The Nigerian government should scrap fuel and electricity subsidies, the International Monetary Fund (IMF) has prescribed. “Fuel and electricity subsidies are costly, do not reach those that most need government support and should be phased out completely.”The Nigerian government confirmed last month that it will pay N1.6 trillion (nearly $1.1 billion) to subsidise electricity in 2024. “Immediately, it adopted two policy reforms that its predecessors had shied away from: fuel subsidy removal and the unification of the official exchange rates. “Between late May and June, only a few weeks after he was sworn in, President Tinubu decided to remove the governor of the CBN, devalue the local currency to a level closer to its fair value and phase out the country’s costly fuel subsidies. Of interestNigeria: Scrapping fuel subsidy will spur e-mobility market – report“Faced with the possibility of growing inflation and nationwide protests, a covert petrol subsidy was reintroduced.

Source: The North Africa Journal February 14, 2024 16:11 UTC