FG Defends Reforms, Says Savings From Fuel Subsidy Removal Redirected To Debt Payments, Others
Nigeria's Finance Minister Taiwo Oyedele defended recent economic reforms, stating that fuel subsidy savings were redirected to debt servicing and social programs. He rejected IMF criticism regarding poverty levels, arguing that temporary income declines were necessary for long-term growth.
Why it matters
Explains the rationale behind controversial economic policies in Nigeria that have significantly impacted the cost of living.
The Federal Government has said that it will soon publish details of how savings from the removal of fuel subsidy have been spent.
It said that savings from the removal of fuel subsidies and foreign-exchange market reforms have largely been absorbed by higher debt-servicing costs and increased government spending, as government officials labour to defend reforms blamed for worsening living conditions.
Speaking at the African Emerging Markets Forum in Abuja on Wednesday, Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said fuel subsidies and what he described as an implicit foreign-exchange subsidy had cost Nigeria roughly five per cent of GDP before their removal.
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