency of our energy sector.”
Acknowledging the hardship caused by the decision, the President said: “I am acutely aware of the immediate impact this decision may have had on our citizens, especially those with lower incomes.
Therefore, in parallel with the subsidy removal, my administration is committed to implementing social intervention programmes to mitigate the short-term effects on vulnerable populations. These programmes will ensure that the burden of subsidy removal is shared equitably and that the most vulnerable among us are protected.
“The decision to remove the petroleum subsidy is not an easy one, but it is a necessary one for the long-term energy security and economic prosperity of our beloved nation. I call upon all stakeholders, including industry experts, policymakers, and the general public, to engage in constructive dialogue and collaboration as we navigate these challenging but transformative times”, President Tinubu remarked.
