By Emmanuel Iruobe
VENTURES AFRICA – After five months of deliberations, the Nigerian National Assembly has passed a N4.49 trillion ($23 billion) budget for the 2015 fiscal year last week. However, it failed to make provisions for fuel subsidies. While the non-allocation for subsidies may have resulted in long queues during the past week, a total removal might actually eliminate the increasingly frequent scarcities.
Nigerians, last week, played witness to another period of scarcity of petroleum products due to ongoing strikes by the Major Marketers Association of Nigeria. This is the fourth time locals are experiencing this in 2015. The strike came on the heels of a three-day deadline given by the association within which all outstanding debts owed them by the Federal Government were to be settled. In the heat of the crises, motorists were seen spending an average of 12 hours queuing at petrol stations while side-marketers (black market traders) wereselling for as much as N300 ($1.8), up from the original N87 ($0.44).
Most of the disputes that have led to the scarcity stem from the delays in subsidy payment from the Nigerian government. This implies that an elimination of the melee between marketers and the government should put an end to scarcity.
Many Nigerians are aware that the fuel subsidy regime is unsustainable. Reports indicate that about N1.29 trillion ($6.79 billion) was spent on these subsidies in the past two years. This has contributed to the current high public debt stock of the country. However, if the latest budget deduction is anything to go by, the end of the subsidy regime is even closer than most envisage.
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