Happy New Year pals.
I read this somwwhere and thought to share.
NIGERIAN ECONOMY AND FUEL SUBSIDY CORRUPTION*Nigeria spent N7trillion on fuel subsidy between 2010 and 2014
*Cost of fuel subsidy higher than the benefits to Nigerians
*Wealthier Nigerians benefit more from fuel subsidy
*Nigeria not harnessing her gas sector potentials for revenue, wealth & employment generation
World Bank Report on Nigeria Economy, No 3 (2015)
Evidently, as Nigerians know, the fuel subsidy regime was characterized by a large scale of corruption by the ‘revolving’ ruling class. The people who were charged and arraigned in court on fuel subsidy corruption during former President’s regime might be free by now as there was no update on their prosecution. Fuel subsidy regime over the years compensated importers and traders of petrol and kerosene.
In recent years, numerous audits and reports have identified widespread corruption and fraud in the administration of the fuel subsidy, and official petrol imports have substantially exceeded actual consumption. Attempts by the government to crack down on fraud and delay payment of the subsidy have commonly met with severe fuel shortages in the country that also impose high economic and welfare costs on her citizens.
Unfortunately in Nigeria, the working class and the poor are paying for the corruption in country caused by the rich. How? Job cuts both in private & public sectors, government cash crunch, loss of man-hours on the queue for fuel at gas stations, high cost of doing business especially for the SMEs due to non-availability of energy, inflationary impact on disposable incomes and so on.
In late November 2015, the National Assembly approved N522.25billions as supplementary budget for fuel subsidy payment to oil marketers. However, the Federal Government on Wednesday 9
th December, 2015 finally approved the payment of N407billion as fuel subsidy to oil marketers. According to Government sources, the payments include arrears from the 2014 financial year as well as payments for the current year. We keep paying to the enrichment of wealthier Nigerians to the detriment of the common wealth. The more we pay for the products, the less we get value for the money. Fuel subsidy has incapacitated the country’s ability to save for the rainy day occasioned by falling crude oil prices in the international market. There is no solution in sight to ending the fuel subsidy corruption in Nigeria. Even the Law and the courts are not able to tame the
Lion of the Gulf. Annual spending on fuel subsidy accounts for roughly one-fourth of all federal budgetary spending, and the spending was significantly greater than the entire executed federal capital budget as well as the combined spending on education and health. Brazil is currently experiencing economic recession. No thanks to corruption. Economists have warned that Nigeria is potentially cruising on the path of recession. If we don’t take necessary precautionary measures, corruption will push the economy into the dungeon of recession. And the recession shall be great indeed!
I’m requesting concerned professionals on this forum to come up with saving recommendations for the Nigerian economy, lest the economy ‘
goes into voicemail’.
In addition, let’s come up with workable solutions in harnessing the gas sector potentials (9th largest gas deposit in the world) in generating wealth, revenue and employment opportunities for Nigerians especially for our Millennials and Generation Z.
