Atiku’s fuel subsidy plan will scare away foreign investors, says IMPI
The Independent Media and Policy Initiative (IMPI) has warned that former Vice President Atiku Abubakar’s proposal to restore fuel subsidy could discourage foreign investment and undermine Nigeria’s economic stability.
The think-tank made the submission in a policy statement issued in Abuja on Tuesday by its chairman, Dr Omoniyi Akinsiju, titled, “Atiku’s Fuel Subsidy Restoration Campaign Promise Fails Litmus Test of Practicability and Sustainability”.
Akinsiju said Atiku’s proposed economic recovery plan sought to shift fuel subsidies from importation to domestic production by providing eligible public and private refineries with discounted crude oil, on the condition that the savings would be passed on to consumers.
He, however, described the proposal as complicated, arguing that it would subject commercial entities such as NNPC Limited and private refineries to politically determined pricing formulas and undermine the provisions of the Petroleum Industry Act (PIA) 2021.
“Atiku’s proposal also sends signals to global markets that Nigeria lacks regulatory predictability. This policy shift would scare away international capital and freeze modern Public-Private Partnerships (PPPs), with repercussions for funding critical legacy infrastructure projects and a damning effect on production and productivity,” he said.
Akinsiju also argued that fuel subsidy was a regressive economic policy because wealthier households with multiple vehicles typically consumed more petrol than poorer Nigerians who depended largely on public transportation or lacked access to electricity.
He said reintroducing price controls could also discourage marketers from supplying remote areas, potentially leading to fuel shortages and a resurgence of black-market activities. According to him, this could increase transport costs, worsen food inflation and further hurt rural farmers.
The IMPI chairman further warned that providing discounted crude to local refineries could reduce revenues accruing to the Federation Account, thereby limiting the resources available to state and local governments for infrastructure and essential services.
