By Adedapo Adesanya
The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, has presented the Accelerated Stabilisation and Advancement Plan (ASAP) designed to address key challenges affecting the reform initiatives and stimulate development in various sectors of the economy.
The document officially acknowledges that the government has continued subsidising premium motor spirit (PMS), popularly known as petrol, as it revealed that the “government is still supporting downstream consumption.”
“At current rates, expenditure on fuel subsidy is projected to reach N5.4 trillion by the end of 2024. This compares unfavourably with N3.6 trillion in 2023 and N2.0 trillion in 2022,” the plan noted.
This showed that the amount has ballooned to almost the amount paid in 2022 and 2023.
The presentation of the stabilisation plan to the President on Tuesday occurred about 48 hours after Mr Edun, during a television interview on Sunday, said a stabilisation package was underway to help the Nigerian economy.
Recall that President Bola Tinubu had recently reiterated that his administration removed fuel subsidies, with the oil minister, Mr Heineken Lokpobori also echoing his principal last month despite admissions from oil marketers, workers, and global institutions.
A draft copy of the plan presented to Mr Tinubu on Tuesday with an accompanying Executive Order to bolster the plan gave an insight into how the administration seeks to address some of the many problems which seem to be trying to torpedo its reforms, among others.
The plan is structured to advance President Tinubu’s economy-related eight priority areas and is broken down into Agriculture and Food Security Sub-Committee plan, Energy Sub-Committee plan: Oil, Energy Sub-Committee plan: Gas, Energy Sub-Committee plan: Power, Health and Social Welfare Sub-Committee plan, and Business Support Sub-Committee plan.
The document cited persistent high inflation, high interest rates which make it difficult for businesses to borrow, and a volatile exchange rate with the consequent uncertainty disruptive of economic activity, among others.
It also outlined the various sectoral challenges with specific remedial steps to be applied in addressing them.
It noted that Nigeria’soil sector is currently faced with problems of extensive pipeline vandalisation; high cost of production with 40 per cent cost premium above other jurisdictions; production level at 1.4 million barrels per day, below the budgeted level of 1.78 million barrels per day, thereby straining country’s fiscal position, adding that “government still supporting downstream consumption.”
The plan therefore recommended the immediate implementation of presidential directives (such as removal of signature bonuses) to attract investments, and support the achievement of Final Investment Decision (FID) for three identified blueprint projects in 2024 and for other projects enabled to attain FID by 2026.
