A former minister of finance, Dr Kalu Idika Kalu, has said the wrong use of subsidies by past administrations had led to corruption in the oil sector.
“And the joker in the whole pack, we have never heard it being discussed because it is a very technical issue. Its exchange rate is running so much that domestic prices are dropping or foreign prices are increasing,” he said.He faulted the sustained mismanagement of the exchange rate, that as long as the naira equivalent of the dollar continued to change so fast, to compensate somebody who imported in dollar terms, the government had to give him the equivalent of the new Naira level.
Somebody has to give you that differential because the dollar is still the dollar. Then the next time it is N16.“So, if you have to compensate the guy importing it, you are encouraging him. The government cannot be importing this thing, it is private sector-led. But, the government as an entity knows that the system needs it.“If the government does not pay the subsidy, then the private sector would, but somebody has to pay for it.
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