Baron Ike

The federal government has said Nigeria’s revenues and foreign exchange earnings have dropped by about 60per cent since the COVID-19 pandemic, which spread with alarming speed, infecting millions and bringing economic activity across the globe to a near-standstill. 

Vice President Yemi Osinbajo stated this at the opening of the first-year Ministerial performance review retreat in Abuja.

“As a result of the poor fortunes of the oil sector, our revenues and foreign exchange earnings have fallen drastically. Our revenues have fallen by almost 60 percent”, Osinbajo said.

Also, at a joint briefing with the Minister of Power, Saleh Mamman and the Minister of State for Petroleum Resources, Timipre Sylva, Minister of Information and Culture, Lai Mohammed said the revenues losses prompted the federal government to take some difficult decisions to stop unsustainable practices that were troubling the economy.

While declaring that the government will not go back on fuel subsidy withdrawal and electricity tariff increase, the minister noted that as much as N10.413trillion was spent on fuel subsidy between 2006 and 2019 representing about N743.8billion per annum.

Mohammed also justified the recent hike on electricity tariffs, pointing out that government has spent N1.7trillion on electricity tariffs shortfalls and could no longer afford that.

The minister said: The government can no longer afford to subsidize petrol prices because of its many negative consequences. These include a return to the costly subsidy regime.

“With 60% less revenues today, we cannot afford the cost. The second danger is the potential return of fuel queues – which has, thankfully, become a thing of the past under this administration.

“The days in which Nigerians queue for hours and days just to buy petrol, often at very high prices, are gone for good. Of course, there is also no provision for fuel subsidy in the revised 2020 budget, because we just cannot afford it.”

He said that the federal government was not insensitive to the plights of Nigerians and the pains associated with higher fuel prices and electricity tariffs at this time.

“That is why we will continue to seek ways to cushion the pains, especially for the most vulnerable Nigerians.

“The government is providing cheaper and more efficient fuel in form of auto gas. Also, Government, through the PPPRA, will ensure that marketers do not exploit citizens through arbitrarily hike in pump prices.

“And that is why the PPPRA announced the range of prices that must not be exceeded by marketers”, he stressed.