Nigeria has announced plans to remove subsidies on fuel and electricity in 2022.
The country’s Minister for Finance, Budget and National Planning, Dr Zainab Ahmed disclosed this in Abuja, last Friday while giving a full breakdown of the 2022 budget.
She explained that the removal of subsidies was part of the overall step at addressing revenue leakages.
According to the Nigerian National Petroleum Corporation (NNPC), a total of ₦905.27 billion was spent on petrol subsidies in the last eight months.
The landing cost for refined crude in Nigeria is about ₦290 per litre; with additional charges, revenue margins for oil and gas marketers, it is expected that the price of petroleum products will reach ₦350/litre.
Investors in the Nigerian power sector are groaning over the rising cost of carrying on business due to the lack of a Cost-Reflective Tariff (CRT), rising inflation and fluctuating foreign exchange rates.
The rise in global crude oil prices will result in a crisis with the sector largely dependent on fossil fuels for electricity generation.
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“The government is in the process of fully deregulating the downstream petroleum sector which will end subsidies and free up funds for national development, including investment in renewables which will be part of the energy mix that ultimately powers our economy,” Chief Timipre Sylva, Minister for Petroleum Resources, said.
Source: https://energynewsafrica.com