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“When President Goodluck Jonathan was campaigning for votes and after he won election and was sworn-in on May 29, he promised Nigerians “Fresh Air” and also an inclusive government. He assured the citizenry that his administration was going to be a listening one.
With these promises, many thought that everything about his government was going to be democratically debated and majority voice respected.
Less than a year after, the democratic promises of the President are been put to play. The issue of subsidy removal is now putting to test the President’s pledge to be transparent. It initially started as a rumour and then it officially came out that the government is going to remove fuel subsidy.
According to the executive arm of the government, subsidy on petroleum must be removed because the ordinary masses are not benefitting and the money spent on subsidy is been corned by some “Cartel”.
Government says it spends an annual estimate of N1.3 trillion on subsidy and that it cannot continue to sustain that.
The House of Representatives has categorically voiced their objection to the planned subsidy removal, while the labour union also threatened to make the government ungovernable if it insists on removing the subsidy.
Last week, at the town hall meeting convened by the Newspaper Proprietors Association of Nigeria (NPAN) in Lagos, Nigerian masses expressed their objection to the proposed subsidy removal from fuel.
As government is insisting on subsidy removal, many people are asking who are doing pushing the President to go against the will of the people.
And as if to answer the question, as the debate on the subsidy gets heated, the Managing Director of the International Monetary Fund (IMF), Christine Lagarde came visiting.
The meeting was not just coincidental. Analysts believe it was predetermined. The IMF has been canvassing for the removal of subsidy among African countries.
For instance, the IMF has urged countries across West and Central Africa to cut fuel subsidies, which they say are not effective in directly aiding the poor, but do promote corruption and smuggling.
This pronouncement has seen governments in Nigeria, Guinea, Cameroon, Chad and Ghana moving to cut state subsidies on fuel.
Yesterday, Ghana cut subsidy and it was learnt that the development was due to pressure from the IMF to do so because of rise in the price of crude.
The Chief Executive Officer of Ghana’s National Petroleum Authority (NPA), Alex Mould said the cumulative effect of the rise in crude oil prices this year and the about 5.7 percent depreciation of the cedi meant a 25 percent increase in cedi terms in the cost of procuring crude oil and petroleum products since January.
The price change will see the cost of Liquefied Petroleum Gas (LPG) increase by 30 percent while petrol and diesel will go up 15 percent at pumps in Ghana.
Mould said Ghana has spent about 450 million cedis on fuel subsidies in 2011.
Ghana’s Minister for Finance Kwabena Duffour said the removal of subsidies would have a positive impact on Ghana’s economy.
Duffour said: “Subsidising fuel is not sustainable. It is the right thing to do so we can sustain our fiscal consolidation.”
This is the same music that the protagonists of subsidy removal in Nigeria, like the Coordinating Minister of Economy and Minister of Finance, Ngozi Okonjo-Iweala; the Minister of Petroleum, Diezani Alison-Madueke and the Governor of Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi are singing.
While Sanusi insisted that the economy would breakdown if the subsidy is not removed, Ngozi said Nigerians would be better off without subsidy.
Ghana’s subsidy removal yesterday confirmed people’s speculations that Western powers are behind the move to stop subsidy. Development in Ghana has also gone to confirm that the Nigerian government would boycott the public outcry on subsidy removal and go ahead to remove.
There is no provision for subsidy in the 2012 budget proposal submitted by President Goodluck Jonathan.
The Nigerian National Petroleum Corporation (NNPC) has said that from next year they would not pay for subsidy because there is no provision for it in the budget.
The development also negates the IMF’s saying that it does not tailor policies for any country to follow, but only provide technical supports.
But during the visit of Lagarde to Nigeria, she said, “I came here primarily to listen to our African members, and to find out how we can better tailor support to countries in this region in the current difficult global environment.”
Nigeria is indeed in serious economic problem. For instance, the value of the currency has been devaluing against major foreign currencies. The official value of naira against dollar is currently 156 to a dollar and at the Bureau De Change, it goes for 165 against the dollar.
The governor of central bank, Sanusi sometime this year faulted the IMF for suggesting that the value of the naira be devalued to protect further depreciation of the foreign reserves.
However, the governor bowed to pressure and got the naira devalued. It is the same pressure from the Western powers that is pushing the government to remove fuel subsidy.
In Nigeria, removal of subsidy would necessarily lead to hike in fuel pump and such hike would trigger increment in the price of other commodities and services.
It is already been speculated that by next year, when subsidy might have been removed, Nigerians would have to pay as high as N140 per litre of petrol. The price is currently N65 per litre.
What this means is that Nigerians should gird up for tough times next year. This is because any increase in the price of fuel would push the cost of production in the manufacturing industry up.
Also, cost of transportation would go up and even operators of Small, Medium Scale Enterprises would not be able to continue in business because most of them relied on generators to power their machines and generators are powered by fuel.
Some civil society organizations and organized labour are urging Nigerians to come out and protest subsidy removal. The question is, can Nigerians occupy the “Three Arm Zone” as Americans “Occupied” the “Street.”
Subsidy removal is turning out to be another Bretton Woods Institutions’ anti-peoples’ policy. It is a neo-liberal agenda developed by those in authority. It is not a popular idea but that of the ruling power. It is becoming a dominant idea because in every political setting, the dominant idea is the idea of the ruling power.
Now that the government is bent on removing subsidy from fuel against people’s outcry, the question to ask is if this is the “Fresh Air” that President Goodluck promised Nigerians during his campaigning?”
See also, see Ghana latest in Africa to cut fuel subsidies