The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, on Monday confirmed that Nigeria’s revenue had dropped by about 65 per cent as the COVID-19 pandemic impact on the economy lingers till now.
The minister explained that the dwindling revenue trend necessitated the decision of the federal government to discontinue the payment of petrol subsidy.
Ahmed, who made this disclosures on NTA’s ‘Good Morning Nigeria’ programme, explained that if the petrol subsidy was sustained, it would lead to fuel scarcity and fiscal crisis as government will not be able to pay marketers.
The minister clarified: “What we have been doing is not sustainable. If we bring back fuel subsidy, we will fail because we will not be able to pay it and the problem of disputes with marketers will come back, then we will have queues again. We just cannot afford it and therefore this deregulation must be made to work.
“We appeal to Nigerians to understand that in the past when subsidy was done, we could afford to do it but right now, we cannot pay. Remember that right now our revenue has gone down by about 65 per cent. So, it is not business as usual. We cannot do what we used to do anymore”, she added.
Noting that the country is currently facing difficult times like many other countries around the world, Ahmed insisted that the deregulation of the pricing regime in the downstream sector would not be reversed.
On whether fuel subsidy will be returned if the price of crude oil recovers and Nigeria earns more from crude exports, Ahmed said this would not be feasible based on the government’s fiscal stance and the need to save funds for development generally.