Fuel Subsidy Removal: Messing With the Middle Class


ANNOUNCING A CALLOUS POLICY WITH IMPUNITY

A liberalization move by the government to deregulate the downstream sector of the oil industy by removing subsidy on petrol was announced on Sunday 1st January, New Year’s Day just when Nigerians were reeling from the shock of deadly bomb attacks on Christmas day and a spate of sectarian killings in Ebonyi state, the South-East of Nigeria. This unilateral decision by the Executive arm of government took Nigerians by surprise as it was meant to take immediate effect, and as government was supposed to be conducting “wide consultations” with stakeholders on the controversial and highly unpopular policy decision, and even as the National Assembly was yet conclude deliberations on the issue.

NIGERIANS TAKE TO THE INTERNET… AND TO THE STREETS

Despite our renowned resilience and almost legendary perseverance in any situation, the removal of subsidy seems to have been the proverbial straw that broke the camel’s back. We took to the internet, especially Facebook and Twitter to express our vehement disapproval of this insensitive policy and its callous and untimely implementation on New Year’s Day. That same afternoon, people started mobilizing on social media for mass protests the next day in Abuja, Lagos, Kaduna and other cities across the country. Even the leading opposition parties and professional associations like the Nigerian Bar Association and the Nigerian Medical Association issued strongly worded statements condemning this move in its entirety and threatening mass action.

Most Nigerians are particularly incensed because this policy is not only highly unpopular, but also because the government has had little consultation with the public. After the last (public) meeting it had with the media and some stakeholders in Lagos in December where people expressed their extreme disapproval, government promised to continue consultations before fuel subsidy would be removed from either January 20th 2012 or April 2012. The government’s unilateral decision on New Year’s Day which appears to be a stealthily well-planned siege on Nigerians has further heightened Nigerians’ extreme distrust for the government and vindicated our view of government officials as highly duplicitous. Most importantly, Nigerians are infuriated by the immediate effect of this policy which has resulted in inflation in transport fares, food stuff and basic commodities by as much as 200% as fuel prices have increased from N65 ($0.48) to over N140 (almost $1) per litre. In some places like Calabar, fuel is reportedly sold for over N200 per litre.

In Lagos the commercial capital, mass protests began on Monday which were largely peaceful:

In Abuja the capital city, scores of youths led by a former Federal Legislator, Dino Melaye on Monday marched to Eagle square carrying placards and signed a protest register. The police tried to foil the protest and to confiscate the protest register but they later returned it. Several protesters including Melaye were arrested by the police and taken to the Anti-robbery Squad but were later released.

In Kaduna on Monday, scores of protesters gathered at Murtala Square to peacefully sign a protest register but were later dispersed by anti-riot policemen.

In Kano, the turn out, just like in Lagos was huge. Hundreds of protesters turned out en masse on Wednesday 4th January and even spent the night at Silver Jubilee round about which was christened Kano “Liberation” Square.

In several other cities across the country, scores and even hundreds of protesters have been pouring out onto the streets as the pictures below show: from Kebbi, Katsina and Bauchi in the North, to Ibadan, Akure and Benin in the South. Nigerians are angry and are not hiding it.

The two images above are from the Northern city of Katsina.

These two images above are from Benin city, the capital of Edo state, one of the states in the President’s home region, the Niger-Delta.

The image above is a picture taken of Ijaw youths (from the President’s ethnic group) protesting the removal of Subsidy on Wednesday 4th January.

Protesters in Bauchi in the North East, at the Emir’s palace. Unconfirmed reports later stated that the Emir joined the protesters in marching through the city.

Abeokuta, Ogun state.

Ibadan, Oyo state.

WHAT ARE THE DEMANDS?

The demands of Nigerians basically centre on the reversal of this decision: mainly restoring fuel subsidy, cutting government waste, tackling corruption, provision of infrastructure, repairing the ailing refineries and building new ones. While many protesters have been calling for the President’s resignation and indeed the popular use of the term #OccupyNigeria by protesters could mistakenly give that impression, there are really no explicit political goals from protesters. The protests are simply an expression of indignation at a policy which will and is already bringing untold hardship on Nigerians. The labour unions – the Nigerian Labour Conress (NLC) and Trade Union Congress (TUC) have given the government an ultimatum to reverse the decision by Monday 9th January or face nation-wide protests which would shut banks, schools, offices, oil installations, airports etc and effectively cripple the economy.

This video below sufficiently captures and encapsulates the demands of many Nigerians:

TECH-SAVVY YOUTH MOBILIZE… AND BROADCAST TO THE WORLD

With a population well over 150 million people, Nigeria is reported to have over 43 million Nigerians (educated middle to upper class) on social media sites like Facebook and Twitter and connected to the internet. Nigerian youths have mobilized to take to the streets and challenge the government’s unpopular decision. In the face of scant media coverage and even blackout towards the protests by government owned television and radio stations like the Nigeria Television Authority (NTA) and some government friendly newspapers, it is social media savvy youth who have broadcasted images and updates to both local and international media. Citizen reporters on ground tweet pictures, videos and live updates of events and use Facebook, Youtube and blogs. These updates are sent to local and international media like Channels TV, BBC Africa, CCN i-report, Al-Jazeera stream and others using the hashtags #FuelSubsidy and #OccupyNigeria. Notable citizen journalists and activists include Sahara Reporters, Japeth Omojuwa, Kayode Ogundamisi, Gbenga Sesan and scores of others.

In an ironic, but not surprising twist of fate, President Jonathan’s Facebook page which he and his advisers have severally used to brag about his social media savvy-ness and popularity has been bombarded with tens of thousands of highly critical messages by his Facebook fans expressing raw fury and emotion, with some comments bordering on downright insults and curses. President Jonathan seems to have set the record as the “most cursed person on Facebook

THE GOVERNMENT’S OBSTINACY, HALF-TRUTHS AND MANIPULATION 

Knowing the Nigerian government’s antecedents of its brazen disregard for the feelings of ordinary Nigerians, its actions, statements and responses to the mass opposition and protests against its deregulation policy since New Year’s Day did not disappoint in the least bit. It only served to vindicate Nigerians’ massive distrust and growing disdain for government officials. Here are some instances:

The Minister of Labour, Chief Chukwuemeka Wogu in his reaction, on Channels TV, to the threat by Labour Unions to embark on massive strikes said: “As a government, you don’t succumb to threats or pandering… from the people you rule…” You can watch the video clip HERE.

Ahmed Ali Gulak, a Special Adviser to the President on Political Affairs, in an interview with the BBC World Have Your Say programme on Wednesday 4th January claimed that “majority of Nigerians are in support of the removal of subsidy” to which a Nigerian, Nicolas Adikwe, present at the BBC studio countered and said it was an “insult” to Nigerians out on the streets, and that it was misleading.

The Central Bank Governor, Sanusi Lamido Sanusi and the Minister of Finance and Coordinating Minster of the Economy Dr. Ngozi Okonjo Iweala (believed to be the arrowhead of this allegedly IMF-backed policy) have rehashed the same well worn-out economic arguments to justify subsidy removal, albeit with complete detachment from the reality of the Nigerian socio-political environment.

The government in an emergency cabinet meeting on Wednesday has stated that it remains firm and resolute on this decision and will not reverse it.

GOVERNMENT BRUTALITY AND REPRESSION

While protests have been largely peaceful, the government has in some cases used violence to brutally repress peaceful protests.

In Lagos, this video shows a protester being beaten and brutalized by the police:

In Ilorin, witnesses say an unarmed protester; Muyideen Mustafa was brutally shot by the Police on Tuesday, while Police Officials claim he was stabbed by protesters. He was the first casualty of the protest and his remains have been laid to rest.

In Kano, though the police behaved well on Wednesday towards the protesters, they waited until the early hours of Thursday from around 02.00am local time to lay a cowardly late night ambush on protesters, beating them and firing tear gas cannisters. It was a hair-raising moment for social media users keeping tabs on the events in Kano as most liaisons and citizen reporters giving live updates from the Silver Jubilee roundabout (Liberation Square) in Kano were unreachable for several minutes. An estimated 40 people were reported to have been injured.

In Ibadan, protesters, mostly students were tear-gassed by security forces.

UNITY IN DIVERSITY: A SERENDIPITY

One of the most remarkable serendipity of sorts to have occurred so far is a growing sense of unity amongst Nigerians hitherto known to be deeply divided along ethno-religious lines. Perhaps the shared sense of frustration, anger and oppression by a ruling class cutting across most ethnic and religious groups is finally uniting Nigerians and achieving what political scientists, sociologists, historians, religious leaders, donor agencies, countless government committees and integration policies have failed to achieve.

This bond and unity was most evident in the city of Kano, hitherto a hotbed of inter-religious squabble, where Christians on Wednesday 4th January stood guard to protect Muslims as they prayed. A mutual agreement for peace was said to have been reached between Muslims and Christians where Muslim would protect all non-Muslims and escort them to their places of worship and vice-versa. They vowed to resist any attempt to use religion to divide them with a register opened to that effect.

Similarly in Kaduna, an agreement is reported to have been reached between Christians and Muslims today (Thursday 5th January). The photo below shows Christians surrounding and protecting Muslims as they pray.

It is too early to tell whether this bond would grow stronger and whether it would be replicated in other parts of the country, but it certainly is a welcome development

“EMINENT” AND “RESPECTED” RELIGIOUS LEADERS: MUM IS THE WORD

As some Nigerians are gradually uniting over their shared sense of frustration, virtually nothing has been heard from most of the prominent Islamic and Christian leaders, neither on the fuel subsidy removal, nor the mass protests enveloping the entire country. With the exception of local imams, pastors and some catholic bishops, “eminent” leaders such as the Christian Association of Nigeria (CAN) President Ayo Ortisejafor, the Sultan of Sokoto, the Jama’atul Nasril Islam (JNI) and others who are usually very vocal towards many national and political issues have surprisingly maintained a deafening silence on this. You tend to wonder…

A SENSE OF HUMOUR, AGAINST ALL ODDS

Trust us Nigerians. Our resilience always unleashes bursts of creativity and even humour, as these pictures and video show:

“Praying”  that water turns to  fuel?

FINALLY, A NIGERIAN “ARAB SPRING”?

So is this the start of a Nigerian “Arab Spring”? There are certainly a number of similarities with the uprisings in the Arab world: a shared sense of anger and frustration; a growing unity amongst hitherto divided people; protests mobilized by an educated, sophisticated and tech-savvy youth; wide use of social networking and growing support for the protests and so on. However, as mentioned earlier, there are no overt political goals yet as most Nigerians simply want a reversal of this policy. Therefore, the labour unions could reach a compromise with the government as is usually the case with unpopular government policies. What seems to be different this time around though, is the widespread anger and disenchantment by the public and also that Nigerians poured out onto the streets without waiting for the go ahead from the NLC/TUC. Nigerian youths also for the first time in a long time feel as if they are really part of something, by expressing their displeasure and protesting. It remains to be seen how things pan out in the next few days.

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25 thoughts on “Fuel Subsidy Removal: Messing With the Middle Class

  1. This is a complete summary of the mess our dear country is right now. Thumbs up zainab and I hope all our efforts will not go in vain…

    • Thanks Aminu. Yeah, we are all praying and hoping that something good comes out of all this… its so difficult to predict how things could turn out though… for better or for worse.

  2. This is a complete summary of the mess our dear country is in right now. Thumbs up zainab and I hope all our efforts will not go in vain…

  3. An interesting account of the events of the last 4 days from an intelligent and tech-savvy blogger. Zainab you never disappoint.
    Thumbs Up

  4. Another good one, Zainab. What you have just proved here is that the anti-fuel subsidy removal is a universal movement in Nigeria, one which transcends regional or any other sectional consideration. The protest marches have shown that, contrary to certain commentaries, Nigerians are capable of uniting under an issue of mutual interest. The biggest challenge now is sustaining the tempo of these agitations until our tyrannical rulers have buckled under the weight of rejection by majority of Nigerians. Let us not forget that the general strike will begin on Monday. That will be the acid test for both sides: will the trade unions lead the rest of Nigerians in sustaining the tempo of this rejection, culminating in forcing the government to rescind its thoughtless decision, or will the authorities laugh last?

  5. A well written piece and a compact summary of events that have transpired since the news of subsidy removal broke out. I think the world should read this; please give approval to share the article. Football has always been our unifying factor but the dismal performance of our national teams in recen times has deepened the division. The reactions of people to attacks waged on churches on Christmas day brought out the frail bond holding us as a nation. However in a sudden twist of event, we had buried those differences in a twinkle of an eye. The pangs inherent in the removal of subsidy were too severe to absorb and required a united front to confront which necessitated the new found love amongst Nigerians. I hope the love stays!

  6. Zainab Usman; Pls read this paper. The term Washington Consensus was coined in 1989 by the economist John Williamson to describe a set of ten relatively specific economic policy prescriptions that he considered constituted the “standard” reform package promoted for crisis-wracked developing countries. These policies were advocated by Washington, D.C.-based institutions such as the International Monetary Fund (IMF), World Bank, and the US Treasury Department.[1] The prescriptions encompassed policies in such areas as macroeconomic stabilization, economic opening with respect to both trade and investment, and the expansion of market forces within the domestic economy.
    History
    [edit] Original sense of the term: Williamson’s ten points
    The concept and name of the Washington Consensus were first presented in 1989 by John Williamson, an economist from the Institute for International Economics, an international economic think tank based in Washington, D.C. [1] Williamson used the term to summarize commonly shared themes among policy advice by Washington-based institutions at the time, such as the International Monetary Fund, World Bank, and U.S. Treasury Department, which were believed to be necessary for the recovery of Latin America from the economic and financial crises of the 1980s.
    The consensus as originally stated by Williamson included ten broad sets of relatively specific policy recommendations:[1]
    1. Fiscal policy discipline, with avoidance of large fiscal deficits relative to GDP;
    2. Redirection of public spending from subsidies (“especially indiscriminate subsidies”) toward broad-based provision of key pro-growth, pro-poor services like primary education, primary health care and infrastructure investment;
    3. Tax reform, broadening the tax base and adopting moderate marginal tax rates;
    4. Interest rates that are market determined and positive (but moderate) in real terms;
    5. Competitive exchange rates;
    6. Trade liberalization: liberalization of imports, with particular emphasis on elimination of quantitative restrictions (licensing, etc.); any trade protection to be provided by low and relatively uniform tariffs;
    7. Liberalization of inward foreign direct investment;
    8. Privatization of state enterprises;
    9. Deregulation: abolition of regulations that impede market entry or restrict competition, except for those justified on safety, environmental and consumer protection grounds, and prudential oversight of financial institutions;
    10. Legal security for property rights.
    Although Williamson’s formulation emphasizes the role of the Washington-based agencies in promoting the above agenda, a number of authors have stressed that Latin American policy-makers arrived at their own packages of policy reforms primarily based on their own analysis of their countries’ situations. Thus, according to Joseph Stanislaw and Daniel Yergin, authors of The Commanding Heights, the policy prescriptions described in the Washington Consensus were “developed in Latin America, by Latin Americans, in response to what was happening both within and outside the region.”[2] Joseph Stiglitz has written that “the Washington Consensus policies were designed to respond to the very real problems in Latin America and made considerable sense” (though Stiglitz has at times been an outspoken critic of IMF policies as applied to developing nations).[3] In view of the implication conveyed by the term Washington Consensus that the policies were largely external in origin, Stanislaw and Yergin report that the term’s creator, John Williamson, has “regretted the term ever since”, stating “it is difficult to think of a less diplomatic label.”[4]
    A 2010 paper by Nancy Birdsall, Augusto de la Torre, and Felipe Valencia Caicedo likewise suggests that the policies in the original consensus were largely a creation of Latin American politicians and technocrats, with Williamson’s role having been to gather the ten points in one place for the first time, rather than to “create” the package of policies.[5]
    In Williamson’s own words from 2002:
    More specifically, Williamson argues that the first three of his ten prescriptions are uncontroversial in the economic community, while recognizing that the others have evoked some controversy. He argues that one of the least controversial prescriptions, the redirection of spending to infrastructure, health care, and education, has often been neglected. He also argues that, while the prescriptions were focused on reducing certain functions of government (e.g., as an owner of productive enterprises), they would also strengthen government’s ability to undertake other actions such as supporting education and health. Williamson says that he does not endorse market fundamentalism, and believes that the Consensus prescriptions, if implemented correctly, would benefit the poor.[8] In a book edited with Pedro-Pablo Kuczynski in 2003, Williamson laid out an expanded reform agenda, emphasizing crisis-proofing of economies, “second-generation” reforms, and policies addressing inequality and social issues (Kuczynski and Williamson, 2003).
    The term Washington Consensus has been used to capture the general shift towards free market policies that followed the displacement of Keynesianism in the 1970s. In this broad sense the Washington Consensus is sometimes considered to have begun at about 1980.[9][10] Many commentators see the consensus as having been at its strongest during the 1990s, particularly if interpreted in the broader sense of the term. Some have argued that the consensus ended at the turn of the century, or at least that it became less influential after about the year 2000.[5][11] More commonly, commentators have suggested that the Consensus survived until the time of the 2008–2009 global financial crisis.[10] Following the strong intervention undertaken by governments in response to market failures, a number of journalists, politicians and senior officials from global institutions such as the World Bank began saying that the Washington Consensus was dead.[12][13] These included former British Prime Minister Gordon Brown, who following the 2009 G-20 London summit, declared “the old Washington Consensus is over”.[14] Williamson was asked by the Washington Post in April 2009 whether he agreed with Gordon Brown that the Washington Consensus was dead. He responded:

    Criticisms of the Washington Consensus policies
    Most criticism has been focused on trade liberalization and the elimination of subsidies, and criticism has been particularly strident in the agriculture sector. Though, in nations with substantial natural resources, criticism has tended to focus on privatization of industries exploiting these resources.
    The policies were originally conceived largely as a conservative response to crises in Latin America, but as of 2010, several Latin American countries are led by socialist or other left wing governments, some of which—including Argentina and Venezuela—have campaigned for (and to some degree adopted) policies contrary to the Washington Consensus policies. Other Latin American countries with governments of the left, including Brazil, Chile and Peru, have, in practice, adopted the bulk of the policies included in Williamson’s list, even though they criticize the market fundamentalism that these are often associated with. Also critical of the policies as actually promoted by the IMF have been some US economists, such as Joseph Stiglitz and Dani Rodrik, who have challenged what are sometimes described as the ‘fundamentalist’ policies of the IMF and the US Treasury for what Stiglitz calls a ‘one size fits all’ treatment of individual economies. According to Stiglitz the treatment suggested by the IMF is too simple: one dose, and fast—stabilize, liberalize and privatize, without prioritizing or watching for side effects.[24]
    The reforms did not always work out the way they were intended. While growth generally improved across much of Latin America, it was in most countries less than the reformers had originally hoped for (and the “transition crisis”, as noted above deeper and more sustained than hoped for in some of the former socialist economies). Success stories in Sub-Saharan Africa during the 1990s were relatively few and far in between, and market-oriented reforms by themselves offered no formula to deal with the growing public health emergency in which the continent became embroiled. The critics, meanwhile, argue that the disappointing outcomes have vindicated their concerns about the inappropriateness of the standard reform agenda.[25]
    —Professor Dani Rodrik, Harvard University
    The critique laid out in The World Bank’s study Economic Growth in the 1990s: Learning from a Decade of Reform (2005) [26] shows how far discussion has come from the original ideas of the Washington Consensus. Gobind Nankani, a former vice-president for Africa at the World Bank, wrote in the preface: “there is no unique universal set of rules…. [W]e need to get away from formulae and the search for elusive ‘best practices’….” (p. xiii). The World Bank’s new emphasis is on the need for humility, for policy diversity, for selective and modest reforms, and for experimentation.[27]
    The World Bank’s report Learning from Reform shows some of the developments of the 1990s. There was a deep and prolonged collapse in output in some (though by no means all) countries making the transition from communism to market economies (many of the Central and East European countries, by contrast, made the adjustment relatively rapidly). More than a decade into the transition, some of the former communist countries, especially parts of the former Soviet Union, had still not caught up to their 1990 levels of output. Many Sub-Saharan African’s economies failed to take off during the 1990s, in spite of efforts at policy reform, changes in the political and external environments, and continued heavy influx of foreign aid. Uganda, Tanzania, and Mozambique were among countries that showed some success, but they remained fragile. There were several successive and painful financial crises in Latin America, East Asia, Russia, and Turkey. The Latin American recovery in the first half of the 1990s was interrupted by crises later in the decade. There was less growth in per capita GDP in Latin America than in the period of rapid post-War expansion and opening in the world economy, 1950-80. Argentina, described by some as “the poster boy of the Latin American economic revolution”,[28] came crashing down in 2002.[27][28]
    Among other results of the recent global financial crisis has been a strengthening of belief in the importance of local development models as more suitable than programmatic approaches. Some elements of this school of thought were summarized in the idea of a “Beijing Consensus” which suggested that nations needed to find their own paths to development.

  7. The wogu man really annoyed me.. He is feeling like a ruler abi? People they rule? That’s the problem these leaders don’t know they are there to serve.. They shud first cut all their over-inflated salaries and corruption before they even think of touching the subsidy

  8. Nice account of the “reaction” to the removal of the subsidy. However, a couple of things:
    1. Can you please remove the picture of the dead protester Muyideen Mustafa? – I think he deserves some dignity in death and let him rest in peace. You can do him more justice by looking round to see if you can find a picture of him alive to go with the story.

    2. You have only addressed the reaction of the removal and not really the “necessity” for the removal.

    In my (probably lone) opinion, it is not so much the removal of the subsidy that I am against, rather I feel the measure has not gone far enough; it may sound cruel, but let me explain:

    When a government chooses to pursue a liberal economic policy (as Mr Jonathan appears to be attempting), it should do so unconditionally without half measures – i.e it should go all the way with an economic shock therapy. unfortunately this is not what is happening right now – let’s ask ourselves, what percentage of the actual cost of the old price is actually subsidized? some will probably say 50% or more (using the simple argument of: a litre of fuel now costs twice as much)- but they will be wrong, truth is: less than 10%! What the government use to subsidize, was the so called “Bridging Cost” which amounts to about =N= 6 a litre . There are other bits and bobs that add up to give the actual pump price of a litre of oil of course, but I am not going to bore you with it, not least because I am not an expert in this!, however needless to say that these bits and bobs have still been retained in the new pricing structure (though slightly adjusted) – Now back to the point: What Jonathan should have done,as insensitive as it may sound, was to completely liberalize the entire pricing structure and let the forces of demand and supply determine the optimum price, rather than “setting” a new price – The problem (or one of the many) with our country is that we are very short sighted and focused on the “now” and pay very little attention to planning for the future. If we had removed the subsidy a long time ago and allowed the price to float freely and liberalized other sectors of the economy, we “probably” would have been in a much better state economically than we are now; we HAVE TO start somewhere, as painful as the short term effects might be. Of course I am not ignorant of the fact that the money that will be saved from the removal will probably be misappropriated nor ignorant of the fact that a significant majority will be negatively impacted, but at least the president has shown that he is bold enough to make some tough economic decisions, I hope he doesn’t back down and lets hope that some keen investors are watching- It is a start, but he needs to make even tougher decisions about other sectors of the economy rather than using a “drip drip” approach which only prolongs the pain. I think most people or free market thinkers will agree (putting emotions aside) with the position that: building any strong economy or society, requires a form of self denying ordinance of the most extreme kind, and the willingness to put up with temporary evils on the basis of the subtle and sophisticated understanding that unless you do something about it NOW, then we will be going nowhere as a nation, and 20 years from now, we will still be talking about our incompetent “past” leaders!.

    • Thank you for your comment. And thanks for the observation and suggestion that the gory picture of the slain protester be removed. While you are certainly correct to note that I only addressed the “reaction” of the removal of fuel subsidy and not the “necessity”, I did however, in a previous article titled: “The Unanswered Questions on Fuel Subsidy Removal” reflect on some of the key issues of the fuel subsidy debate, and what I perceived to be the main reason why Nigerians are against it. You can read it here: https://zainabusman.wordpress.com/2011/12/13/the-unanswered-questions-on-fuel-subsidy-removal/

      First of all, let me state that I am one of those free-market skeptics, because from the little research I have done on the free market and neo-liberal economic system, and also from the opinion of an increasing number of (international) development economists, I have come to realise that there is really no such thing as a free market.

      Coming down to the debate on fuel subsidy removal, you said ” Of course I am not ignorant of the fact that the money that will be saved from the removal will probably be misappropriated nor ignorant of the fact that a significant majority will be negatively impacted”. If you know for a fact that the money WILL be misappropriated and that a significant majority (of Nigerians?) WILL be negatively impacted, then wouldn’t the purpose be defeated? It means however good the policy is, corruption will make sure it doesn’t yield the desired results. Why not tackle corruption first, so that the policy decision then would be guaranteed to be effective? Isn’t this a case of putting the cart before the horse?

      • Why not tackle corruption first? Because it requires an almost radical “re engineering” of the way the society thinks, corruption has become part of the fabric of the society, to the point that people cannot remember when it was otherwise – you can tackle (minimize) corruption, but only under an authoritarian system and not in a democracy – You cannot eliminate corruption, but you can institute policies that change the economic incentive of corruption for example: we all know one of the reasons our refineries do not work is because it pays more for some individuals to import than have the crude locally refined, why? well for starters because our government pays part of the cost associated with importing fuel! The banks benefit from extending the letters of credit and the interest associated with such instruments- easiest way of tackling this, is by making it more expensive to import fuel (raise the landing costs, storage cost etc – basically eliminating some of the subsidy and taxing whatever gets through UK style) i.e making the economic incentive not in their favor – I believe in the short run, yes there will be some misappropriation, however the long term benefits far outweigh any short term pain, we just need the foresight to see beyond the bleeding obvious.

        PS: Yes, the Government could have done more in educating the masses – but it is rather difficult trying to explain the benefits of starving overnight for a full breakfast the following morning, not least if you have been starving most of your life.

    • People seen to think we have a problem with the removal, but I think Its not matter of d removal off of d subsidy that is d problem for most nigerians but their of mistrust of the government and what they say the money will be used for. What is stopping some of the greedy leaders from channelling those so called revenue into their own pockets and we have come to know that they always do?

      Second of all as long as their is nothing to balance out this fuel removal subsidy (FSR), be it constant light, free health care or free Education or massive increase in the basic salary of Nigerians, it can not work, it just can not work. Nigerians on a good day were already ‘managing’ their lives as it is and the government goes and does this on the most harshest of the months, where every one has not even recovered from the Holiday break after spending all their money just shows you how in human our leaders are. Nothing and I mean nothing works in my country electricity, Education, Transportation, health care, judiciary just to name a few, they people are hungry, angry, unemployed, disillusioned and the government goes and does this?

      They say will get worse before they get better, but my question is that was anything ever better in the first place? Rise I’d the price of everything and I mean everything, if we thought unemployment was high before just wait for the fall out private sector will do mass sacking cos they can’t pay salaries and maintain the cost of running d business, d only employer of labour will be the Government. God help Nigeria

  9. Another good one here Zainab. I relish the flow and the way the rather distressing story is captured to give it a light mood that keeps one glued to the end.

    You have provided a befitting response to Mouky but I think some things still need to be made clearer.

    First, the request that the slain protester’s picture be removed is nothing but absurd. How do you tell me the story of someone killed in a protest and present a life picture of him? The highest honour that can be given the young man is to spread the picture so that the world can bear witness to the brutal outcome of Jonathan’s ‘dictatorship’.To hide or remove the picture of his gruesome murder is to crush some of the evidence.

    Secondly, I would like us to ask some questions… would the Nigerian government have to subsidize fuel to such a large degree if the refinaries in Nigeria were fully operational? Does the heavy cost not arise from the fact that Nigeria exports crude oil and imports refined fuel? Would a befitting solution to the problem not be by beginning to make sure that Nigeria refines her own oil so that foreign exchange can be made from exporting refined rather than crude oil?

    Finally, I want to say that President Jonathan’s actions should not in the least come as a surprise. When the winds of fortune place a charlatan at the reins of power in a country as big and powerful as Nigeria, the much they can do is destroy themselves, destroy the polity or destroy both themselves and the polity!

    I think Nigerians should let only the first option come to fruition.

    • Re point 1: I don’t want to sidetrack, but a beautiful narrative can still be written without a gory picture to go with it..I am simply of the opinion that his family don’t need to see his last moments replayed over and over again.

      Point 2: Most countries subsidize the fuel consumed, otherwise the cost of exploration will be prohibitive (The US subsidizes domestic fuel by about $4 Billion or more annually) – so even if all our refineries are operating at 100% capacity, we will still need a form of subsidy to make affordable. Don’t forget only part of the “downstream” subsidy has been removed, the upstream subsidy for the big oil exploration companies is still in place – Again, it has everything to do with providing an economic incentive for exploration…there are many oil wells with proven reserves that have been abandoned simply because the cost of extracting them, outweighs any profits that can ever be realized from developing them (you may have heard stories a decade or so ago about oil discovery near the Lake Chad basin in Borno? – well it was abandoned because of prohibitive cost of extraction (as urban legends go))

  10. Zainab, you have written quite well – tongue in cheek I might add. Very lovely and objective. You have done some great job.
    Truly I think that the fuel subsidy issue has gone from ‘right/wrong’ to an issue of the government wanting to claim that it is BOSS.
    I have stated everywhere I am writing that our early definition of democracy from elementary school was government of the people by the people for the people… Amazing how that translates in the Nigerian situation.
    Our leaders really are being heartless.
    Also, they call for sacrifice but they are not sacrificing anything. Are they having slashes in any allowance? Are they now saying they would buy their fuel?
    It is really sad. That all Nigerians devoid of our usual tribal, ethnic and religious sentiments are together shows one thing: THE TRUE VOICE OF THE PEOPLE.
    Gaskiya, I can’t claim to know the full workings of the Economics of Fuel Subsidy, however, I have felt it in harsh terms and some dying…(http://sueddie.wordpress.com/2012/01/04/fuel-subsidy-101/)…It is not wrong as Mouky says but I think there are several things that must be put in place before such is done…before then,…Well,
    I truly wonder when our government would start listening…
    Over all, Zainab, keep the good work and let’s see some more…would you be taking the voice to the streets?

  11. can we see beyound the price increse? is there anything the president is loosing control of or is there an external force at work?

  12. The reality of the matter is that, the removal of fuel subsidy can lead to what we called “stagflation” in Political economy(low production, high inflation and individual economic aridity).The mistakes made by the federal Government was the failure to serielised strategic planing that can persuade and convince Nigerians on the rational behind the removal of fuel subsidy.The strategic plans should be gradual and in phases;not abruptly.And again, the job to lobby and persuade Nigerians on the issue must be left with competent political and lobbying consultants that can plan and design the rigth rhetoric that can persuade and convince Nigerians on fuel subsidy removal.Second,the government must try to build trust in the mind of Nigerians. It’s the current PDP Federal government that created mistrust in the mind of majority of Nigerians;on the issue of shifting the party’s candidature from the core north to the south-south of Nigeria.And at the time of insecurity in the whole country then government came up with another agenda;the fuel subsidy removal which will affect (negatively) every sector of economy.So the real question now is what will be the out-come result of this dispute between 99% of Nigerians and the government?

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