Founder/President of Dangote Group, Aliko Dangote and a political economist cum management expert, Prof Patrick Okedinachi Utomi have expressed variant opinions on Fuel Subsidy removal
Dangote who spoke to Francine Lacqua during a Bloomberg Television interview in New York yesterday, said the “time is right” for Nigeria to end paying subsidy on fuel. Dangote who spoke
He said: “Subsidy is a very sensitive issue. Once you are subsidising something then people will bloat the price and then the government will end up paying what they are not supposed to be paying.
It is the right time to get rid of subsidies.” Dangote said petroleum products consumed about 40 per cent of Nigeria’s foreign exchange.
He stated that fuel from his 650,000 barrels per day capacity refinery at Free Zone, Lekki, Lagos, which started supplies on September 15 to the Nigerian National Petroleum Company Limited (NNPC Ltd) for domestic sale could actually stabilise the naira.
However, Prof Utomi in a recent interview, said the reintroduction of fuel subsidy was of essence. He highlighted that many countries including the United States subsidised productivity.
Utomi, also a Fellow of the Institute of Management Consultants of Nigeria, advised President Bola Tinubu against succumbing to whatever figure that suggests that fuel pump price should be hiked. Utomi said: “President Tinubu needs to recognize essential things that Nigerians need fuel for. I will subsidise whatever it is we use to call it.
“I do not care what you call it whether I will bring back subsidy or not. There is subsidy, and there will be subsidy. Americans have subsidies for agriculture.it is a matter of where you direct it to. Is it something that will produce, that will help us rebuild?
“If it is something that will help us produce and rebuild, I will subsidise but if it is something that we will vigorously consume, I will not do that and I will show an example. “If you take the number they throw at and say jerk up prices by so much, you will just be burdening the people who are overburdened
What you need when investment is not taking place is to free up money for savings and investment. If you cannot save and you can not invest, it is just a vicious circle going down. We need serious reflection on where we are in the process and what we must do first. That is a sequencing problem and we are not managing that properly.
That is why it is so hard on people.” The Lagos Business School Professor said it was imperative to curb alleged corruption in the downstream sector and fuel management. While making a case for reintroduction of fuel subsidy, he warned against introducing measures that would subsidise consumption.
He also warned against unscrutinized holistic adoption of economic prescriptions from the Bretton Woods Institutions: the World Bank and the International Monetary Fund (IMF). Utomi said: “When you get into the kind of situation that we are battling, you need a lot of planning. Because we did not do all the necessary planning and put the appropriate measures in place because we did not clarify our strategy, we are running into very serious problems.