Fuel subsidy removal saved Nigeria from bankruptcy, Tinubu declares

By Kazeem Ugbodaga

President Bola Tinubu on Friday defended his administration’s decision to remove fuel subsidy, declaring that the controversial policy rescued Nigeria from imminent bankruptcy and placed the economy on the path of recovery.

The President spoke in Lagos while hosting state governors who paid him a Sallah visit and joined him in celebrating the third anniversary of his administration.

Among those present were Governors Babajide Sanwo-Olu (Lagos), Abdulrahman Abdulrazaq (Kwara), Hope Uzodinma (Imo), as well as governors from Nasarawa, Jigawa, Sokoto, Kebbi, Taraba, Niger, Ekiti, Delta, Ondo, Edo, Adamawa, Benue, Enugu, Ogun and Kogi states. The deputy governors of Borno and Kano also attended the gathering.

Tinubu acknowledged that the removal of fuel subsidy triggered hardship for many Nigerians but insisted that the decision was necessary to avert fiscal collapse and restore economic stability.

According to him, successive administrations had spent vast sums on a subsidy regime that benefitted only a few while depriving critical sectors of the economy of much-needed investment.

“It was challenging at the time, but we survived. We faced litigation and accusations. We survived them. Instead of bankruptcy, Nigeria has survived. The economy has recovered. It is growing. Agriculture is booming,” the President said.

Reflecting on the last three years, Tinubu commended governors for helping to sustain public confidence in his administration despite the pains associated with the reforms.

“Many of you have survived and promoted the perseverance of many of our people, asking them to trust this government, and you have built that trust around one person: my leadership. I thank you very much,” he added.

The President said key economic indicators were beginning to reflect the gains of the reforms, citing improvements in infrastructure development, agriculture, housing and fiscal management.

He noted that governors were no longer relying on federal bailouts to pay salaries and meet basic obligations, describing it as evidence that the economy had been successfully reset.

“I’m glad governors are no longer borrowing from the federal government and asking for interventions and not knowing how to survive, how to pay salaries. You kept the spirit and the hope alive.

“Today, the benefits are showing. The economy has recovered. Macroeconomic indices are doing very well. Construction is ongoing on roads and infrastructure. The housing industry is coming on very well. Agriculture will prosper again,” Tinubu said.

The President also expressed optimism that Nigeria could achieve food sovereignty through effective utilisation of agricultural land across the states.

He assured Nigerians that his administration would continue implementing policies aimed at reducing hardship, creating jobs, boosting food production and ensuring inclusive economic growth.

Vice President Kashim Shettima praised Tinubu’s courage in confronting what he described as decades-long distortions in Nigeria’s oil sector through the removal of fuel subsidy.

“You did not come to power in the season of ease. You came at a time when the house required more than a carpenter; it required a builder with the courage to examine the foundation you inherited,” Shettima said.

“In that defining hour, you chose not to postpone the surgery. You chose not to massage the wound. You chose to confront the contradictions that have held this country hostage for 50 years.”

Also speaking, Chairman of the Nigeria Governors’ Forum and Governor of Kwara State, Abdulrahman Abdulrazaq, said the subsidy removal and accompanying fiscal reforms had significantly increased revenues available to states.

According to him, many state governments that previously depended on borrowing and bond issuance had become financially stronger and were now reducing their debt burdens.

“I think the nation was shocked by the audacity of Mr President to implement that serious policy, but today it has benefited immensely from that policy,” Abdulrazaq said.

“Many states were issuing bonds and borrowing money. Today, states are not going to borrow money. In fact, we are reducing our debt.”

He also called for discussions on raising the national minimum wage to at least N100,000.

Similarly, Chairman of the Progressive Governors Forum and Governor of Imo State, Hope Uzodinma, said Tinubu’s reforms had rescued the country from the brink of economic collapse.

“You have virtually recovered Nigeria from the brink of collapse to a state of stability and survival,” Uzodinma said.

“We have assessed your performance, Mr President, and I’m happy to announce that we have scored it 100 per cent.”

Earlier, Lagos State Governor Babajide Sanwo-Olu welcomed his colleagues to Lagos and thanked them for their continued support for the President, urging them to sustain the momentum as the administration pursues its reform agenda.

The fuel subsidy was removed by President Tinubu during his inaugural address on May 29, 2023, a move that sparked sharp increases in fuel prices and transportation costs but has remained one of the most consequential economic policies of his administration.