President Muhammadu Buhari has revealed the economic downturn that would bedevil Nigerians should the nation go back to subsidy era.
The President made this known during the First Year Ministerial Performance Review Retreat organized for Ministers, Permanent Secretaries and other Top Government Functionaries.
The Retreat took place at the State House Conference Centre in Abuja.
President Buhari who was represented by his Vice, Yemi Osinbajo disclosed the restoration of fuel subsidy comes at a very high economic risk which the present government cannot afford.
He said;
“The COVID-19 pandemic, which has affected economies globally, has compelled us to make some far-reaching adjustments that may cause some initial pain, but which is necessary for long-term gains.
“As you all know, when oil prices collapsed at the height of the global lockdown, we deregulated the price of premium motor spirit (PMS) such that the benefit of lower prices was passed to consumers.
“This was welcomed by all and sundry. The effect of regulation though is that PMS prices will change with changes in global oil prices. This means, quite regrettably, that as oil prices recover, we would see some increases in PMS prices.
“There are several negative consequences, if Government should resume the business of fixing or subsidizing PMS prices. First of all, it would mean a return to the costly subsidy regime.
“Today we have 60% less revenues; we just cannot afford the cost. The second danger is the potential return of fuel queues – which has, thankfully, become a thing of the past under this administration. Nigerians no longer have to endure long queues just to buy petrol, often at highly inflated prices.
“Also, as I hinted earlier, there is no provision for fuel subsidy in the revised 2020 budget, simply because we are not able to afford it, if reasonable provisions must be made for health, education and other social services. We now have no choice.
“Nevertheless, I want to assure our compatriots that Government will remain alert to its responsibilities. The role of government now is to prevent marketers from raising prices arbitrarily or exploiting citizens. This was why the PPRA made the announcement a few days ago setting the range of price that must not be exceeded by marketers. The advantage we now have is that anyone can bring in petroleum products and compete with marketers, that way the price of petrol will be keep coming down”, the President said.