Nigeria removes fuel subsidies amid concerns

Last Updated: Monday, January 2, 2012 - 11:54

Abuja: Nigeria has announced the removal of
fuel subsidies amid fears of labour unrest, a move that is bound to be unpopular among the citizens of the oil-rich
African nation as it may push the prices of petroleum products
upwards.

The government of President Goodluck Jonathan said it has
spent more than USD 8 billion on the subsidies which it can
save by phasing out subsidies, and planned to use that amount
to help the poor.

It promised to use the amount saved from subsidy removal
to improve infrastructure but critics fear highly corrupt
elements in government may embezzle the money.

Petroleum regulatory authorities in Nigeria announced the
removal of fuel subsidies which would push petroleum price
upwards amid fears of labour unrest.

Long queues were seen at petrol stations as soon as the
Petroleum Products Pricing Regulatory Agency (PPPRA) announced
the removal while some refused to sell.

"Consumers are assured of adequate supply of quality
products at prices that are competitive and non-exploitative
and so there is no need for anyone to engage in panic buying
or product hoarding" PPPRA said amid increased apprehension
among citizens who see the fuel subsidy as the only benefit
they enjoy for being an oil producing country.

The country`s Senate also said the removal was premature
as consultations were still on-going.

The Senate spokesman, Enyinnaya Abaribe said such action
could only be carried out when a final decision has been taken
on the 2012 Appropriation Bill currently before the
parliament.

The labour union criticised the removal saying the
parliament has not given the process any legislative backing.

President of Trade Union Congress (TUC), Peter Esele said the government entered into a dialogue with its members last week only to turn behind and remove the subsidy.

"It is a total declaration of war on the poor masses who
are being punished by an inefficient system that is anchored
on few corrupt oil thieves who are major sponsors and backers
of government", he said hinting that the National Executive
Council of TUC would meet in the next few days to take a firm
decision on the issue.

"The Trade union Congress of Nigeria (TUC) rejects without
reservation the reported removal of petroleum subsidy by the
federal government as announced by the Petroleum Products
Pricing Regulatory Agency (PPPRA)," he added.

Nigeria is Africa`s top oil producer with an average
production of 2.4 million barrels per day.

Over 70 per cent of refined products are imported due to
lack of refineries but major marketers have indicated their
intention to build refineries after deregulation.

PTI




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