The federal government of Nigeria has intimated that it has acquired a $800 million World Bank credit to address a portion of the country’s post-petroleum subsidy palliatives needs.
As previously announced, the current administration and the incoming government are currently discussing the withdrawal of fuel subsidies by the middle of this year.
Wednesday, following the weekly Federal Executive Council (FEC) meeting presided over by President Muhammadu Buhari at the State House in Abuja, the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, disclosed to reporters that the $800 million is the first tranche of palliatives to be disbursed through cash transfers to approximately 50 million Nigerians belonging to the most vulnerable segment of society.
According to her, “when we were working on the Medium-Term Expenditure Plan for 2023 and the Appropriations Act, we made that provision to allow us to stop fuel subsidies by June 2023. We’re on track, we’re engaging with various stakeholders, and we’ve gotten funds from the World Bank. This is the first tranche of palliatives that will enable us to provide cash transfers to the most vulnerable members of our society who are now listed on a national social register. This registration now contains a list of 10 million households. 10 million homes correspond to approximately 50 million Nigerians”
She noted that the government was willing to go beyond monetary transfers to help Nigerians adjust to the loss of subsidies.
Her words: “We also need to generate more funds to be able to do more than just cash transfers, and in our contacts with the various stakeholders, the variety of jobs we have exceeds the demand of simply providing cash transfers. Labour, for example, may want public transportation for its members.
So, we are still developing and working on a number of projects, some of which we may begin implementing immediately and others in the near future.
Ahmed responded, “$800 million for the scaling up of the National Social Investment Plan at the World Bank, and it’s secured and ready for this disbursement” when asked how much cash was received from the World Bank for the implementation of the scheduled withdrawal.
When asked if the incumbent government had discussed subsidy reduction with the next administration, the Minister responded, “There are several discussions occurring at various levels, including with members of the incoming government’s transition committee.”
On the secondary point of the elimination of gasoline subsidies, the Petroleum Industry Act makes this promise. There is a provision that states all petroleum products must be deregulated 18 months after the PIA goes into effect, which would be June 2023.