Former President Olusegun Obasanjo has revealed that the fuel subsidy, which was removed by the Federal Government in 2023, has been reintroduced due to rampant inflation. This announcement comes despite President Bola Tinubu’s firm declaration during his May 29, 2023, inaugural address that the subsidy had been abolished.
The removal of the subsidy had led to a steep increase in petrol prices, which skyrocketed from around ₦200 to over ₦600 per litre, causing significant economic strain on the populace.
In an interview with the Financial Times, Obasanjo criticized the government’s approach to the subsidy removal, suggesting that more preparatory measures should have been in place. He stated, “There’s a lot of work that needs to be done. Not just wake up one morning and say you removed the subsidy. Because of inflation, the subsidy that we have removed is not gone. It has come back.”
Obasanjo also emphasized the importance of building investor confidence in Nigeria, advocating for a shift from a transactional to a transformational economy. He underscored the necessity of creating a stable and attractive investment climate to foster sustainable economic growth.
Meanwhile, the reinstatement of the fuel subsidy is among the key demands of the ongoing nationwide protests. Despite this, President Tinubu, in a recent broadcast, dismissed the possibility of reintroducing the subsidy. He acknowledged the decision’s difficulty but defended it as necessary, describing the subsidy as a “noose around the economic jugular of our Nation” that had stifled economic growth and development.
This development highlights the complex challenges facing Nigeria’s economy and the need for strategic and well-considered policies to address them effectively.