Abia State Governor, Dr. Alex Otti, has said that the removal of fuel subsidy by the administration of President Bola Tinubu was the right decision for Nigerians.
He explained that lack of investment in local refining has had severe economic consequences, including job losses and hampering of the growth of related industries.
Otti, who spoke as the 63rd Founders’ Day lecturer of the University of Nigeria, at Nsukka (UNN), Enugu State, said that the Federal Government should have embarked on more strategic planning and communication before removing the subsidy to insulate the public from the anticipated shocks.
While speaking on the theme: ‘Petroluem Subsidy Removal: Dealing with the Challenges, Harnessing the Opportunities’, he said that the petrol subsidy should have been removed 10 years ago to place the nation on the path of sustainable national development.
He argued that the old arrangement only approves subsidy payments for imported petrol and that the major beneficiaries were elite businessmen who can pool the resources to go into fuel importation.
This system, according to him encouraged arbitrage, waste and other forms of corruption as a result of the absence of effective monitoring and reporting systems and deliberate manipulation of the system by connected individuals in connivance with dishonest officials.
Otti also stated that complexities of the subsidy regime encouraged a lot of unwholesome practices and in the end, rather than benefit from the extensive outlay as had been originally intended, the poor ultimately find themselves funding the extravagant lifestyle of the rich and highly connected.
“One thing I have learnt in communicating policies and plans is that you can never get everyone to agree with your proposals.
“However, sincere and clear communication, using various channels would help on two fronts: buy you genuine public support and give your audience an opportunity to understand your intentions better.
“The removal of fuel subsidy was clearly the right decision and should have been done about ten years ago or earlier but even then, I am of the considered opinion that more could have been done to insulate the public from the anticipated shocks.
“Being a policy that would introduce shock into the system, I believe it should have been communicated better. I do not think that much was done to properly educate the public on the issues at stake”, he said.
Advocating for a more comprehensive policy framework to support specific areas of needs as identified by the World Bank, the governor cited examples from other nations, like Angola and Senegal, where governments strategically retained subsidies on essential products for the poor.
He stated that measures such as subsidized mass transit, cash transfers, food assistance, and low-interest agricultural loans should have been considered to support the urban and rural poor.
He expressed concerns that the removal of the subsidy had exacerbated living conditions for citizens and called for the immediate implementation of robust policies to address rising poverty and unemployment.
In his welcome address, the Vice Chancellor of the University, Professor Charles Igwe, said that the lecture is aimed at creating an opportunity for serious reflections and discussions on issues of national and global interests, adding that the honour of delivering the Founders’ Day lecture is reserved for persons of uncommon achievements.
I was the guest lecturer for the 63rd Founder’s Day celebration organized by the University of Nigeria, Nsukka. My lecture centred on the theme: “Fuel Subsidy Removal: Dealing with the Challenges, Harnessing the Opportunities.”
During my lecture, I analysed the various aspects… pic.twitter.com/wTjcDmioTr
— Alex Otti (@alexottiofr) October 5, 2023
Describing Governor Otti as a first-class economist, banker and versatile manager of men and resources, the vice vhancellor noted that the lecturer belonged to the special family of alumni of the university having bagged an honorary doctorate degree of the institution. (BUSINESS HALLMARK)
