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Nigeria has secured $800 million from the World Bank to help cushion the impact of the removal of fuel subsidy

According to Ahmed, the $800 million is the first tranche of palliatives ready to be delivered in cash to 10 million families.

“There’s a provision (of the Petroleum Industry Act) that says 18 months after the effectiveness of the PIA that all petroleum products must be deregulated. That 18 months takes us to June 2023,” the minister said.

“Also, when we were working on the 2023 Medium Term Expenditure Framework and the Appropriation Act, we made that provision to enable us to exit fuel subsidy by June 2023. We’re on course, we’re having different stakeholder engagements, and we’ve secured some funding from the World Bank, which is the first tranche of palliatives that will enable us to give cash transfers to the most vulnerable in our society that have now been registered in a national social register. Today, that register has a list of 10 million households. 10 million households are equivalent to about 50 million Nigerians,” she added.

This year, Africa’s largest economy put aside 3.36 trillion Naira ($7.3 billion) for petrol subsidies until mid-2023, after which it has made no provision for the expenditure, which is greater than its spending on healthcare and education.

According to Ahmed, the administration is exploring cash transfers and mass transportation buses for employees to alleviate the impact of subsidy reduction on the most disadvantaged part of the population.

She said that the country has registered 10 million homes, equating to 50 million vulnerable individuals. “Several things are still on plan,” Ahmed told reporters following the government’s cabinet meeting in Abuja.

On the withdrawal of the subsidy, Ahmed stated that negotiations were taking place at various levels of government as well as with members of President-elect Bola Tinubu’s incoming cabinet.

After withdrawing a fuel subsidy in June, Labour Minister Chris Ngige suggested that Tinubu’s incoming administration provide public sector workers salary raises this week. Tinubu will take over when Buhari goes down in May.

Many Nigerians see cheap subsidized petrol as at least one advantage from the state, which fails to provide other essential amenities like power and security despite collecting billions of dollars from oil exports each year.

The Nigerian government for months now has floated the idea of the removal of fuel subsidies and each day, said removal looks more and more like an impending reality. Some Nigerians already had a glance at what the removal of fuel subsidies would look like and needless to say, they blatantly rejected the idea.

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