Business
CIE Supports FG On Deregulation
Mr. Peter Ikpamejo, the registrar of the Chartered Institute of Economists has appealed to Nigerians to accept the Federal Government’s plan to deregulate the down stream oil sector.
He, however, advised Federal Government to exercise caution in the process, insisting that various agencies of government saddled with the responsibility of working out the modalities for the deregulation should carry the people along.
Government’s attempt to deregulate the down stream oil sector, has attracted strong condemnations from the public, most especially from the organised labour and the civil society.
While the Federal Government insists that it would deregulate the down stream oil sector in order to reduce the huge money being spent on petroleum subsidy, which it alleged was not affecting the common people, the organised labour expressed their opposition to it on the ground that doing so would further impoverish the people.
However, Ikpamejo who spoke with journalists in Abuja, said that the only way to make products available to the people was for government to remove all the bureaucracies in the sector with a view to eliciting private sector participation.
According to him, “To my mind, I feel deregulation is desirable for the country. Government must ensure that it removes all the administrative bottlenecks which inhibit private participation. Lime it happened in the communication sector, if private investors are allowed free entry into the downstream oil sector, it will not only engender efficiency, it will also make the product available to the people.
While debunking some insinuations making the round that deregulation will only bring pains to the people, Ikpamejo hinted that there are inherent benefits in it on the long-run.
He said that apart from the fact that the perennial queue often encountered by the people would disappear; if investors are encouraged to build refineries, a lot of employment would be created to the teeming Nigerians roaming the streets for lack of job.
Even though he agreed that the prices of petroleum products might be higher on a short-run if the sector is fully deregulated, he explained that Nigerins would reap the benefits on the long-run, because, according to him, competition among the players in the sector will force down the prices.
In order to cushion the effect of the increase in price on a short-run, the economist explained that government should be flexible in its charges and taxes to reduce landing cost.