@OLASODE2K:dats exactly wat am saying!! Germany is using money dat would hav gone into those free food to develope their country!, Because d military and former incompetent leaders didn't do that, Doesn't mean we should not try again With d vibrant opposition,press,youths,computer age even terrorist!we hav now, D present govt knows we can't be taken for granted again!!

@bossinie wat has age got to do with good reasoning Is mark zuckerberg not richer and made more sense than ur dad!!

Don't live the old pension life broda!!

@dayo kanu, pls kindly stop engaging an internet nigerian citizen like ekt bear in needless argument. Jensinmi' brillant post has answered all. Corruption is serious here, and moreso d purchasing power of an average nigerian cant compare to dat of a same citizen in u.k@u.s.

valacious:
@dayo kanu, pls kindly stop engaging an internet nigerian citizen like ekt bear in needless argument. Jensinmi' brillant post has answered all. Corruption is serious here, and moreso d purchasing power of an average nigerian cant compare to dat of a same citizen in u.k@u.s.


Here they go again!!

billante:

@bossinie wat has age got to do with good reasoning Is mark zuckerberg not richer and made more sense than your dad!!

Don't live the old pension life broda!!

Good point,but how many of Mark Z's do we have reasoning like him If Mark Z reasoned like your post i analyzed he would be somewhere in the labor market & you will not be on this thread telling us how rich or poor your dad is or was it my dad Good reasoning begets good product or outcome but poor reasoning(your guess is as good as mine).Please accept that your reasoning was far below expectation and SHARPEN-UP

@belante, wat makes u think this present govt would be any different from others? The truth is that close to 40% of our national wealth is been frittered away through leakages in the system u call corruption. Even if GEJ throws 200billions dollars to improve power supply, corrupt politicians would simply pocket it. U remember the case of 15billion dollars OBJ threw at power. Despite the stance he publicly took against corruption talkless of an autopilot by the name GEJ. If u want to develop nigeria EFCC must be strengthened and the sidelined so called anti corruption bills in both the senate and house of reps be redusted and passed. The day capital sentence goes with corruption, we would be the happier for it.

Usually when posters make simplistic comparisons as the one the OP has just made - they naively assume that other collateral factors are the same e.g population, GDP, Inflation, Trade etc. It is the same trend we see with our leaders these days, in order to push an agenda, they make pedestrian statements and go further to define their core agenda around these pedantic and utterly repugnant line of reasoning. It is the main reason why we are constantly bombarded with FG policies that seems to have arisen from a local community co-operative meeting 

OLASODE2K:

@belante, wat makes u think this present govt would be any different from others? The truth is that close to 40% of our national wealth is been frittered away through leakages in the system u call corruption. Even if GEJ throws 200billions dollars to improve power supply, corrupt politicians would simply pocket it. U remember the case of 15billion dollars OBJ threw at power. Despite the stance he publicly took against corruption talkless of an autopilot by the name GEJ. If u want to develop nigeria EFCC must be strengthened and the sidelined so called anti corruption bills in both the senate and house of reps be redusted and passed. The day capital sentence goes with corruption, we would be the happier for it.

Calculate that. it is well above half of our 2011 Budget wasted (stolen more like)

[size=15pt]Does UK/US import refined petroleum products[/size]

An escort in Manhattan would collect $500 in Thailand you can screw a whole village with that amount

haba @dayakonu, wia u wan get the mojo to do the job sef,

My issue with this subsidy is that the benefits have mainly gone to fuelling the already existing corruption in the oil sector. In fact, I strongly suspect that it is actually because, and not in spite of, the subsidy that our domestic refining capacity has not been enhanced since 1999. Some of the oil marketers are probably taking even the domestically refined oil to the ports and bringing them through these ports, thereby claiming subsidy on domestically refined petrol.

My submission therefore is that despite the likely short run impact on the common man, the subsidy should be removed as there is currently no incentive for the private sector to invest in construction of refineries. No one will want to build a refinery when it is simply cheaper to import petrol and claim a subsidy on such imports. The overall short run cost to the economy from removing the subsidy is, in my opinion, smaller than the long run benefits that will arise from better use of the petrol subsidy funds to finance, say, manufacturing, as well as the creation of an incentive to build refineries at home.

9ja must not fllw the western world trend. US earns far better than us so why must we increase our fuel price to above N100/L

There is no sane country in the world where government subsidizes imports. The original left-wing, Keynesian concept of a subsidy is that it is supposed to stimulate domestic production of commodities where such a country has comparative advantage in order to overcome the normal economic cycles of boom and bust, such that the economy can be kept at close to full employment even in the face of a recession. This is the only case where I have heard of a country subsidizing imports instead of seeking to produce at home. We need to create the necessary incentives for domestic refining by removing the petrol subsidy.

Kx:

[size=15pt]Does UK/US import refined petroleum products[/size]

@billante i think you should answer this poser

And what is the Minimum wage in US/Uk?
Comparing people collecting $7.5 per hour to Nigerians Collecting $4 per day does not make sense to me.

this billante leaves in a dream world? just making asinine statements right left and centre.

First of all in the US at least, pump price is by the gallon. So your listing is skewed to begin with.

Secondly and more importantly. Things in those countries work for the most part. Where's the welfare system in Nigeria? Even if they remove the subsidy and put it to 'better' use as they put it, will you not still be in your own words a beggar in the hands of your govt? Instead of the govt subsidising your fuel, they'll be giving you welfare handouts.

removing the subsidy is just the latest act of a govt that is worse than clueless, it actively hates us. this is basically our 'let them eat cake moment'

@Man_51ut didn't u read d attached article well Of course it s in gallons! $3.98 its about N600 divide it by 4 and u get per liter price!!

HNosegbe:

There is no sane country in the world where government subsidizes imports. The original left-wing, Keynesian concept of a subsidy is that it is supposed to stimulate domestic production of commodities where such a country has comparative advantage in order to overcome the normal economic cycles of boom and bust, such that the economy can be kept at close to full employment even in the face of a recession. This is the only case where I have heard of a country subsidizing imports instead of seeking to produce at home. We need to create the necessary incentives [/b]for domestic refining by removing the petrol subsidy.

You are talking a lot - but ain't saying nothing yet[b][b] @bolded[/b]. I hate that a lot of economic policies are explained to the public without an iota of evidence of how (technically) FG intends to achieve, sustain and extract the necessary benefits. As you, they will regurgitate working models but somehow choose not to measure the impact nor investigate the common factors that should make such policies work as it did in other economies. Our government is fond of slapping template economic policies and sticking their thumb in the air hoping to God it works. (It fails ultimately).

We should be asking questions -
1: Why will this work given our unique economic challenges.
2: How will it work given our socio-political deficiencies
3: When is the right time, NOW or in phases - are the right infrastructure in place to guarantee sustainability

lagerwhenindoubt:

You are talking a lot - but ain't saying nothing yet[b] @bolded[/b]. I hate that a lot of economic policies are explained to the public without an iota of evidence of how (technically) FG intends to achieve, sustain and extract the necessary benefits. As you, they will regurgitate working models but somehow choose not to measure the impact nor investigate the common factors that should make such policies work as it did in other economies. Our government is fond of slapping template economic policies and sticking their thumb in the air hoping to God it works. (It fails ultimately).

We should be asking questions -
1: Why will this work given our unique economic challenges.
2: How will it work given our socio-political deficiencies
3: When is the right time, NOW or in phases - are the right infrastructure in place to guarantee sustainability

Mr Lager you make it sound like every single government policy is doomed to failure simply because it has been obtained fom benchmarking global best practices. My point is, the incentive to build a refinery will never exist unless and until the subsidy is removed. It is even far better for government to subsidize refining in Nigeria to keep local refining (an the jobs that will be created with it) going than to continue with the current system of subsidizing imports. In short, government should shift the subsidy from importation to domestic refining. That way, you can support domestic refining until the local refiners can stand on their own. All that is required is commitment and political will to see this through.

@ekt_bear,am sorry to say this but you argue like a fool,I need answers to some of this questions(1)how does an average nigerian benefit from the government?(2)in terms of labor (income wise)can you compare nigeria to the US and UK?why do argue this way on reasons too obvious even for the blind to see?in nigeria,no health care,no good transportation,no good infrastructure,what are you even saying?that the lil subsidy they re benefiting from the gov should be taken away?SMH

steve_101:

@ekt_bear,am sorry to say this but you argue like a fool,I need answers to some of this questions(1)how does an average nigerian benefit from the government?(2)in terms of labor (income wise)can you compare nigeria to the US and UK?why do argue this way on reasons too obvious even for the blind to see?in nigeria,no health care,no good transportation,no good infrastructure,what are you even saying?that the lil subsidy they re benefiting from the gov should be taken away?SMH

you dey mind the Tinubu Economists?

I agree subsidies should be removed, provided the government can demonstrably show the subsidy funds are being used for developmental purposes and not just being stolen as usual.

For those arguing about the US not having subsidies, that isn't really the comparator we should be using - we should use 'developing' countries with significant oil resources like Nigeria to make comparisons.

Those countries have largely functioning refineries and distribution pipeline systems (not solely importation/ road tanker dependent like us) and continue to make products available as a matter of principle at low prices. Yes it causes some distortion, but this is a price that has to be paid in my view.

This 'subsidy' is the only form of benefit that majority of Nigerians receive from their government - almost everything else has to be paid for out of pocket at market prices.

Unless the govt can actually utilise the subsidy savings to materially improve other facets of life - improved healthcare, education, power supply, roads, etc, then there is no point removing it.

Get it into your heads - the likes of Shell, Exxon, ConocoPhillips and co are NOT interested in building refineries any more - ConocoPhillips is currently going to sell a 185,000 barrels per day refinery in the US, or CLOSE IT DOWN in 6 months if no buyers show up - that is in a country without 'subsidies'.

If the government doesn't get its act together and start running the refineries properly (or getting competent managers to do so) we'll wait forever for the likes of Shell and co to bring private investment.

@debosky: very good analysis!!

first we need to compare the per-capita incomes of these countries US $47,200 (2010 est.) UK $34,800 (2010 est.) NGR $2,500 (2010 est.)
Now we see that comparing us/uk in term of economic responsibilities is unfair.subsidy removal is feature of capitalism. US/UK can practise capitalism because they are wealthy and the govts are more responsible.the case is different in nigeria while many of her citizen live below the poverty line, the govt is irresponsible thereby making mixed type(mixture of welfarism and capitalism) of govt the only option. do you know to see a GP in US clinic if not insured costs abt $200 so shld we tell nigerians to pay 30k to see a doctor?
if govt wants to remove subsidy they must provide
good roads and good public transport
free health care
free and good public schools
electricity(so u wont buy generator)
etc

jarkbauer:

first we need to compare the per-capita incomes of these countries US $47,200 (2010 est.) UK $34,800 (2010 est.) NGR $2,500 (2010 est.)
Now we see that comparing us/uk in term of economic responsibilities is unfair.subsidy removal is feature of capitalism. US/UK can practise capitalism because they are wealthy and the govts are more responsible.the case is different in nigeria while many of her citizen live below the poverty line, the govt is irresponsible thereby making mixed type(mixture of welfarism and capitalism) of govt the only option. do you know to see a GP in US clinic if not insured costs abt $200 so shld we tell nigerians to pay 30k to see a doctor?
if govt wants to remove subsidy they must provide
good roads and good public transport
free health care
free and good public schools
electricity(so u wont buy generator)
etc

You got it. ours is an irresponsible government.