Opinion
Fuel Subsidy And The Ghost Of 2012
On January 1, 2012, in his New Year address, President Good luck Jonathan announced the removal of fuel subsidy. The move was intended to lift the burden from the shoulders of the Federal Government in order that the much-needed funds would be freed for infrastructure; and also to deregulate the downstream of the oil and gas industry, thereby stirring up interest from investors.
The policy raised the price of Premium Motor Spirit (PMS), from N65 per litre to N141 per litre overnight, and this did not go down well with Nigerians. On Channels television, the Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iwala, stated that if nothing was done to stop the subsidy regime, it would increase domestic debt drastically.
Also, in an interview with the BBC, then CBN Governor, Sanusi Lamido, told the world that Nigeria spent $8 billion on fuel subsidy in 2011. A political analyst, Garba Sani, also noted that between 2006 and 2011, the country had spent a whopping $23 billion on subsidy
Even though the economics of the policy was impeccable, on January 2, 2012, protests broke out in major cities, like Lagos, Abuja, and Kano; and later spread to other major cities. By January 5 the major unions, NLC and TUC threatened to begin on January 9 indefinite strike, warning to shut down every aspect of the economy, including the airports.
The protest eventually metamorphosed into what is now remembered as Occupy Nigeria that was supported by Nollywood stars and popular musicians.
By the second week, Nigerians in Diaspora were already protesting in South Africa, Belgium, and the IMF headquarters in Washington DC. The protest that eventually spread across the country and the Nigerian High Commission in London and South Africa was to compel the Federal Government to reinstate fuel subsidy.
One major argument at that time was that fuel subsidy was the only benefit accruable to the ordinary Nigerian from our collective oil wealth. Others argued that negotiations were still ongoing at the time President Jonathan made the announcement on New Year’s Day.
President Jonathan was called all manner of names. The Vice President of NLC, Issa Aremu, commented that the President had shown himself as someone who could not be trusted. The opposition speculated that people in government would fleece any Kobo saved from the subsidy removal. While protesters in Lokoja in Kogi State blocked the major link road between Southern and Northern Nigeria, ex-militants in the Niger Delta blocked the Port Harcourt – Warri Highway; and others called for revolution.
At the Gani Fawehimi Memorial Park in Ojota, Chairman of Joint Action, Dr. Dipo Fasina, stated that the struggle for the liberation of Nigerians from bad governance just started. He went further to call for a revolt to remove President Jonathan from office.
However, there were a few people, like Prof. Akin Iwayemi, who supported the policy, blaming the stunted growth of the downstream oil and gas sector on the overbearing influence of the government. Others who supported the policy asserted that the subsidy only benefitted the rich and the middle class. Yet, others claimed that subsidy was a ruse to empty our national treasury, an avenue for massive corruption and waste.
After many negotiations with the NLC and TUC, the price of PMC was brought down to N97. But President Buhari elevated the price to N165 per litre and everyone was happy, even though doomsday was not eliminated, but postponed, and the ghost of 2012 has remained with us; and in the light of current economic realities, it appears the proverbial chicken has come to roost.
In the past ten years, there have been several indications that the Occupy Nigeria protest against subsidy was only a political stunt by the opposition. Even Prof. Yemi Oke noted that the agitation at that time was a political arrangement and game that had backfired.
As adults, we know that every lie has a short lifespan, and in the case of the fuel subsidy, it was barely ten years before all the lies against President Jonathan began to show signs of cracks as the national budget became bloated due to the subsidy component.
Today, even the Minister for State for Petroleum, Chief Timipre Sylva, had confessed that there is a whole criminal enterprise within the subsidy regime, further claiming that he did not know the actual amount of fuel consumed in this country daily.
In the same vein, Clement Isong, Executive Secretary of Major Oil Marketers of Nigeria, is of the opinion that Nigeria is subsidizing the whole of Africa. According to him, all our neighbours in Africa are buying PMS at the international price while here in Nigeria the price is less than half. The result is a criminal enterprise where no one, even in NNPC knows the litres of PMS we consume in the country.
The NLC has recently faulted the figure bandied by NNPC, especially as it formed the base for its estimate of N3 trillion for subsidy in 2022. Even Governor Fayemi of Ekiti State has called NNPC’s consumption figures as criminal. But, the Speaker of the House of Representatives, Rt. Hon. Femi Gbajabiamila, has constituted an Ad Hoc Committee to investigate the volume of fuel consumed daily in the country. .
Currently, the country is spending as much as N270 billion per month on subsidy; but unfortunately, only N443 billion was appropriated for fuel subsidy from January to June 2022, and if going by IMF’s estimate, we are yet to comprehend the full measure of the long term damage to our economy, especially if the current dollar exchange is thrown into the mix.
Now the whole nation is looking up to Dangote refinery, which we hope would come up before the end of this year. But I am hoping that going forward, no political party would play the kind of unpatriotic role the opposition played in 2012.
By: Raphael Pepple
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Empowering Youth Through Agriculture
Quote:”While job seeking youths should continuously acquire skills and explore opportunities within their immediate environment as well as in the global space through the use of digital platforms, government, corporate/ multinational organizations or the organised private sector should generate skills and provide the enabling environment for skills acquisition, through adequate funding and resettlement packages that will provide sustainable economic life for beneficiaries”.
The Governor of Rivers State, Sir Siminalayi Fubara, recently urged youths in the Rivers State to take advantage of the vast opportunities available to become employers of labour and contribute meaningfully to the growth and development of the State. Governor Fubara noted that global trends increasingly favour entrepreneurship and innovation, and said that youths in Rivers State must not be left behind in harnessing these opportunities. The Governor, represented by the Secretary to the State Government, Dr Benibo Anabraba, made this known while declaring open the 2026 Job Fair organised by the Rivers State Government in partnership with the Nigeria Employers’ Consultative Association (NECA) in Port Harcourt. The Governor acknowledged the responsibility of government to create jobs for its teeming youth population but noted that it is unrealistic to absorb all job seekers into the civil service.
“As a government, we recognise our duty to provide employment opportunities for our teeming youths. However, we also understand that not all youths can be accommodated within the civil service. This underscores the need to encourage entrepreneurship across diverse sectors and to partner with other stakeholders, including the youths themselves, so they can transition from being job seekers to employers of labour,” he said. It is necessary to State that Governor Fubara has not only stated the obvious but was committed to drive youth entrepreneurship towards their self-reliance and the economic development of the State It is not news that developed economies of the world are skilled driven economies. The private sector also remains the highest employer of labour in private sector driven or capitalist economy though it is also the responsibility of government to create job opportunities for the teeming unemployed youth population in Nigeria which has the highest youth unemployed population in the subSahara Africa.
The lack of job opportunities, caused partly by the Federal Government’s apathy to job creation, the lack of adequate supervision of job opportunities economic programmes, lack of employable skills by many youths in the country have conspired to heighten the attendant challenges of unemployment. The challenges which include, “Japa” syndrome (travelling abroad for greener pastures), that characterises the labour market and poses threat to the nation’s critical sector, especially the health and medical sector; astronomical increase in the crime rate and a loss of interest in education. While job seeking youths should continuously acquire skills and explore opportunities within their immediate environment as well as in the global space through the use of digital platforms, government, corporate/ multinational organizations or the organised private sector should generate skills and provide the enabling environment for skills acquisition, through adequate funding and resettlement packages that will provide sustainable economic life for beneficiaries.
While commending the Rivers State Government led by the People First Governor, Sir Siminilayi Fubara for initiating “various training and capacity-building programmes in areas such as ICT and artificial intelligence, oil and gas, maritime, and the blue economy, among others”, it is note-worthy that the labour market is dynamic and shaped by industry-specific demands, technological advancements, management practices and other emerging factors. So another sector the Federal, State and Local Governments should encourage youths to explore and harness the abounding potentials, in my considered view, is Agriculture. Agriculture remains a veritable solution to hunger, inflation, and food Insecurity that ravages the country. No doubt, the Nigeria’s arable landmass is grossly under-utilised and under-exploited.
In recent times, Nigerians have voiced their concerns about the persistent challenges of hunger, inflation, and the general increase in prices of goods and commodities. These issues not only affect the livelihoods of individuals and families but also pose significant threats to food security and economic stability in the country. The United Nations estimated that more than 25 million people in Nigeria could face food insecurity this year—a 47% increase from the 17 million people already at risk of going hungry, mainly due to ongoing insecurity, protracted conflicts, and rising food prices. An estimated two million children under five are likely to be pushed into acute malnutrition. (Reliefweb ,2023). In response, Nigeria declared a state of emergency on food insecurity, recognizing the urgent need to tackle food shortages, stabilize rising prices, and protect farmers facing violence from armed groups. However, without addressing the insecurity challenges, farmers will continue to struggle to feed their families and boost food production.
In addition, parts of northwest and northeast Nigeria have experienced changes in rainfall patterns making less water available for crop production. These climate change events have resulted in droughts and land degradations; presenting challenges for local communities and leading to significant impact on food security. In light of these daunting challenges, it is imperative to address the intricate interplay between insecurity and agricultural productivity. Nigeria can work toward ensuring food security, reducing poverty, and fostering sustainable economic growth in its vital agricultural sector. In this article, I suggest solutions that could enhance agricultural production and ensure that every state scales its agricultural production to a level where it can cater to 60% of the population.
This is feasible and achievable if government at all levels are intentional driving the development of the agricultural sector which was the major economic mainstay of the Country before the crude oil was struck in commercial quantity and consequently became the nation’s monolithic revenue source. Government should revive the moribund Graduate Farmers Scheme and the Rivers State School-to-Land agricultural programmes to operate concurrently with other skills acquisition and development programmes. There should be a consideration for investment in mechanized farming and arable land allocation. State and local governments should play a pivotal role in promoting mechanized farming and providing arable land for farming in communities. Additionally, allocating arable land enables small holder farmers to expand their operations and contribute to food security at the grassroots level.
Nigeria can unlock the potential of its agricultural sector to address the pressing needs of its population and achieve sustainable development. Policymakers and stakeholders must heed Akande’s recommendations and take decisive action to ensure a food-secure future for all Nigerians.
By: Igbiki Benibo
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