The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, revealed that Nigeria spends $600 million monthly on fuel importation.
He stated this during an interview on AIT’s Moneyline programme, noting that this high import bill stems from neighboring countries, extending to Central Africa, benefiting from Nigeria’s fuel imports.
The interview, posted on AIT’s YouTube channel on Wednesday, highlighted Edun’s explanation for President Bola Tinubu’s removal of the fuel subsidy, noting the country’s lack of precise data on internal fuel consumption.
The National Bureau of Statistics disclosed that Nigeria’s petrol imports have been reduced to an average of one billion liters monthly since President Tinubu eliminated the fuel subsidy on May 29 of the previous year.
Edun remarked, “The fuel subsidy was removed May 29, 2023, by Mr President, and at that time, the poorest of 40 per cent was only getting four per cent of the value, and basically, they were not benefitting at all. So it was going to be just a few.”
Emphasizing the country’s fuel consumption issues, he stated, “Another point that I think is important is that nobody knows the consumption in Nigeria of petroleum. We know we spend $600m to import fuel every month but the issue here is that all the neighbouring countries are benefitting. So we are buying not for just for Nigeria, we are buying for countries to the east, almost as far as Central Africa. We are buying. We are buying for countries to the North and we are buying for countries to the West. And so we have to ask ourselves as Nigerians, how long do we want to do that for and that is the key issue regarding the issue of petroleum pricing.”
Edun stressed the need for a decisive approach to address this issue, which hampers the nation’s economic growth.
He highlighted the government’s commitment to the welfare of its citizens, particularly the vulnerable, focusing on ensuring food availability and affordability.
The finance minister also clarified that the N570 billion fund release to state governments occurred last December.
He explained, “This actually refers to a reimbursement that they received from December last year onwards and it was a reimbursement I think under the COVID financing protocol but the point is that the states have received more money. They have received more money. Mr President has charged to ensure food production in the states.”
Regarding the recent increase in the maximum borrowing percentage in the Ways and Means from five to ten percent, Edun assured that this does not imply reliance on the Central Bank of Nigeria for financing.
He emphasized, “We have not gone to the central bank to say, please lend the government money to pay its debt, to pay its salaries. That’s Ways and Means. We have not gone. In fact, we have used market instruments to pay down what we owed, and that is a very, very germane aspect of having a strong economy.”
He described the National Assembly’s approval as a fail-safe measure, saying, “Sometimes it just gives that extra flexibility so that if a payment needs to be made and there’s a mistiming, there’s a gap between the time at which the revenue will come in and the expenses needed, you can just draw down briefly. So, the aim is to keep within the letter of the law, I think that’s the main point.”
Reiterating the administration’s commitment to Nigerians’ welfare, Edun underscored the importance of ensuring food availability and affordability. He explained the measures taken, including utilizing reserves and permitting controlled importation only after exhausting local supplies.
He assured, “So, one of the conditions for this importation will be that everything available locally in the markets or with the millers and so forth has been taken up. We will have auditors that will check that.”
These interventions aim to reduce inflation, stabilize exchange rates, and lower interest rates, fostering a conducive environment for investment and job creation.
