Despite initial challenges faced by Nigerians over removal of subsidy on Premium Motor Spirit (PMS), experts in business and energy sectors have highlighted long-term benefits of the policy. Read the full story here:
Despite initial challenges faced by Nigerians over removal of subsidy on Premium Motor Spirit , experts in business and energy sectors have highlighted long-term benefits of the policy.Despite initial challenges faced by Nigerians over removal of subsidy on Premium Motor Spirit , experts in business and energy sectors have highlighted long-term benefits of the policy.
Head, Department of Economics, University of Ibadan, Prof. Adeola Adenikinju, said Nigeria has been under a subsidy illusion, which has imposed huge damage on the economy. He revealed that subsidy has made it difficult for government to have adequate funds for provision of basic social amenities and critical infrastructure.
He said government-controlled refineries are likely to be sold to the private sector or run like private sector companies, noting that the country would no longer spend N13 billion every month on refineries that are not producing and are inefficient. “The rich folks will pay for the fuel they consume, while some support will be provided for the poor, for instance, by diverting more government expenditures to social goods.
“There is a need to allow for more competition in the supply chain, especially in the issuance of import licensing. Importers should compete on freight charges, product costs and margins. He said government should practise regulatory impact analysis for intervention, noting that as fuel prices increase, transportation costs also skyrocket, leading to increased expenses that affect citizens’ cost of living.
“Business owners should consider operating hours, operational cost management, provide employee support, in terms of one-off allowance or hybrid working, seek affordable options with alternative energy sources and less energy intensive operations.”
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