NNPC says fuel subsidy behind Nigeria’s rising poverty, lists benefits of removal

The Nigerian National Petroleum Company (NNPC) Limited said fuel subsidy is behind the rising poverty rate in Nigeria, where 133 million citizens are multidimensionally poor.

According to the senior business advisor to Mele Kyari, the Group Chief Executive Officer (GCEO) of NNPC, Lawal Musa, the payment of subsidy has prevented the government from providing multiple road networks, well-equipped health centres and stable electricity supply in Nigeria.

Musa explained at an event organised for the National Association of Nigerian Students (NANS) in Abuja that the N4.8 trillion spent on petrol subsidy annually could be invested into real estate, building 500,000 new houses.

He also stated in reports on Friday that the fund could be disbursed to skill up two million Nigerian students, construct 7,500 kilometers of road network at the cost of N400 million per kilometre.

Read also:NNPC set to post over N674bn profit, far behind Saudi Aramco’s $161.1 billion

Other investments he said the government could use the funds for are building 37 well-equipped 120-bed tertiary health centres at N32 billion per hospital annually, as well as building and equipping 2,400 hospitals in 774 local government areas.

Musa said these were the benefits of deregulating the oil industry or removing fuel subsidy. He also stated that additional 27,000 megawatts of electricity could also be generated with the subsidy money.

He further stated that: “Nigeria is the largest producer of crude oil in Africa, possessing 28 percent of Africa’s reserve, with petroleum contributing significantly to the country’s economy.”

The benefits derived have over the years been eroded due to the amount paid on subsidy, a regime [that] has been fuelling the vicious circle of poverty in the country,” he added.

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