THE DOMESTIC AND INTERNATIONAL IMPLICATIONS OF FUEL SUBSIDY REMOVAL CRISIS IN NIGERIA

Abstract

A flip over from the economy is the issue of fuel subsidy removal, which many Nigerians felt very touchy about. Nigerians are disappointed that despite their disapproval of the plan, government has continued to promote it. There has been vociferous undaunted in trying to convince Nigerians to buy into the subsidy removal is the claim that the economy may crash if the subsidy as not removed. From the time Jonathan’s government brought up the issue of removing what it called subsidy on petroleum products after the 2011 elections, feathers had been ruffled both in the National Assembly, among civil society groups, the
opposition political parties, professional associations, and many other interests in the polity. Proponents of the subsidy posit that the subsidy has to go because we need the money to rebuild the economy. Opponents of the policy argued that there is nothing like subsidy ever existed in Nigeria, and that hat was surreptitiously being promoted by government as removal of subsidy was increase of petrol price under a deceptive guise. The paper, therefore, examines the implications of the subsidy removal on the economy in general and the populace in particular. To achieve this objective, the first section of the paper explores conceptual issues of subsidy and deregulation. The next section examines the theoretical framework of analysis upon which the conceptual issues are based. Neo-liberalism will be used in anchoring our thesis. The third segment discusses the implications of the policy on the economy and the Nigerian masses. The final section offers recommendations and concludes the paper.