FUEL SUBSIDY REMOVAL AS AN EFFECTIVE TOOL TO MAKE OR MAR THE NATION

      Fuel subsidy is an inducement offered by the government in order to reduce the price of fuel to make it affordable for it citizens. 

The history of the subsidy in Nigeria dates back to April 1992 when Ibrahim Babagida government raised the price of a liter of fuel from 15.3 kobo to 20kobo . He did it again in march 31 1986, from 20k to 39.5 k on April 10 1988, from 39.5k  on April 10 1988, from 39.5k to 42k. 

Subsidy in Nigeria works fine when government helps them continue to Operate and produce low- cost goods and services. By producing products at lower prices, consumers in the economy can continue to purchase them. 

Increasing consumer spending mostly brings an economy out of a recession of depression. Those measures also ensures that citizens have access to the goods and services they need at an affordable cost.

The removal of fuel subsidy was done on Monday 29 may, in his inaugural speech president Bola Ahmed Tinubu said Nigeria’s fuel subsidy would be scrapped, citing budgetary concerns. The decision led to a step rise in fuel prices and widespread panic-buying of fuel.

Removalof subsidy has prepared the mind of many producers from sudden rise in demand of products with lower prices that many producers may find very hard to meet which can lead to very high demand that causes an increase in prices.

WRITTEN BY: AISHA MUSTAPHA