₦airaland Forum

Toks2008:
lol...your abrevations no get mate o.

Isaacmacdon:
This is a löng nd uninspiring post! I can gladly say.. We've got stooges as "shakers".. Its ridiculous. U talk of tackling corruption in d downstream! Av u been sleeping or did u just steppd foot into planet earth 4 d first time? If d NLC turn a blind eye to dis situatn then it shows how ridiculous nd compromising humans can be! They shutdown nigeria for close to a week or more.. Truly ntin z hidden under d sun,all would be reviewed in no time! Corruption z a global thing! Can a man stop corruption? Vry much impossible! Well we shud jst look forward to a new world with a new government which would b ruled by the saviour n also the perfect being..

abbey621:
This is what I've been looking for, a complete analysis, BRAVO! The goats and yam stealers would not listen, they prefer to sell their present and mortgage their future....ANIMALS!

gwine0047:
should we then embrace corruption? I believe the mobilisation of Nigerians by top APC members during the previous subsidy removal era was a political game plan and a move to make sure all benefits from the blossoming global oil price. G.E.J. couldn't hold his ground
You would agree with me that the removal of subsidy is imperative at this moment. I say at this moment which means it could be later re-introduce . only a few people have been getting access to petrol at a good price. Removal brings equilibrium and eliminated scarcity. It also will aid businesses; limiting the upper hands private oil cabals use in dealing with the economy. It is a painful necessity.

Standing5:
Also it is time to ditch 100w bulb that can be replace by a 40w energy saving bulb.

Standing5:
Also it is time to ditch 100w bulb that can be replace by a 40w energy saving bulb.

Standing5:
Sweet thread but I don't entirely agree with OP (Toks2008) . . .
That part where u said it benefited the rich more isn't technical correct.
Subsidy was suppose to be 1 of the few things to help sooth the pains of corruption n help support productivity. It was meant to be a privilege that is proportional to consumption for all. The more you use the more you get.
Why subsidize usage?
It became important to subsidize fuel because it could help sooth the pain of power shortage and lack of good roads. The government couldn't deliver good roads and power to help drive industries and improve welfare so there was need to subsidize something that affects all Nigerians in a fair manner. Petrol was used by all either directly or indirectly and therefore it was subsidized.
Saying subsidy benefitted the rich more is like saying tax collection works against the rich more because the pay more.

kristisking:
Uses post. #plsbringbackourGEJ#

alwaysemmy:
QUESTION:

If PMS(FUEL) was then sold @ NGN22/litre as at 1999, and the Mininum wage was NGN18,000.00. Now in 2016, the PMS(FUEL) is being increased to NGN145/litre with the same NGN18,000.00 minimum wage. What will be the expected Minimum wage for the workers to balance their cost of spending?

Toks2008:
Over the years Nigerians have been faced with series controversies surrounding subsidy removal and many Nigerians have frowned against this with great ferocity each time the government of the day makes any move to remove it either totally or partially.

Many opposition bodies have used this to campaign against the government of the day and that was the case during the period of President Goodluck Jonathan and many Nigerians were also made to believe that it was indeed a callous move by previous governments to inflict hardship on Nigerians but just yesterday,we got a very surprising news that the APC led government have decided to finally remove subsidy as Petrol will now sell for a maximum of N145 per liter..

The question on the minds of many is why was there a strong move against this in the past? could it be to lack of proper sensitization of the populace by the previous governments?or was it because the lack of trust in the previous administrations or shall we say we have suddenly realized the true picture of the situation on ground? I guess these are questions we will continue to ask ourselves but this write up will address the reality and advantages of subsidy removal from a very layman's perspective and professionals are welcomed to shed more like and correct any form of misinformation.
[size=13pt]
THE REALITY[/size]

FUEL SUBSIDY:
Understanding the madness called “fuel subsidy” requires a walk down memory lane. However, let me start by saying a country like Nigeria, which is also the largest crude oil exporter in the African continent, imports fuel into the country.YES we know this makes no sense. Unfortunately, it does. Nigeria has four national refineries that are barely functional because of the country’s poor planning and maintenance culture, and even more, our refining plants are aging while the pipelines linking these plants have lacked adequate investments and they are terribly unreliable to support uninterrupted domestic production and sadly enough as determined as the government are in ensuring that these refineries are repaired,some interest groups have taken up the habit of destroying these facilities thus Nigeria is forced to refine its crude oil resources outside its borders and then it imports the refined products, mostly from European suppliers, to satisfy the energy needs of its large population.

WHO BENEFITS MORE FROM FUEL SUBSIDY?
Now lets assume the governments spends an average of N40 to subsidize a litre of petrol that is bought by each Nigerian,it means for every 20 liters you buy, the government helps you to pay N800. But the truth is that the rich benefits more because in a month they buy thousands of liters to power their office,homes,cars and so on while an average citizen with a tight budget might just manage to buy 50litres in one month.
[size=13pt]

Lets ask each other this question;Does it make sense for a government to spend over 1 trillion naira on fuel subsidy yearly to help the rich while lesser amount is marked for other infrastructures that would impact more positively on the average man?

Now lets take a quick look at 7 advantages of subsidy removal:[/size]

1. IT REDUCES CORRUPTION IN THE DOWN STREAM SECTOR:

According to the statement made by the former finance minister and coordinator of subsidy removal, Dr. Ngozi Okonjo Iweala. “ The removal of oil subsidy will drastically reduce corruption in the down stream sector.” Moreso, deregulation will also help to end the waivers enjoyed by powerful “cabals” at the expense of the Nigerian people...this needs no explanation.

2.PROVISION OF BASIC AMENITIES

The Nigerian governments spends over 1 trillion naira on fuel subsidy each year and this has made it extremely difficult to provide other amenities that would impact more directly in the lives of the citizens. However, if half of the money spent oil subsidy is channeled to other sectors of the economy, Nigeria would have been better for it. Consequently, the money saved from subsidies will be used to improve infrastructure, building good roads and bridges, fund agriculture,pay higher salaries,improve education and health sectors.

3.REDUCTION OF GOVERNMENT DEBT

According to the words of the former Central Bank Governor, Malam Sanusi, one of the long term benefit of the withdrawal of the subsidy is the reduction of government debt and at least help direct that debt to the finance of infrastructure that should create jobs and more inclusive growth. However, it is important to note that Nigerian government often borrow to enable it finance this oil subsidy so as to make the petroleum pump price affordable to a few rich Nigerians who operate or control some of the devices which actually consume the petrol.

4. TRANSFORMATION OF THE PETROLEUM SECTOR

A lot has been said of corruption in this nation, and the time is now to effect the change we need. Reformation of the oil sector which is the life wire of the nation could take the lead.

5. INCREASE IN FOREIGN RESERVE AND SAVINGS

With subsidy removal, Nigerian, government will get to keep more of the money raised from sales of its petroleum product and savings made on its foreign earnings, this will uplift the countries foreign reserves and greatly improves our ratings by international agencies.

6. ESTABLISHMENT OF MORE REFINERIES

It is noted that since 2000, government of Nigeria had issued licenses for refineries, but none was been built for these reason. This is not unconnected to the financial and structure imbalance created in the huge sums, of money expended on petroleum subsidy. However, it is obvious that with subsidy removal, Nigerian government can now use the money saved from subsidy to build refineries which will inturn provide enormous opportunities for employments of our jobless youths.


7. MAKES WAY FOR TRANSPARENCY AND COMPETITION IN THE OIL INDUSTRY

When petroleum subsidy which is rife with corruption and unhealthy practices is no longer there, transparency and healthy competition will return to the petroleum industry.


Lets give the government a chance and make this sacrifice with hope that we will have a new story to tell.Yes we may see a sharp increase in the price of commodities and transportation but in a short while, we will see the positive outcome just as we now see in previously deregulated sectors.

Toks2008:
Over the years Nigerians have been faced with series controversies surrounding subsidy removal and many Nigerians have frowned against this with great ferocity each time the government of the day makes any move to remove it either totally or partially.

Many opposition bodies have used this to campaign against the government of the day and that was the case during the period of President Goodluck Jonathan and many Nigerians were also made to believe that it was indeed a callous move by previous governments to inflict hardship on Nigerians but just yesterday,we got a very surprising news that the APC led government have decided to finally remove subsidy as Petrol will now sell for a maximum of N145 per liter..

The question on the minds of many is why was there a strong move against this in the past? could it be to lack of proper sensitization of the populace by the previous governments?or was it because the lack of trust in the previous administrations or shall we say we have suddenly realized the true picture of the situation on ground? I guess these are questions we will continue to ask ourselves but this write up will address the reality and advantages of subsidy removal from a very layman's perspective and professionals are welcomed to shed more like and correct any form of misinformation.
[size=13pt]
THE REALITY[/size]

FUEL SUBSIDY:
Understanding the madness called “fuel subsidy” requires a walk down memory lane. However, let me start by saying a country like Nigeria, which is also the largest crude oil exporter in the African continent, imports fuel into the country.YES we know this makes no sense. Unfortunately, it does. Nigeria has four national refineries that are barely functional because of the country’s poor planning and maintenance culture, and even more, our refining plants are aging while the pipelines linking these plants have lacked adequate investments and they are terribly unreliable to support uninterrupted domestic production and sadly enough as determined as the government are in ensuring that these refineries are repaired,some interest groups have taken up the habit of destroying these facilities thus Nigeria is forced to refine its crude oil resources outside its borders and then it imports the refined products, mostly from European suppliers, to satisfy the energy needs of its large population.

WHO BENEFITS MORE FROM FUEL SUBSIDY?
Now lets assume the governments spends an average of N40 to subsidize a litre of petrol that is bought by each Nigerian,it means for every 20 liters you buy, the government helps you to pay N800. But the truth is that the rich benefits more because in a month they buy thousands of liters to power their office,homes,cars and so on while an average citizen with a tight budget might just manage to buy 50litres in one month.
[size=13pt]

Lets ask each other this question;Does it make sense for a government to spend over 1 trillion naira on fuel subsidy yearly to help the rich while lesser amount is marked for other infrastructures that would impact more positively on the average man?

Now lets take a quick look at 7 advantages of subsidy removal:[/size]

1. IT REDUCES CORRUPTION IN THE DOWN STREAM SECTOR:

According to the statement made by the former finance minister and coordinator of subsidy removal, Dr. Ngozi Okonjo Iweala. “ The removal of oil subsidy will drastically reduce corruption in the down stream sector.” Moreso, deregulation will also help to end the waivers enjoyed by powerful “cabals” at the expense of the Nigerian people...this needs no explanation.

2.PROVISION OF BASIC AMENITIES

The Nigerian governments spends over 1 trillion naira on fuel subsidy each year and this has made it extremely difficult to provide other amenities that would impact more directly in the lives of the citizens. However, if half of the money spent oil subsidy is channeled to other sectors of the economy, Nigeria would have been better for it. Consequently, the money saved from subsidies will be used to improve infrastructure, building good roads and bridges, fund agriculture,pay higher salaries,improve education and health sectors.

3.REDUCTION OF GOVERNMENT DEBT

According to the words of the former Central Bank Governor, Malam Sanusi, one of the long term benefit of the withdrawal of the subsidy is the reduction of government debt and at least help direct that debt to the finance of infrastructure that should create jobs and more inclusive growth. However, it is important to note that Nigerian government often borrow to enable it finance this oil subsidy so as to make the petroleum pump price affordable to a few rich Nigerians who operate or control some of the devices which actually consume the petrol.

4. TRANSFORMATION OF THE PETROLEUM SECTOR

A lot has been said of corruption in this nation, and the time is now to effect the change we need. Reformation of the oil sector which is the life wire of the nation could take the lead.

5. INCREASE IN FOREIGN RESERVE AND SAVINGS

With subsidy removal, Nigerian, government will get to keep more of the money raised from sales of its petroleum product and savings made on its foreign earnings, this will uplift the countries foreign reserves and greatly improves our ratings by international agencies.

6. ESTABLISHMENT OF MORE REFINERIES

It is noted that since 2000, government of Nigeria had issued licenses for refineries, but none was been built for these reason. This is not unconnected to the financial and structure imbalance created in the huge sums, of money expended on petroleum subsidy. However, it is obvious that with subsidy removal, Nigerian government can now use the money saved from subsidy to build refineries which will inturn provide enormous opportunities for employments of our jobless youths.


7. MAKES WAY FOR TRANSPARENCY AND COMPETITION IN THE OIL INDUSTRY

When petroleum subsidy which is rife with corruption and unhealthy practices is no longer there, transparency and healthy competition will return to the petroleum industry.


Lets give the government a chance and make this sacrifice with hope that we will have a new story to tell.Yes we may see a sharp increase in the price of commodities and transportation but in a short while, we will see the positive outcome just as we now see in previously deregulated sectors.

MrPresident1:
The only thing that can save the disparate people agglomerated into the mere geographical expression called Nigeria is a genuine and heartfelt repentance and return to God. God is the one punishing us and we have not put it to heart, when God wants to punish a people, one of the ways He does it is to give the people wicked rulers, stubborn and wicked rulers who rule absolutely without any form of compassion. Nigeria probably now has her own Ghengis Khan.

Proverbs 29:2
When the righteous are in authority, the people rejoice: but when the wicked beareth rule, the people mourn

It is becoming clearer that GEJ was a righteous ruler, as he continues to be vindicated by the passage of time.
Every work of God is good, He is the righteous and true God, the holy One of Israel (Negros are Judah), God is visiting Nigeria with judgment gradually.

Deuteronomy 32:4
He is the Rock, his work is perfect: for all his ways are judgment: a God of truth and without iniquity, just and right is he.

MrPresident1:
The only thing that can save the disparate people agglomerated into the mere geographical expression called Nigeria is a genuine and heartfelt repentance and return to God. God is the one punishing us and we have not put it to heart, when God wants to punish a people, one of the ways He does it is to give the people wicked rulers, stubborn and wicked rulers who rule absolutely without any form of compassion. Nigeria probably now has her own Ghengis Khan.

Proverbs 29:2
When the righteous are in authority, the people rejoice: but when the wicked beareth rule, the people mourn

It is becoming clearer that GEJ was a righteous ruler, as he continues to be vindicated by the passage of time.
Every work of God is good, He is the righteous and true God, the holy One of Israel (Negros are Judah), God is visiting Nigeria with judgment gradually.

Deuteronomy 32:4
He is the Rock, his work is perfect: for all his ways are judgment: a God of truth and without iniquity, just and right is he.

Standing5:
it is hard to get those reduction in real life. Lots of phony marketers out there . . .

joseph1832:
In the mean time, what will happen to that man who has to pay twice the amount he pays to work everyday?

rexzqcom:
GSM ushered in at the time naira exchange rates wasn't officially artificially fixed (pegged). But now nnpc will have competitive advantages by using official fixed rates to source exchange and sell for N97.00/liter. While others will source exchange from higher parallel market rates, and sell for up to N145.00/liter.
Eventually other importers will expliot the discrepancy loopholes. One such, is others buying from nnpc@N97 for resales @N145.00 or higher, rather than importing anything. Eventually leading to scarcity and higher prices. This same uneven playing field will discourage foreign direct investment.
Remedy is to unpeg naira for even playing field, as would have obtained in Jonathan's era subsidy removal of market determined naira exchange rates.

Built2last:
It's not as though Nigerians do not know that fuel subsidy is long over due for removal but certain things have to be in place to cushion the effect.

First the president has to come clean and lead by example.
He has to do the following

Get the 4 refineries optimally running

Sell off 8 of the 11 presidential jets hanging at Abuja airpot and tell us what the money will be used for.

Increase tax on the rich. Like property tax. Own more than one property and pay heavy tax on the rest.

Get our rail ways up and running to ease transportation

Deploys policies that will check inflation.

Increase the minimum wage to atleast 50k

Call labour for negotiation afterwards and make public every deliberation.

The masses will support you.

This English you typed here op will not make sense to Nigerians next week bearing in mind that commodity prices will skyrocket without a corresponding increase in income of the people.

Taxi from Garki to Wuse in abuja that used to be 400 naira is now 800 naira.

A bag of rice I was told went to 25k from 15k yesterday.

A basket of tomato is 27k in Kano state today. That's where it's produced.

For your information, what the government did was price modulation to knock off subsidy payment by government. They have simply told the masses to pay. The petroleum sector was not deregulated. If you deregulate, you don't determine prices and so the government can not fix 145 naira. When you deregulate, you leave pricing to market competitors. Shell, Texaco, Chevron, Asda in UK, many other giants will move in to compete. They fix their prices and the masses can choose what price is most suitable for them. A good example is the telcom sector that was fully deregulated. Did you ever here the government telling MTN, Econet or Gloss how much to fix sim cards or charges on call? Because in a deregulated sector every manufacturer charges
based on the factors and modes of production.

For every cause there is an effect.

Any leader who puts his people first thinks of the immediate impact of his policies on the people and commodity prices.

I am #Built2last and I just want to correct your paradigm @op