CNPP faults World Bank Over Removal Of Fuel subsidy

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THE Conference of Nigeria Political Parties (CNPP) yesterday faulted the World Bank for urging the President Muhammadu Buhari led administration to remove fuel subsidy.

CNPP’s National Publicity Secretary, Mr. Osita Okechukwu argued that experience over the years had shown that the adoption of such measures had always been counter-productive to the desired goal of achieving socio-economic growth in the polity.

CNPP in a statement entitled, “Fuel Subsidy Withdrawal: World Bank Again,” thereby urged Buhari to lay emphasis on fixing large scale intervention in critical infrastructure like roads, water, hospitals, railways and schools in the polity.

He argued: “30 years ago, the World Bank and its affiliate International Monetary Fund dished out conditionalities aimed at revamping Nigerian economy, among which is removal of subsidy on fuel and fertiliser, privatisation of state-owned enterprises and devaluation of the naira.

“World Bank, 30 years down the line, is at it again through its lead economist, John Litwack, calling for removal of fuel subsidy by admonishing that if the current regulated fuel prices are maintained it will spiral from 18 per cent in 2015 to 30 per cent of oil revenue in 2018.

“Mr. Litwack at the launch of the new edition of ‘Nigeria Economic Report’ maintained that if the government really meant to take a decision on the issue of fuel subsidy removal, the best time to act would be now that global crude oil price was at its lowest level.

He noted further “President Ibrahim Babaginda in coming to power in 1985, adopted the prescription and conditionalities of the World Bank and its affiliates dubbed Structural Adjustment Program (SAP)?

“The question is what’s the outcome of adoption of World Bank conditionalities? Answer – 30 years down the line the outcome is nothing but negative fallout – abject poverty, gross unemployment, pervasive corruption, debt burden, economic uncertainty and divided country.

“Whereas we agree with Litwack that, “The fuel subsidy appears to have vast modest benefits for the majority of citizens, but the costs are quite high,” and that,

“There is a strong tendency for the cost of the fuel subsidy to increase over time as increasing domestic demand for petrol outpaces growth in oil output or revenues. However we disagree that
“The $35 billion cost of the fuel subsidy during 2010 – 2014 was one of the reasons why Nigeria was unable to accumulate a fiscal reserve n the Excess Crude Account that could have protected the country from the recent oil price shock.” because it was fraudulently inflated.

He urged Buhari to distance himself from those who want him to abandon the people, by investing heavily in critical infrastructure, building medium and modular refineries, in order to halt the huge cost of importation of refined petroleum products, gross unemployment and create millions of employment.

Source: TheGuardian