Amid a global race to beat the COVID-19 pandemic, the Nigerian government is placing priority on funding a wasteful petrol subsidy scheme worth about $ 315 million monthly, an amount capable of vaccinating at least half of its adult population (53m people).
After a year of dilly-dallying on the removal of petrol subsidy, it is now official that the burden that has shortchanged Nigerians the most is real and active as the state oil firm has confirmed spending up to $315 million (N120bn/ exchange rate N380) a month on fuel subsidies.
This spendthrift is coming at a time when other countries are toiling night and day to provide funding for vaccination of as many of their citizens as possible. The message has yet to hit Africa’s biggest oil-producing country which relies on the goodwill of wealthier countries to pool donations of vaccines for its frontline workers.
Most Nigerians are bewildered that a government that couldn’t fund the purchase of roughly 289 million doses of vaccine required for herd immunity among its COVID19-threatened populace can somehow muster the strength to carry $ 315 million fuel subsidy expenditure monthly.
At the European cap price of $3 per dose of Astrazeneca vaccine, a rate used by Gavi, the Vaccine Alliance, Nigeria’s $315 million monthly spend on subsidy can fund a two-dose regimen for about 53 million people, half of Nigeria’s adult population.
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“For context, one month’s subsidy bill could purchase COVID vaccines for more than half of the entire adult population,” said a director at the Turgot Centre for Economics and Policy Research.
And even if the entire population were to be vaccinated, Businessday analysis shows it would only gulp $1.3 million, which is four times the amount Nigeria spends on petrol subsidy in one month.
“It’s a wrong application of whatever little money we have. The government should be bold enough to get out of this mess and allow deregulation take its course,” Joe Nwakwue, chairman, Society of Petroleum Engineers (SPE), told Businessday.
The expenditure on subsidy for PMS also dwarfs the government’s proposed 2021 spending of N45.19 billion allocated for immunisation against measles, whooping cough, and tetanus to the most vulnerable and disadvantaged children, despite a UNICEF report showing 4.3 million children in Nigeria still miss out on regular vaccinations every year.
“Petrol subsidy is a gorilla that has swallowed Nigeria’s economy and shortchanged unborn generation in terms of quality infrastructure,” said Wummi Iledare, a professor of economics and former president, Nigerian Association for Energy Economics (NAEE).
In a period Nigeria has one of the world’s highest numbers of out-of-school children, 13.2 million, according to the United Nations Children’s Fund (UNICEF), the amount spent on subsidy in one month is also larger than the entire 2021 budget of N94.4 billion meant for the provision of Universal Basic Education (UBEC).
