The Nigeria Employers’ Consultative Association (NECA) has urged the Federal Government to urgently fix the nation’s four refineries in the wake of the fuel subsidy removal which has triggered an unprecedented hike in prices of petrol and transportation fares.
As of Wednesday, petrol in different parts of the country sold for between N488 and N600 per litre, with Nigerians lamenting the immediate hardship this has unleashed on families.
President Bola Tinubu on Monday after being sworn in, Monday, in Abuja, said that the fuel subsidy regime was gone, as it was not provided for in the 2023 budget of the Federal Government, beyond May 2023.
Reacting to the development, Wale-Smatt Oyerinde, the director-general of NECA, in a statement, said with fuel queues returning to petrol stations and prices of goods and services rising astronomically, there was a need for the government to approach the situation with care.
“The hike, if not well managed could lead to an increase in the prices of goods and services with consequential effects on the purchasing power of the already impoverished Nigerian.
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Already, inflation rate in the country is high at 22.22 percent as recorded in April 2023 and as such, any increase in the pump price of fuel will further accelerate inflation, which will distort and destabilise economic activities, shrink private sector business capital and lower the real disposable income of the people.
No doubt, therefore, the economy would contract in terms of growth; business activities will face serious backlash; and aggregate consumption will fall due to inflationary pressure.”
NECA said while it was desirable to remove fuel subsidy which, in real terms, is subsidising inefficiency and corruption, it was alo important that the removal was systematically and strategically done in order not to further impoverish and worsen the already bad socio-economic indicators – employment, poverty per capita income and many more.
It said “It is worrisome to note that prices of other commodities have skyrocketed a few hours after the president’s pronouncement of subsidy removal. Consequently, it is critically important that the new government approach the removal of the subsidy with caution to circumvent further degeneration in the economy.
The employers’ body said it was expedient that in the spirit of frontally addressing corruption as stated President Bola Tinubu’s inaugural address on Monday, efforts be stepped up to complete the rehabilitation of Nigeria’s four refineries to complement the Dangote refinery that just came on board recently.
“With the measure, it will be possible to attain scale in petrol refining in the country so as to moderate domestic prices,” NECA added.
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