The Federal Government has ruled out any return to fuel subsidies or the introduction of price controls, reinforcing its commitment to market-driven economic policies.
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Tuesday in Paris, stating that subsidy regimes distort the economy and will not be reinstated.
“We will not bring back subsidies because they create distortions in the economy, and we will not introduce price controls because we believe in markets while ensuring that regulation is responsible so that no supplier, trader, or manufacturer takes advantage of the Nigerian people,” he said.
Focus on Regulation, Not Price Control
Oyedele explained that while the government supports market-based pricing, regulatory oversight will remain in place to prevent exploitation across the supply chain.
He added that global developments, including tensions involving Iran, present both risks and opportunities for Nigeria, particularly in attracting energy investments and boosting revenue under current pricing conditions.
Inflation and Economic Context
Nigeria has experienced sustained inflationary pressure since the removal of petrol subsidy in May 2023. Data from the National Bureau of Statistics shows that headline inflation rose from 22.41 per cent in May 2023 to 34.19 per cent by June 2024, driven largely by increases in fuel, food, and transportation costs.
Tinubu Links Policy to FX Stability
Earlier, President Bola Ahmed Tinubu told investors that the removal of fuel subsidy has contributed to stabilising Nigeria’s foreign exchange market.
“Subsidy that was a burden to the entire country was removed, and ever since we have achieved FX stability,” he said in a statement released by his aide.
