Fuel subsidy ’ll lead to economy collapse – Jonathan Featured
Written by  Olusola Fabiyi and Olalekan Adetayo

Fuel Subsidy ’ll Lead To Economy Collapse – Jonathan


A few hours to his departure for the Commonwealth Heads of Government Meeting in Perth, Australia, on Sunday, President Goodluck Jonathan met with the National Working Committee of the Peoples Democratic Party to sell,

his fuel subsidy removal plan.

Jonathan, according to a source at the meeting which held in the Presidential Villa on Friday, told the PDP chieftains that removing the fuel subsidy was inevitable as failure to do so could lead to the collapse of the economy.

“The President told us that there was the need to remove the subsidy and that though he appreciated the pains Nigerians would pass through after the removal, he said it was necessary if we did not want the economy to collapse,” the source confided in one of our correspondents at the weekend.

At the meeting were also zonal chairmen of the ruling party.

It was learnt that the meeting was the first forum at which the President intimated his party about the controversial proposal to remove fuel subsidy beginning from January next year.

Jonathan, had in his administration’s Medium Term Expenditure Framework, submitted to the Senate on October 4, said fuel subsidy removal would begin in January, 2012.

He had said that N1.2trn saved from the subsidy removal would be spent on providing social projects for the poor.

It was gathered that the Friday meeting, which started around 10pm, dragged on for a long time as party leaders were giving the opportunity of asking questions, to which the President reportedly provided answers.

The source said, “Apart from that, he also said the planned removal would be followed by a lot of palliatives, which he said were still being worked out.

“We asked him about the plan to review the refineries, he said plans were on and that the removal would also allow entrepreneurs to come into the industry, which he said would help in generating reemployment for the youths.”

The source said the President told the PDP leaders that he considered the meeting strategic in order for them to know the workings of government.

He also said this would enable them to be able to defend the policies since the party produced him.

The source added that the President said he would meet with the leadership of the opposition political parties when he returned from Australia.

Oil subsidy removal is part of the programme and policy thrust of the PDP.

Under its Policy Thrust on Petroleum Resources, the party manifesto says “A PDP-led government’s objective for the sector is to optimise upstream and downstream oil sector for a better role in the economy by increasing the level of oil reserves, expand exploration activities in onshore/offshore frontiers and liberalise and deregulate the industry with increased local content.”

Meanwhile, Governor Emmanuel Uduaghan of Delta State on Friday said fuel subsidy was not beneficial to Nigerians and that state governors were working together with the Federal Government for the proposed removal.

“A lot of discussions have gone into it. As at today, state governors are working with the Federal Government on this,” he told State House correspondents in Abuja.

He said the state governors decided to back the position of the Federal Government on the planned removal of fuel subsidy because the subsidy was not beneficial to the masses.

He said that another indication that the subsidy was not good for the nation was when it was revealed in the National Assembly last week that the Federal Government had already overspent the sum earmarked for fuel subsidy in the 2011 budget.  This, the governor, said was against the law.

He said rather than giving subsidy that would be beneficial to a clique, the money saved from the withdrawal could be used to develop infrastructure across the country.


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Watching and waiting

Lets tell it like it is.

The economy has been and will always be with the fuel subsidy, if any.

If anything will lead to the collapse of not just d economy but the entire nation, its the hardship, and the hue and cries from the removal of fuel subsidy.

What palliative measure will cushion the rise in house rent when govt provided no houses?
What palliative measures will cushion the crazy rise in cost of transport?
what palliative measure will cushion the effect of rise in food items?

(Fly wen nor dey hear word, )

Kx:

Lets tell it like it is.

The economy has been and will always be with the fuel subsidy, if any.

If anything will lead to the collapse of not just d economy but the entire nation, its the hardship, and the hue and cries from the implementation of subsidy.

(Fly wen nor dey hear word, )

Spot on !!! What of our ridiculously high recurrent expenditure and the cost of maintaining this worthless democracy? I.e 74% of annual budget? Will that not lead to "economy collapse" also? GEJ should just admit that he is weak and unable to bravely initiate cuts precisely where cuts are badly required. Rather, he will prefer to put the burden of "sacrifice" on long-suffering Nigerians instead of taking away from those who have far too much already i.e his hideously bloated AGIP buddies.

Here is what will happen. Let Oga Presido keep toying with the opportunity granted him.

Most poor nations although not ideal rely on subsides on food or petrol . Removing this without providing a soft landing is preparing for disaster. If a government is going to implement ideas, why not go all the way rather than engaging in half measures.

Gbawe:

Spot on !!! What of our ridiculously high recurrent expenditure and the cost of maintaining this worthless democracy? I.e 74% of annual budget? Will that not lead to "economy collapse" also? GEJ should just admit that he is weak and unable to bravely initiate cuts precisely where cuts are badly required. Rather, he will prefer to put the burden of "sacrifice" on long-suffering Nigerians instead of taking away from those who have far too much already i.e his hideously bloated AGIP buddies.

GEJ is not ready to reduce his salary and perks, yet he wants to remove the 'phantom subsidy' that they've been removing since 1986. Na wa o!

coward

he has no problem with inflicting hardship on the masses - much easier than inflicting hardship on his army of paid sycophants

i 'm totally disappointed in you mr president.

oKyrian:

i 'm totally disappointed in you mr president.

me too, Mr. President you are not making us proud of you at all, first single term now subsidy removal, you want to cause uprising in this Nation, God will not allow you, I know for sure in Jesus Name

As for me, the only condition that can make the removal of subsidy attractive is for us to be cocksure of how we would enjoy the benefits. When Gen. Sani Abacha increased fuel prices in 1994, he set up the Petroleum (Special) Trust Fund (PTF), under the leadership of Gen. Muhammadu Buhari, to spend the savings on infrastructural development. We all saw what PTF did. It remains the best public works programme the country has embarked upon in ages. Anything short of this landmark will be a massive failure.

Just too bad he isn't listening to wise counsel, same person who promised fighting for the masses is now against same. Let's just see if he,ll survive the backlash.

Mr Beaf, where r u?

Nigerians & GEJ fans wanted an educated puppet as a president. Now we reap the dividends.

He has still not explained how businesses or the masses will survive with the ripple effect.

This no be "Fresh Air". This na smell from overflowing septic tank.

Fresh Air 2011. PDP, Power to THE PEOPLE

Yes I Remember i once have no shoe.

Why did he failed to tell us this when he was campaining to become president?
Infact he deserve all the names they are calling him on this site  

Retardeen policies

What I think the plan is if he removes subsidy, increases licenses to import petrol, that will cause competition and that will automatically drive the cost down. If that is the plan, there he needs to execute it properly. Personally, I think the adverse effect won't be that worse like be thought it to be.

These prurient statements make me laugh.It is when you have an economy in the first place that you are afraid that it would collapse.the blatant fact is that Nigeria doesnt have anything called economy.When the whole world was shouting global recession,did we feel anything? Sadly, we are already on the ground,so there is no fear of falling.Dont be deceived by the government,they only want to save more money to be embezzled.

manny4life:

What I think the plan is if he removes subsidy, increases licenses to import petrol, that will cause competition and that will automatically drive the cost down. If that is the plan, there he needs to execute it properly. Personally, I think the adverse effect won't be that worse like be thought it to be.

LOL well sorry to break it down for you bros but that is NOT his plan

Him and Iweala's plans are as clear as day. Remove the subsidy so that the FG would spend less and the extra savings can he kept for themselves and friend . This I think is his plan.

alj_harem:


LOL well sorry to break it down for you bros but that is NOT his plan

Him and Iweala's plans are as clear as day. Remove the subsidy so that the FG would spend less and the extra savings can he kept for themselves and friend . This I think is his plan.

Well let's hope he has a backup source to this policies; me think he should seek wise counsel before delving into this. Unless he intends to create a "hot and fierce" competition, and we know competition drives price low, Nigerians are in for a hardship ride. I hope and pray he knows what he's doing.

Yes GEJ, failure to remove fuel subsidy will lead to economy collapse but corruption won't!
Mr. president should be talking about removing corruption subsidy from govt.

manny4life:


Well let's hope he has a backup source to this policies; me think he should seek wise counsel before delving into this. Unless he intends to create a "hot and fierce" competition, and we know competition drives price low, Nigerians are in for a hardship ride. I hope and pray he knows what he's doing.

Well I really hope he does know what he is doing as well. To me and I think to other millions of Nigerian, we just think he wants to make life harder for us while Iweala and him PLAY the western Plans for Nigeria. Moreover, I don't think there would be much competition as you suggested for the price to go down.

I remember when OBJ did this deregulation thing at 85 Naira, the prices fluctuated between 82 or so to 86 at different filling stations. Not much effect when compared to the inflation that followed.

This was the same way Babangida forced all his SAP conditionalities  on us, saying that we just have to have them or Nigeria collapse, we all know what happened to Naira and Nigeria since then.

Even America has subsidy in her economy, steel and cotton are highly subsidized in the US or else their industry would collapse.

manny4life:

What I think the plan is if he removes subsidy, increases licenses to import petrol, that will cause competition and that will automatically drive the cost down. If that is the plan, there he needs to execute it properly. Personally, I think the adverse effect won't be that worse like be thought it to be.

So sorry thats not the plan.


Now what will happen after the removal of fuel subsidy?
Currently demand is high which Nigeria is struggling to provide because of the same importation which is becos of our bad refineries.

Now removing subsidy will increase demand and supply will still be static which implies that demand will grow far far higher than supply and we all know what happens in this condition. The masses are going to suffer from this, the economic will collapse becos the citizens will collapse.

Event small N18k minimum wage na problem to implement, GOODLUCK EBELE JONATHAN how do you expect a man that earns less than 18k a month to live!!!

I think Mr Presido should be very careful in making and implementing decisions so that it doesn't result to a volcanic eruption.

I'm so so disappointed in him.  Mostimes "The devil u knw is better than the angle you dont know"

I sitdon dey look,

I'm actually in favour of removing the subsidy, I just don't want this government to do it. Over the last 2 years, GEJ has shown that he is completely incapable of controlling his spending and he cannot be trusted to manage our money responsibly.

I'm convinced that any money we save from removing subsidy will be wasted on some friviolous nonsense like expanding the government even more or bribing his way to victory in 2015. The money GEJ squandered in his first 8 months in office (with nothing to show) is far more than what he'll save by removing subsidy.

If GEJ needs money "for the poor" he should concentrate on cutting down his bloated government. Let a future president who knows what the hell he's doing remove the subsidy.

i had no sheos indeed

What do you expect from a dullard. I just pity the South South people because this clueless GEJ a.K.a shoeless dullard will just waste the slot for them.

Who is even advising this man? Obasanjo and Yar'adua with all their military and political backing didn't attempt to remove subsidy. Now, you without class, carriage, intellect and even support from the high and mighty to even think of removing subsidy is a slap on the collective psyche of Nigerians.
The last days of your government are here. remember, those whom the gods want to destroy . . .

I pity GEJ, Mr. Pressy, pls take a cue frm wot happened to Mr. Ghaddafi the stubborn man, His people loved him when he first came in, but rebelled later, Your own people will not only rebel, but your decision will cause great war in this country, Be careful of your decision on this matter Sir!

manny4life:

What I think the plan is if he removes subsidy, increases licenses to import petrol, [b]that will cause competition and that will automatically drive the cost down. [/b]If that is the plan, there he needs to execute it properly. Personally, I think the adverse effect won't be that worse like be thought it to be.

Wrong.

A monopoly will be created by the few who can control the market who will then dictate a uniform price range. Of course most politicians will go into this business.