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Nigerian leader defends end to fuel subsidy as hardship bites harder

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Nigerian leader defends end to fuel subsidy as hardship bites harder

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Nigerian President Bola Tinubu is defending his government’s decision to stop subsidizing fuel in the West African nation even as more states seek ways to cushion the resulting hardship on millions

fuel subsidy

On Wednesday, Nigerian President Bola Tinubu defended the West African country’s decision to stop subsidizing fuel, a decision that has already exacerbated economic problems by raising the cost of transportation and basic goods.

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At a meeting with governors in the nation’s capital of Abuja, Tinubu said that the money saved by ending the decades-long subsidy last week will aid the government’s projects and efforts to combat poverty.

Despite the fact that suffering is biting millions of people more severely, he pleaded for forbearance.

“We can see how poverty has affected our people’s appearance. It is society that causes poverty; it is not inherited. According to a statement from the Nigerian presidency, Tinubu stated, “Our position is to eliminate poverty.

According to the statement from the presidency, the governors agreed to remove the subsidy and pledged to cooperate in putting it into effect.

The government has been subsidizing the price of imported refined petroleum products for decades, despite the fact that Nigeria is an oil-producing country.

However, the government said that the fuel subsidies are no longer financially viable due to declining oil earnings, widespread theft, and a decline in foreign investment. It set aside more money for the subsidies in 2022—4.4 trillion naira ($9.5 billion)—than it did for infrastructure, infrastructure improvements, and health care put together.

However, analysts criticized the government’s choice to end the subsidy without providing incentives, particularly at a time when many Nigerians are already struggling to deal with record-high unemployment and poverty. Currently, inflation is at an 18-year high. Strikes have been threatened by unions in response to the subsidy decision.

Nigeria’s states have begun to adopt various measures seeking to assist citizens, especially workers commuting to work daily. Edo and Kwara states this week cut the work week from five days to three. Other states said Wednesday they are considering such measures as increasing the minimum wage of 30,000 naira ($65).

In Abuja and other parts of Nigeria, The Associated Press found businesses struggling after the subsidy end as they are forced to spend more money on fuel for generators. As many as 46% of Nigeria’s people do not have access to electricity, the World Bank says.

In Kano state, the economic hub of northern Nigeria, Mahmud Mudi, a taxi driver, said he had to halt his transport business because he was losing money with higher expenditure on gasoline.

“The situation is unbearable,” Mudi said. “As a family man, the already unfriendly economy has been worsened by this removal of fuel subsidy. I have had to suspend my taxi operations and rely on divine intervention.”

Rafi’atu Audi, a government employee in the state, said it is difficult to commute to work daily because of the sharp increase in transportation costs.

“Transport fares have shot up, but our salaries remain the same,” said Audi. “It’s painful (and) I cannot bear the costs anymore.”

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