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Economy: Nigeria reaping positive results from ongoing reforms –Minister

Alhaji Mohammed Idris, Honourable Minister for Information and National Orientation (3rd from right), Alhaji Tunde Rahman, Presidential Media Aide; Malam Lanre Issa-Onilu, Director-General of NOA; Mr. Bayo Onanuga, Special Adviser to the President on Information and Strategy; and Other Top Government Officals, at a Media Engagement in Lagos

*Mohammed Idris, Minister for Information and National Orientation, affirms there are more success stories coming from President Bola Ahmed Tinubu administration’s reforms, urging the media as partners to support the government in projecting the positive outcomes for collective development and shared prosperity

Gbenga Kayode | ConsumerConnect

Following the termination  of the controversial petrol subsidy regime in the economy, the Federal Government has disclosed the importation of Premium Motor Spirit, otherwise known as petrol, into Nigeria has reduced by 50 percent.

ConsumerConnect reports  Alhaji Mohammed Idris, Honourable Minister for Information and National Orientation, restated this Wednesday, February 28, 2024, at the third edition of the Ministerial Press Briefing series, held in Abuja, FCT.

Prof. Ali Pate, Coordinating Minister for Health and Social Welfare, who featured on the programme, addressed reporters on activities of his Ministry.

Idris said that subsidy removal had led to the reduction of fuel imports by 50 percent.

He averred: “Petrol importation has been reduced by 50 per cent since the withdrawal of the fuel subsidy.”

It is recalled President Bola Ahmed Tinubu, GCFR, during his inaugural speech May 29, 2023, in Abuja, FCT, had declared that fuel subsidy “is gone!”

The Minister also noted that within 24 hours after that President Tinubu’s declaration of the fuel subsidy removal May last year, the Nigerian National Petroleum Company Limited (NNPCL), sole importer of PMS, subsequently withdrew subsidy on petrol.

The development later led to increased price of the commodity from about N198/litre to over N500/litre.

The cost of the consumer commodity later increased to about N600/litre.

Petrol per litre currently sells for between N620/litre and N700/litre, depending on the area of purchase, according to reports.

What’s volume of petrol Nigerians consume daily?

Malam Mele Kyari, Group Chief Executive Officer (GCEO) of NNPCL, February 18, 2023, about three months before PMS subsidy was stopped, had told Nigerians, was consuming about 66 million litres of PMS daily.

Kyari also said that over N400billion was spent monthly to subsidise PMS at the time.

He later told the Federal lawmakers in the National Assembly, that the subsidy was having adverse impacts on the cash flow of NNPCL as a state oil firm.

According to him, NNPCL is the sole importer of petrol into Nigeria, and has continued to play this role for several years running, bearing the huge cost of fuel subsidy.

Other private oil marketers stopped importing petrol into Nigeria due to the difficulty encountered in accessing the Dollars required for the imports of PMS at a time.

“By law and the provisions of the Appropriation Act, there is a subsidy on the supply of petroleum products, particularly PMS imports into our country. In current data terms, three days ago, the landing cost was around N315/litre.

“Our customers are here; we are transferring to each of them at N113/litre. That means there is a difference of close to N202 for every litre of PMS we import into this country.

“In computation, N202 multiplied by 66.5 million litres, multiplied by 30 will give you over N400bn of subsidy every month,” Malam Kyari explained.

Petrol importation into Nigeria crashes by 50 percent, says Idris

In line with Minister Idris’ revelation on Nigeria’s petrol importation that has dropped by 50 percent, by implication, the volume of imports into the country has reduced by about 33 million litres daily, based on NNPCL’s figures February 2024.

In essence, PMS importation has dropped by about 990 million litres in a month.

Meanwhile, oil marketers have reportedly said that the ex-depot price of petrol, that is the cost of the commodity from NNPCL, is about N585/litre.

Thus, a reduction of 33 million litres means the country is currently saving about N19.3bn daily and N579.1bn monthly, sequel to the President’s removal of subsidy on PMS.

Oil marketers also have stated several times that the purchase of petrol has reduced drastically.

Aligning with Minister’s position on the 50 percent reduction on fuel importation, Bennet Korie, National President, Natural Oil and Gas Suppliers Association of Nigeria, was quoted to have said: “The consumption of petrol has dropped to the lowest level ever.

“Filling stations are shutting down because there is no business anymore.

“The business is now very tough and marketers are struggling to survive. People don’t buy petrol again like before.

“So most filling stations are locking up because they cannot continue running at a loss.”

Korie also stated that the over 200 members of NOGASA could be forced to withdraw their services, because it was becoming increasingly difficult for oil marketers to fund their operations, a development that led to the shutdown of 70 percent downstream oil sector businesses.

The National President stated: “Another issue is that of high bank interest rates. Today if you want to buy one truck of PMS, you will spend N30million.

“And if you go to a bank to get N30million at over 30 per cent interest rate, you know how much you will pay to the bank, all in the name of inflation.

He added: “So, if care is not taken, we will also withdraw our service because there is no way out.

“70 percent of oil traders are out of business, so it is better that the government looks into this issue before it gets out of hand.

“Many of them (operators) cannot talk but they come to us to complain,” he stated.

Minister engages publishers, says Nigeria already reaping benefits of reforms

Minister Idris, at the briefing series in Abuja, affirmed that Nigeria had begun to reap the benefits of the reforms being introduced by President Tinubu.

Likewise, the Minister at a media engagement forum with Publishers Friday, March 1, in Lagos, that a lot of encouraging developments are happening in the country’s economy lately.

Idris noted that Nigeria’s Gross Domestic Product  (GDP) grew by 3.46 per cent in the Fourth Quarter (Q4) of 2023, as against 2.54 percent recorded in the Third Quarter (Q3) of 2023.

According to him, capital importation also increased to 66 percent Q4 2023, reversing a 36 percent decline in Q3.

“The Nigerian Stock Exchange All Share Index crossed the 100,000 mark – its highest ever, mainly due to the pragmatic reforms initiated by the President, which inspired investor confidence in the Nigerian economy.

“It is also encouraging to state that oil production has risen from 1.22 million barrels per day in the second quarter of 2023 to 1.55 million barrels per day in the fourth quarter of 2023,” he stated.

Among other positives being recorded in the country in recent times, Idris stressed President Tinubu has also given a directive for the design of a Social Security Unemployment Programme to cater for the unemployed graduates.

“This is in addition to setting up of a Social Consumer Credit Scheme to boost the purchasing power of Nigerians, as they make adjustments in view of the temporary economic hardship.”

In regard to the recent development in the Ministry, the Minister assured Nigerians that “as the government rejigs the National Social Investment Programme, the direct payments of N25,000 to 15 million households will resume immediately.

“The government is equally tackling insecurity headlong and more success stories are coming in on daily basis. Without any doubt, we are winning the war against insecurity.”

He, therefore, solicited the support of the media professionals as partners, in projecting the positive outcomes of the ongoing reforms to the publics for the overall advancement of Nigeria in the comity of nations.

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