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FUEL SUBSIDY REMOVAL: It’s untenable, Buhari tells IMF, W’ Bank, others

By Cross Udo
President Muhammadu Buhari has ruled out the possibility of heeding the calls of the International Monetary Fund, (IMF), the World Bank, and other leading economists for the removal of fuel subsidies.

The President also attributed Nigeria’s inability to meet its OPEC quota in crude production to the alleged criminal activities of the proscribed Indigenous People of Biafra, IPOB, in the oil-producing region, saying that the group is complicit in damage to pipelines and infrastructure.

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He similarly urged international partners to take steps by proscribing IPOB as a terrorist organization, lamenting that the leadership of the group enjoys a haven in the West, broadcasting hate speech into Nigeria from London, spending millions lobbying members of the US Congress, and freely using international financial networks to arm agitators on the ground.

These were contained in an interview the President granted Bloomberg News recently with the transcripts made available to newsmen by his media office.

Buhari in the interview explained why subsidy removal was unattainable.

Defending his government’s retention of fuel subsidy against the advice of the experts, Buhari said “Most western countries are today implementing fuel subsidies. Why would we remove ours now? What is good for the goose is good for the gander! What our western allies are learning the hard way is what looks good on paper and the human consequences are two different things.

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“My government set in motion plans to remove the subsidy late last year. After further consultation with stakeholders, and as events unfolded this year, such a move became increasingly untenable.

“Boosting internal production for refined products shall also help. Capacity is due to step up markedly later this year and next, as private players and modular refineries (Dangote Refinery, BUA Group Refinery, Waltersmith Refinery) come on board.”
•Alleges EU’s policies undermining food security in Africa

Fielding question on what his government was doing to ensure food security in the face of spiralling inflation, the President accused the European Union (EU) of encouraging the export of their subsidised food into Africa and therefore undermining the continent’s food sustainability efforts.

He said, “The EU’s policies, in particular, are all rhetoric of open trade – yet their Common Agricultural Policy subsidy programmes and export of those subsidized goods create dependence, undermine Africa’s self-sufficiency, and cause food poverty and starvation.”

Rating his performance in the last seven years on how he has been able to achieve his goal of fighting corruption, the President told his interviewers that he had been able to secure the country and repatriate looted funds because the nation’s international partners could trust his leadership.

He said, “We leave Nigeria in a far better place than we found it. Corruption is less hidden for Nigerians to feel empowered to report it without fear, while money is returned; terrorists no longer hold any territory in Nigeria, and their leaders are deceased, and vast infrastructure development sets the country on course for sustainable and equitable growth.

•Accuses IPOB of being behind pipeline vandalism
“In 2015, Boko Haram held territory the size of Belgium within the borders of Nigeria. Today they are close to extinct as a military force. The leader of ISWAP was eliminated by a Nigerian Air Force airstrike in March.

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“The jets acquired from the US and intelligence shared by the British were not provided to previous administrations and stand as a testament to renewed trust re-built between Nigeria and our traditional western allies under my government.

“We urge those same international partners to take additional steps costing them nothing, by proscribing another group – IPOB – as a terrorist organisation. Their leadership enjoys a haven in the West, broadcasting hate speech into Nigeria from London, spending millions lobbying members of the US Congress, and freely using international financial networks to arm agitators on the ground. This must stop.

“My administration is the only in Nigeria’s history to implement a solution to decades-long herder-farmer conflicts, exacerbated by desertification and demographic growth. The National Livestock Transformation Plan, putting ranching at its core, is the only way to deplete the competition for resources at the core of the clashes.

“Governors from some individual states have sought to play politics where ranches have been established, but where they have been disputes have dramatically reduced.”

He further said “Working with our international partners, hundreds of millions of various currencies have been returned from abroad – primarily from the UK, US, and Switzerland – and used as social and welfare funds distributed directly to the poorest during the COVID-19 pandemic and the provision of long-delayed infrastructure-roads, bridges, rail, and power.

“As an illustration, Monetary recoveries (January-December) 2021 show that more than N152bn has been recovered. Dollar recoveries for the year amount to over USD 386 million; GBP, more than 1.1 million; Euro, about 157,000; Saudi Riyals about 1.7 million some more in Digital and other currencies.

“Those partners refused to return these monies held for decades to previous Nigerian administrations in the certainty they would simply be re-stolen. They changed their approach with us because they knew my administration could be trusted.”

As for why as oil minister in addition to the president the country’s crude production continues slumping, with Nigeria unable to meet its OPEC quota for almost a year despite elevated prices and what he was doing to bolster output, he accused criminals and IPOB of being behind the ugly development.

According to him, “Four years ago, we unveiled plans for a new gas pipeline connecting Nigeria to Europe. Last week (2nd June) – in record time – the Nigerian National Petroleum Company (NNPC) entered into an agreement with the Economic Community of West African States (ECOWAS) for its construction.

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“Concurrently on 1st July the NNPC will become a Limited Liability Company and be subject to more robust auditing and commercial disclosure obligations. It will help stimulate investment and boost transparency, where corruption has deterred the former and stymied the latter.

“My administration is the first to pass this landmark reform in our oil and gas sector, after two decades of predecessors’ failure to do so – no doubt due to vested interests.

“Criminality and terrorism in oil-producing regions hamper production, and it would help if our western allies designated IPOB as a terrorist group, given their complicity in damage to pipelines and infrastructure.

“We have invested in our security forces, including the $1bn military deal with the U.S. for the acquisition of A-29 Super Tucano aircraft.
“These efforts are making an impact: wells that had to be closed due to criminality have now re-opened. With these efforts, OPEC has raised our quota for next month.”

•’Why I didn’t fire CBN governor, Emefiele, over presidential ambition’
For the first time after the ruling All Progressives Congress presidential primary, Buhari has given reasons why he did not fire the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, over his aspiration to contest for the highest office in the country.

Emefiele’s foray into politics had generated a lot of controversies which peaked with the Independent National Electoral Commission’s (INEC) threat to withdraw storing sensitive election materials with the apex bank.

However, speaking on why he has refused to sanction Emefiele for showing interest in contesting for President ahead of the 2023 general elections while still in office, the President said “The CBN governor is appointed by the President. But this appointment is subject to confirmation by the Nigerian Senate.

“Ultimately, it will be for the CBN’s board of directors to determine whether a CBN governor’s actions have fallen foul of the laws in place to ensure he can most effectively carry out his duties.”

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•Insecurity
Asked to assess his performance in the fight against insecurity, Buhari said he had been able to recover territories hitherto held by the Boko Haram insurgents and depleted their ranks adding that his administration’s execution of vast infrastructural projects had set the country on the course of sustainable and equitable growth.

Asked if there was anything his administration could do to boost tax collection since Nigeria has one of the lowest tax-to-revenues ratios in the world, he said:

“Though we have the largest economy in Africa, it is true that translating that wealth into revenue generation is challenging. We raised VAT in 2020, and the IMF wanted us to raise it further, but this is a complex issue that cannot be addressed by tax hikes alone.

“Around 80% of Nigerians work in the so-called informal economy – a situation exacerbated by the pandemic. It is difficult to tax the informally employed, and no country has yet found an adequate solution.

“Still, we are striving to find one, including the rollout of a national ID card which has grown from 7 million in 2015 to between 90-100 million today – including a tax code and, at the same time combined with access to various government services.

“In 2016 I launched the Presidential Enabling Business Environment Council (PEBEC), making Nigeria an easier place to start and grow a business. PEBEC’s policies, as with our national ID card rollout help integrate the informal sector.

“We also work closely with ECOWAS to implement initiatives like the Support Programme for Tax Transition in West Africa (PATF), improving the management of domestic taxation and ensuring better coordination of taxation in the ECOWAS and West African Economic and Monetary Union (WAEMU) regions.”

 

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