Nigeria’s Dangote Group Chairman Urges End to Fuel Subsidy Regime

Nigeria’s richest man, Aliko Dangote, has called for an end to the country’s fuel subsidy regime, citing unsustainable costs and a need to align with international practices. In an interview with Bloomberg TV, Dangote, the Chairman of the Dangote Group, emphasized that the Nigerian government cannot afford to sustain the subsidy, which he believes is no longer necessary.

The fuel subsidy regime has been a contentious issue in Nigeria, with the government facing criticism for the high cost of maintaining the program. President Bola Tinubu had already declared an end to the subsidy during his inauguration speech in Abuja on May 29, 2023, leading to a subsequent increase in the pump price of fuel across the country.

Dangote’s comments come as the Nigerian government grapples with the economic implications of the subsidy regime. He argued that the country’s porous borders and high gasoline prices make it unsustainable for the government to continue providing subsidies. "Our price of gasoline is about 60 percent the price of our neighboring countries, and we have porous borders, so it is not sustainable," he said.

Dangote’s call for an end to the subsidy regime is likely to have significant implications for the Nigerian economy. The country’s fuel subsidy program has been a major drain on government resources, with some estimates suggesting that it costs the government around $2 billion annually. By ending the subsidy, the government may be able to redirect these funds towards more pressing priorities, such as infrastructure development and poverty reduction.

However, the decision to end the subsidy regime is also likely to have significant impacts on ordinary Nigerians, who may face higher fuel prices and increased transportation costs. The government will need to carefully manage the transition to a post-subsidy regime, ensuring that the benefits of increased efficiency and reduced costs are shared fairly among all stakeholders.

As the debate around fuel subsidies continues, Dangote’s comments serve as a reminder of the need for sustainable and responsible economic policies in Nigeria. With the country’s economy facing significant challenges, the government must carefully consider the implications of its decisions and prioritize the needs of its citizens.