Nigeria Saves $20 Billion from Subsidy Removal and Forex Pricing Reform
Written by Olakunle Oke on November 24, 2024
Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has announced that the country has saved approximately $20 billion by removing petrol subsidies and adopting market-based foreign exchange pricing. This significant saving is equivalent to 5% of Nigeria’s Gross Domestic Product (GDP).
According to Edun, the removal of subsidies has not only saved the government a substantial amount of money but has also prevented individuals from exploiting the system to enrich themselves without adding value to the economy .
The minister emphasized that the saved funds will now be redirected into critical sectors such as infrastructure, health, social services, and education.
It’s worth noting that the removal of petrol subsidies has also led to a reduction in petrol consumption, from 1,600 trucks per day to 850 trucks per day. This reduction in consumption has also led to a decrease in cross-border smuggling of petrol.
Overall, the removal of subsidies and the adoption of market-based foreign exchange pricing have yielded significant benefits for Nigeria’s economy.
