IMF clarifies fuel subsidy removal, “It was Tinubu’s decision”
The International Monetary Fund (IMF) has clarified that the removal of the fuel subsidy in Nigeria was a decision made solely by President Bola Tinubu and not at the behest of the organisation.
During a briefing in Washington D.C. on the sidelines of the IMF and World Bank Annual Meetings, Abebe Selassie, the IMF’s African Region Director, emphasized that the decision was domestic and part of the government’s economic reform agenda.
Selassie stated, “We don’t have programs in Nigeria. Our role is limited to regular dialogue, as we have with other nations like Japan or the UK.”
He added that President Tinubu’s declaration in May 2023, which announced the cessation of the fuel subsidy, was followed by a significant spike in fuel prices, escalating from approximately ₦200 to about ₦1,200 per litre across Nigeria.
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The removal of the subsidy, along with the floating of the naira, has led to a substantial increase in the cost of living, with inflation rates climbing to 32.72%.
This surge has made essential goods increasingly unaffordable for many Nigerians. In light of these economic challenges, President Tinubu has urged citizens to exercise patience and reaffirmed his commitment to the reforms, asserting they will yield long-term benefits.
The IMF has acknowledged the significant social costs of these reforms, calling for the Nigerian government to implement additional programs aimed at protecting vulnerable populations from the adverse effects.
“We recognise the significant social costs involved,” Selassie remarked. “The government can mitigate these by expanding social protection for the most vulnerable.”
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