Subsidy Removal Will Increase Investor Interest In Local Refineries, Says Barau Umar

A renowned businessman, Abdulhafiz Umar Barau, has said that fuel subsidy is like a cancer to the Nigerian economy.

Abdulhafiz Umar Barau, a Diaspora businessman, further says that removing the subsidy is the best option for Nigeria’s economy to survive a complete collapse.

In an interview with our reporters, Barau said, “Aside from the fact that the subsidy was not directly impactful on the poorest of the poor in the society, the rich people with fleets of V6 and V12 SUVs are the ones enjoying the subsidy most.

“Most of the neighbouring countries are also benefiting from the subsidized fuel from Nigeria because some marketers used to smuggle through the land borders.

“By removing the subsidies, investors are going to show more interest in investing in local refineries because it means the government is no longer controlling the prices of refined products. Moreso, the funds saved from fuel subsidy payments can be used to directly help the poor of the poorest in the country by providing good healthcare, better road infrastructure and supporting SMEs and MSMEs.

Recall that the Nigerian National Petroleum Company Limited (NNPCL) on Tuesday, further jerked up pump prices of Petrol, known as Premium Motor Spirit (PMS) from 537 to 617 naira Per Litre.

In May, a day after President Bola Tinubu was sworn into Power the Nation’s Apex Petrol station increased the fuel price from N195 per litre to 537 per litre.

The development was occasioned by Tinubu’s inaugural speech, where he said fuel subsidies would be removed.

In the first half of 2023, Nigeria spent N3.6 trillion on fuel subsidies alone. According to the Federal Government, the country will save close to N6.7 trillion if fuel subsidies payment is discontinued.

Nigeria has spent N13.7 trillion on fuel subsidies in the last 13 years, according to Nigeria Extractive Industries Transparency Initiative.