The federal government Thursday foreclosed reinstating the fuel subsidy regime as outrage grew over the hike in ex-depot price of petrol that jacked up the pump price from between N145 and N148 per litre to N158-N162 band.
The government said fuel subsidy constituted a drain on the country’s meager resources.
It noted that the pursuit of a policy of transparency and accountability was being entrenched in the Nigerian National Petroleum Corporation (NNPC), saying that in the next few months, aside from the recent published accounts of its subsidiaries, the corporation will release its group’s audited accounts to the public.
According to the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, who spoke from Abuja during a web seminar organised by the Extractive Industries Transparency Initiative (EITI), all the decisions were geared towards weathering the current headwinds posed by the COVID-19 pandemic.
She said the federal government was considering borrowing through the resource-backed plan, but added that it was taking into account all the risks associated with it.
“Our country Nigeria is going through a difficult economic period because of the crisis of the COVID-19 pandemic. This same crisis has also given us the opportunity to undertake some reforms that have been very difficult to carry out in the past.
“In general, we have developed a fiscal stimulus package of N2.3 trillion, about a $5.9bn multi- sectoral economic plan. The design is to be able to minimise the impact on the economy, to prevent contraction of the economy and prevent businesses from collapsing and also to protect the poor and vulnerable.
“Specifically, in relation to the extractive industry, we took the opportunity to remove fuel subsidies that have been a significant drain on our resources and on the economy.
“This we have been able to do by adopting a price modulation mechanism and the government has removed fuel subsidy provision from its revised 2020 budget and also from the Medium Term Economic Framework (MTEF) for 2021-2023. We don’t have plans to incur any expenditure on fuel subsidy.
“What that means is that the price of refined products PMS (petrol) will be determined by the global price of crude oil, so the price will keep changing according to how the global market operates,” the Minister stated.