NNPC Calls for an increase in Pump Price of Fuel: Caution, Caution and Caution !
Attention to all the advisers of our dear, respected and highly esteemed President Muhammadu Buhari!!
A major Concern by a Concerned Citizen on issue of Important Concern that concerns every Concerned Citizen of Nigeria!!!
Everyone that knows me can testify clearly and confidently of my genuine love for my dearest, darling, and highly esteemed country, Federal Republic of Nigeria. Essentially, this write up is written in good faith out of concern for the well-being of the our country and her wonderful people. This is not to antagonize or sabotage the laudable efforts of Government but to Patriotically Passionately and Explicitly elaborate the grave consequences of upward review of fuel pump price at this critical time in the country.
Growing up, I have served nobly as one of the National Students’ Leaders and National Youth Leaders in this country, seeking for betterment of the country her people. We fought Military Government victoriously, and embraced enthronement of Democracy in the country. To this end, this Democratic Dispensation should be jealously protected for Prosperity and Posterity
Recently, I have engaged Nigerians both home and abroad constructively on Nation Building Processes and National Development.
In summary, I am a Major Player in Nation’s Affairs with very strong Local, National and International Influence and networks.
I gave this above background to validate the fact that I am a Critical Stakeholder in Nigeria Project with optimal knowledge and understanding of the current situation in the country and to demonstrate the fact that I am eminently qualified and competent to comment of the Subject Matter of Pump Price of Fuel, besides my B.Sc and M.Sc Degrees in Economics.
Presently, Nigerian Economy is characterised by the following:
*High and Rising level of Unemployment and Underemployment,
* High and Rising level of Poverty,
* High and Rising level of Dependency Burdens,
* High and rising rate of Inflation,
* Diminishing value of the country’s currency due to continued devaluation of Naira against other major currencies, ( Weak Exchange rate)
*High and Rising rate of Population growth,
*High and Rising level of Rural – Urban Migration,
*High and Rising level of Income Inequality,
* Inelastic demand for imported goods,
* Heavy reliance on imported raw materials,
* Exportation of Primary commodities,
* Infrastructural inadequacies
*High cost of Energy,
* Low level of Industrial Development,
* Under Utilisation of Productive Capacities,
* High Interest rate.
Besides these unpleasant Economic conditions elucidated above, there are other Social, Political, Demographical, Ecological, Medical and Environmental challenges currently faced by country in addition to current Security situations.
To this end, any hike in pumping price of fuel in these current situations identified above will result in untold hardship for the generality of the People.
Reasons why Pump Price of Fuel should not be reviewed upward now:
* The nation is yet to recover from Covid 19 Pandemic.
*Recent Devaluation of Naira has already made Nigerians poorer compared to other countries as more Naira is required for the same amount of other currencies.
*The country is yet to recover fully from End SARC Protest.
* Government is making serious effort, with different social intervention initiatives to take people out of Poverty, hiking Fuel price will return them and others to Poverty net.
*There are Security Challenges currently in the country.
* There is high crime rate already in the country. High cost of living occasioned by hike in fuel pump price can force some undecided people into crime .
* Any Nationwide protest due to hike in Pump Price of Fuel could be highjacked for destructive tendencies.
*Several people are just managing and enduring, any form of further hardship can result in disaster for such categories of people.
* Manufacturers, Industrialists and Businesses may lay off some staff due to increase in cost of production and cost of doing business occasioned by hike in fuel pump price.
What will happen immediately fuel price is reviewed upward:
* Cost of Transportation will go up,
* Cost of food will go up,
*Cost of goods and services will go up,
*Cost of flight will go up,
* School fees will go up,
House rent will go up,
*Cost of doing business will go up,
*Cost of production will go up,
*Cost of running government will go up,
*Inflation rate will rise again,
*Purchasing power will be weakened,
*Poverty level will deepen,
* Crime rate will increase,
*Insecurity will rise,
* Agitation for new minimum wage and wages increment will rise,
* Nationwide strike / protest may loom.
It is important to note here that Nigerian workers do not earn International Deregulated Salaries but Regulated Subsidized Salaries compared Internationally.
Also, an increase in International Price of Crude Oil results in an increase Government income. As such, this should be a blessing to the Citizens rather than a burden of corresponding hike in local price of fuel due to an increase in International Price of Crude Oil.
There is always a wisdom solution to every problem if we are sincere, think deep and reason Logically, Analytically, Methodology, and Strategically.
To find lasting and sustainable solutions to this situation, there is a need for short term, medium term and long term strategic actions
The best and enduring action is for Government to put a mechanism and policy in place to stop Importation of fuel. It doesn’t make any Economic or Business sense for the country to export Crude Oil and later import Fuel. Apart from increasing the cost of imported fuel due to extra cost associated with Importation / exchange rate, Importation of finished goods is exportation of jobs. To this end, there should be a definite plan to end Importation of fuel and encourage local refinery. This is long term strategic plan with a definite time lag.
However, in the main time, government should review the landing cost of imported fuel and eliminate unnecessary cost associated with the Importation at reducing landing cost of imported fuel.
Finally, since the increase in International price of Crude Oil increases Government revenue, rather than people suffering and bearing the burdens of this at home, Government should set up a stabilization fund from extra revenue accrued from an increase in Crude Oil price from International market to stabilize the gap as a result of an increase price of Imported fuel due to an increase in International price of Crude Oil.
It is important to assert here that,
since the emoluments of the people are not deregulated but static and inelastic, imposition of deregulated prices of fuel can only weaken purchasing power and deepens poverty level.
Dangote Refinery will soon be ready and Nigeria will not import fuel anymore but export. Therefore, the payment of subsidy claimed by NNPC is a temporary measure and should not be use to bring about lasting negative effect of generality of the people.
NNPC belongs to all 206 Million people of Nigeria and should be able to bear the temporary burdens from the extra revenue from an increase in International Price of Crude Oil rather then passing the burdens to Nigerians.
Blackson Olaseni Bayewumi.
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