₦airaland Forum

CodeTemplarr:
Cost effect wont go away with interest rate hike.

It is better production inputs are subsidized as well as increase production to swell supply against demand. The last will likely lead to export.

That's a solution worthy of examination. Thanks for bringing it up. Such policy has been applied to inputs like ENERGY over the years.

Electricity is currently subsidized and has been subsidized for DECADES in Nigeria. It has led to a DECREASE AND SCARCITY of electricity.

Petrol and other refined fuels were subsidized. The result was chronic scarcity.

Cement is an important input to housing and other construction activity. It was subsidized for DECADES before President Obasanjo put an end to that in 2003 or so. Before 2003, cement was scarce in Nigeria.

The public university system can be classified as a subsidy for the production of skilled manpower, which is a necessary input for economic growth. There's no development in Nigeria that suggests the moneys spent on advanced training for the youth have yielded exceptional or even good returns.

So it's very clear that input subsidies don't work in Nigeria. Again, it's a worthy suggestion but EXPERIENCE shows it's counter-productive.

Thanks.

Good Luck to Nigeria.

IbeOkehie:
That's a solution worthy of examination. Thanks for bringing it up. Such policy has been applied to inputs like ENERGY over the years.

Electricity is currently subsidized and has been subsidized for DECADES in Nigeria. It has led to a DECREASE AND SCARCITY of electricity.

Petrol and other refined fuels were subsidized. The result was chronic scarcity.

Cement is an important input to housing and other construction activity. It was subsidized for DECADES before President Obasanjo put an end to that in 2003 or so. Before 2003, cement was scarce in Nigeria.

So it's very clear that input subsidies don't work in Nigeria. Again, it's a worthy suggestion but EXPERIENCE shows it's counter-productive.

Thanks.

Good Luck to Nigeria.

Energy subsidy is largely towards consumption and luxury. That makes all the difference here.
A good instance of input subsidy will be towards something like coffee and cocoa farming. Even benneseed and other cash crops too. We dont consume them much but they can be easily exported for forex once accumulated as a result of the effect of input subsidy. Imagine trippling cocoa or coffee or benneseed output. Imagjne subsidising power for production of service parts. Instead we use it to watch DSTV and overpump water at night. We leave our bulbs on during the day and dont prioritize use of energy effecient bulbs or appliances.

Talkkng about chronic scarcity of peteol after its subsidy,that had to happen because of corruption. If you import for west africa but budget for only Nigeria, it is bound to become scarce wherever it sell for the loweat price when the volume of import reduces.

CodeTemplarr:
Energy subsidy is largely towards consumption and luxury. That makes all the difference here.
A good instance of input subsidy will be towards something like coffee and cocoa farming. Even benneseed and other cash crops too. We dont consume them much but they can be easily exported for forex once accumulated as a result of the effect of input subsidy. Imagine trippling cocoa or coffee or benneseed output. Imagjne subsidising power for production of service parts. Instead we use it to watch DSTV and overpump water at night. We leave our bulbs on during the day and dont prioritize use of energy effecient bulbs or appliances.

EXPERIENCE...not speculation....experience shows that such a subsidy will be an incentive for corruption.

It's likely that subsidized electricity for industry will be CORRUPTLY diverted and sold to households for higher prices.

By the way, President Buhari gave highly subsidized loans to farmers under Anchor Borrowers Program. I don't see any good results.

Fertilizer was subsidized for a long time and likely still is. No good observed results have been experienced.

There's no subsidy that will work in Nigeria. Again not speculation, that's evident from DECADES of experience.

Good Luck to Nigeria.

nairalanda1:
All because I criticized you for being abusive .

🥱🥱🤫🤫

Funkyswagzz:
🥱🥱🤫🤫

Be less abusive, young man.

Calling people stupid is not the right way to convince people of your good pounts

IbeOkehie:
EXPERIENCE...not speculation....experience shows that such a subsidy will be an incentive for corruption.

It's likely that subsidized electricity for industry will be CORRUPTLY diverted and sold to households for higher prices.

There's no subsidy that will work in Nigeria. Again not speculation, that's evident from DECADES of experience.

Good Luck to Nigeria.

Corruption can affect any policy. It is up to the authorities to dothe right thing and stamp it out.

Now we have removed subsidies because of corruption,are the leaders not stealing from where the saved funds were redirected to?
Was Lagos-Calabar highway award a fair and open process to you? What about state governors who havent done any tangible thing even with more than doubling of FAAC?
Corruption abounds in every area and it is up to the leaders to take a stand against it.

Lastly, subsidy will work if done well. If corruption cannot be tamed, it is better the country disintegrates until the units can stamp out corruption individually.

CodeTemplarr:
Corruption can affect any policy. It is up to the authorities to dothe right thing and stamp it out.

Now we have removed subsidies because of corruption,are the leaders not stealing from where the saved funds were redirected to?
Was Lagos-Calabar highway award a fair and open process to you? What about state governors who havent done any tangible thing even with more than doubling of FAAC?
Corruption abounds in every area and it is up to the leaders to take a stand against it.

Lastly, subsidy will work if done well. If corruption cannot be tamed, it is better the country disintegrates until the units can stamp out corruption individually.

It's clear that subsidy CAUSES corruption. That is the case in Nigeria and EVERY OTHER country. So one actual step towards a solution is to ABOLISH all subsidies

Good Luck to Nigeria.

nairalanda1:
Be less abusive, young man.

Calling people stupid is not the right way to convince people of your good pounts

I don't care if you are convinced or not go to hell

Shadomaan7:
Good news ahead for Nigerians. The bad news peddlers have been rendered jobless

shameless. #1150/ 1 litre of fuel, instead of #200/1 litre of fuel, and you called that good news, what is good about the news ?
i remembered that your shameless APC party promised Nigerians that they can bring down the price of fuel at #40/ 1 litre.
Pls stop celebrating mediocrity, because all Nigerians are not yet suffering from chronic amnesia.

IbeOkehie:
It's clear that subsidy CAUSES corruption. That is the case in Nigeria and EVERY OTHER country. So one actual step towards a solution is to ABOLISH all subsidies

Good Luck to Nigeria.

but now that you have abolished fuel subsidy, have you abolished the main problem, which is corruption from the system ?
without abolishing corruption from the system, subsidy removal is just cosmetic , therefore Nigeria is still worst off now than during the period of subsidy .
Nigeria politicians playing you gullible citizens, game of words, while ignoring the real problems and the effective solutions .

smileyoo:
but now that you have abolished fuel subsidy, have you abolished the main problem, which is corruption from the system ?
without abolishing corruption from the system, subsidy removal is just cosmetic , therefore Nigeria is still worst off now than during the period of subsidy .
Nigeria politicians playing you gullible citizens, game of words, while ignoring the real problems and the effective solutions .

This is where the REAL discussion starts. I've REPEATEDLY put down on this site my prescriptions for growing the Nigerian economy. I even started a thread but no one cared to contribute or maybe it's been over discussed, we know Nigerians looooove talking about corruption.

The major problem with Nigeria is that the economy is based on SOCIALISM, which means that government is the DOMINANT actor in the marketplace. Until this situation is changed, THE NIGERIAN ECONOMY WILL NEVER PRODUCE PROSPERITY or DEVELOPMENT, and to understand this every discussant must look up the ECONOMIC definition of development.

Some past comments:
https://www.nairaland.com/8232460/why-floated-naira-cardoso/4#132332487
https://www.nairaland.com/8182619/cant-believe-got-whole-324k/4#131474779
A basic outline of the issue:

Yes, but it will still be a futile effort until there's COMPLETE AND UNFETTERED FREEDOM.

In economics there are four factors of production -

Land - in Nigeria all land is owned by government.

Labour - the price of labour is regulated by government and indeed government is a major employer.

Capital - Nigerian currency value is regulated by government.

Until these factors are COMPLETELY controlled by the private sector, Nigeria will not prosper and develop. I know it's very unlikely to happen, so there you are, Nigeria is condemned to perpetual poverty.

So yes I commend President Tinubu. I appreciate his efforts while always noting that the same Tinubu caused all the problems he's trying to fix. The problem though is that the policies reforms are superficial, they are not ALL ENCOMPASSING, they don't go to the BASICS of the political economy. Take LAND, why is it that an individual can't OWN land in Nigeria? This is a BASIC building block of economic prosperity!!! If indeed President Tinubu is serious, he MUST tackle that one issue.

Another thing is price regulation. There should be a Constitutional Amendment that prohibits government from setting or regulating ANY prices of anything or any service in Nigeria.

These are BASIC, BASIC things.

Other comments:

https://www.nairaland.com/8232460/why-floated-naira-cardoso/5#132363447

IbeOkehie:
No dodge.

1) Mains electricity supply is low and unstable because the entire sector is controlled, dominated and majorly owned by government. The Germans have been trying to help since around 2016, to no avail. Because the government doesn't want a free market system.

2) Roads - do you know its ILLEGAL to export granite from Nigeria since the 1970's? The reason given when the law was made is that Nigeria needs all its granite to build roads, which are badly needed for development. Roads are owned by government.

3) Railways - Where is Oga Gerrard? The Chinese have helped Nigeria to build a new rail network. ALL railways in Nigeria are owned by government and here's what's happening with it -

https://nairametrics.com/2024/09/29/fg-orders-probe-into-ticket-racketeering-allegations-on-abuja-kaduna-rail-route/
https://hallmarknews.com/massive-corruption-rocks-railways-ticketing-system/
https://businessday.ng/transport/article/nigeria-rail-stutters-on-passenger-decline-rising-dollar-debt/

Basically, the ONLY WAY to make Nigeria productive and developed is to adopt a classical neo-liberal, free market and capitalist political-economy. Note the POLITICAL. Because the ingredients of a highly developed nation are KNOWN, it's no longer a secret. They are ECONOMIC-POLITICAL factors as follows -

*demographic homogeneity,
*democracy,
*free markets and
*property rights.

The more of these FOUR factors are present in a country, the more LIKELY it is to be highly developed and prosperous.

For example, Nigeria could CREATE more homogeneity by creating TRIBAL BASED states and giving each a HIGH DEGREE OF AUTONOMY.

Nigeria could bestow PROPERTY RIGHTS by repealing the Land Use Act and give lands back to the people.

Nigeria could ABOLISH the Central Bank and adopt bitcoin as official currency, thus eliminating INFLATION.

Here's a convo between Oga Gerrard and myself that summarizes what I've outlined above.

https://www.nairaland.com/8182619/cant-believe-got-whole-324k/4#131474779

That's it. The problem of Nigeria is NOT corruption, poor infrastructure, low IQ, Western or White Imperialism or anything. People say Western Sanctions have hurt the Zimbabwean economy, true but...Nigeria is NOT under ANY sanctions and yet it's the Poverty Capital of the World.

Nor will Germany, China, Aliens from Pluto or Eskimoes or Singapore ever help Nigeria develop. The ONLY way for Nigeria to develop is to give its people FREEDOM, political & economic freedom. That's all. But we know Black Africans will NEVER allow their own people to be free. I mean these are the tribes that sold their own brethren into slavery. That about says it all.

Good Luck to Nigeria.

50 naira wouldn't cause any noticeable change in price but 50% would.

Funkyswagzz:
I don't care if you are convinced or not go to hell

Well, be less abusive, young man.

It makes you look beautiful

Be like most of the op's here actually get paid for their trolling. Abeg, make una fix me up somewhere too

Where is the reduction? Dey play

When economists says the economy is going right just know that it’s going left. They should just stay in classes, they only make sense on the black board.

Shadomaan7:
Good news ahead for Nigerians. The bad news peddlers have been rendered jobless

You guys don't read news before you rush to comment

nairalanda1:
Except that the government doesn't have dollars to give

Plus that's a recipie for more round tripping. Popular during buharis regime and one of the reasons why we even had to remove subsidy in the first place

So where are we now.. same subsidy money has been looted massively n inflation is in high numbers. This govt is so incompetent.

T-Pain didn't even enter office and sit down to enjoy the fact he is president.....he just remove fuel subsidy to bring hardship...