Why I Removed Petrol Subsidy — President Tinubu Reveals

On Tuesday, President Bola Tinubu stated that the decision to terminate long-practiced petrol subsidy payment in May 2023 was intended to allocate resources for essential infrastructure investments.

The Nigerian leader made this declaration on Tuesday during the opening of the 17th Annual Banking and Finance Conference organized by the Chartered Institute of Bankers of Nigeria (CIBN) in Abuja.

“Though painful in the short term, the removal of fuel subsidies is designed to free up budgetary resources for critical investments in infrastructure and social services, frequent adjustment of the monetary policy rate, a move aimed at curbing inflation and fostering a more market-oriented exchange rate system,” Tinubu said.

At the event, President Tinubu was represented by his deputy, Vice President Kashim Shettima, who characterized this year’s theme for the CIBN Conference, ‘Accelerating Economic Growth and Development: The State of Play and the Way Forward,’ as both timely and essential.

While enumerating the challenges such as high inflation, increasing living costs, unemployment, infrastructure deficits, and the impacts of global economic changes, the President noted that these challenges also offer avenues for growth and development.

“This theme will enable us to evaluate where we stand as a nation, understand the root causes of our economic challenges, and explore actionable strategies to accelerate growth and development sustainably and inclusively,” he noted, according to a statement by presidential spokesman Stanley Nkwocha.

“We have taken bold steps to reform the macroeconomic environment. Our focus is on restoring confidence in the Nigerian economy through measures aimed at reducing inflation, stabilising the foreign exchange market, and improving fiscal management.”

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Tinubu also noted that his administration is committed to strengthening infrastructure development in the ongoing bid to grow Nigeria’s economy.

“We are committed to upgrading Nigeria’s infrastructure to support economic growth. We are investing in roads, railways, and energy projects through public-private partnerships to reduce transportation costs and improve market access,” he said.

On May 29, 2023, upon taking office as Nigeria’s president, Tinubu, a former governor of Lagos, ended the era of petrol subsidy.

This sole action resulted in a significant increase in the pump price of petrol, soaring from approximately N200 per litre to more than N1,000 per litre.

The President’s unilateral decision has faced considerable criticism from numerous Nigerians, including labuor unions, as over 200 million citizens contend with an extraordinary rise in the cost of living and inflation.