Fuel subsidy ought to have been removed 10 years ago — Gov Otti

Abia State Governor, Dr. Alex Otti, stated on Thursday that President Bola Tinubu’s administration made the correct choice in eliminating fuel subsidies.

During his address as the 63rd Founders’ Day lecturer at the University of Nigeria in Nsukka, Enugu State, Dr. Otti emphasized that the absence of investment in local refining had severe economic repercussions, including job losses and hindrance to related industries’ growth.

He suggested that the Federal Government should have undertaken more thorough planning and communication prior to subsidy removal to shield the public from anticipated shocks.

Under the theme “Petroleum Subsidy Removal: Dealing with the Challenges, Harnessing the Opportunities,” he argued that the subsidy should have been removed a decade ago for sustainable national development.

Dr. Otti contended that the old system only sanctioned subsidy payments for imported petrol, benefiting elite businessmen capable of fuel importation. This setup, he claimed, fostered arbitrage, wastage, and corruption due to ineffective monitoring and manipulation by connected individuals in collusion with dishonest officials.

He also highlighted how the complexity of the subsidy system led to unscrupulous practices, ultimately burdening the poor who funded the lavish lifestyles of the rich and well-connected.

Governor Otti stressed the importance of clear and sincere communication in policy implementation, acknowledging that not everyone would agree with such decisions. He believed that better communication and education of the public about the issues involved could have mitigated the shock caused by subsidy removal.

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He cited examples from other countries, like Angola and Senegal, where governments strategically retained subsidies on essential items for the benefit of the poor.

Dr. Otti advocated for a comprehensive policy framework supporting specific needs, including subsidized mass transit, cash transfers, food assistance, and low-interest agricultural loans to help the urban and rural poor.

Expressing concerns about the worsening living conditions and rising poverty and unemployment resulting from subsidy removal, he called for robust policies to address these issues.

In his welcome address, the University’s Vice Chancellor, Professor Charles Igwe, praised Dr. Otti as a distinguished economist and resourceful manager, emphasizing the importance of discussing national and global issues.

The Chairman of the occasion, Professor Elochukwu Amucheazi, commended the University’s efforts in preserving the legacies of Nigeria’s founding fathers, particularly Dr. Nnamdi Azikiwe’s contributions to education and politics.