Obasanjo: Tinubu’s Fuel Subsidy Removal Was Premature

Former President Olusegun Obasanjo has revealed that the fuel subsidy, which the President Bola Tinubu-led Nigerian government claimed to have abolished in 2023, has been reinstated due to soaring inflation. This contradicts Tinubu’s declaration during his inaugural address on May 29, 2023, that the fuel subsidy had been permanently removed.

The removal of the subsidy led to a significant increase in petrol prices, from around N200 to over N600 per litre. In an interview with the Financial Times, Obasanjo criticized the government’s approach, arguing that measures should have been put in place before the subsidy was removed. He pointed out that the subsidy has effectively returned due to the current high inflation rate.

“There’s a lot of work that needs to be done. Not just wake up one morning and say you removed the subsidy. Because of inflation, the subsidy that we have removed is not gone. It has come back,” Obasanjo said.

He also emphasized the need for investor confidence in Nigeria, stating, “You have to go from a transactional economy to a transformational economy.” One of the key demands of the ongoing nationwide protests is the reinstatement of the fuel subsidy regime.

However, in a recent Sunday broadcast, President Tinubu categorically ruled out the possibility of reviving the fuel subsidy. He described the decision to remove the subsidy as “painful but necessary,” emphasizing that it had been a major obstacle to economic growth and development, likening it to a “noose around the economic jugular of our nation.”