According to him, the long-term benefits to the country would outweigh the pain, he stressed.
Dafinone, an economist and a renowned chartered accountant, maintained that there would never be a time fuel subsidy removal in the country would not bring about its associated but temporary pain to the citizens.
The Senator-elect while speaking with journalists in Warri, Delta State, on the impact of the petroleum subsidy removal, following the announcement by President Tinubu, in his inaugural address, charged Nigerians to, “look at the brighter side of the policy as government would rechannel the funds hitherto spent on fuel subsidies to affect the health, education, power, police, infrastructure, and other critical sectors positively.”
He maintained that the alleged lack of transparency in the management of the petrol subsidy in the past led to the strident calls for the subsidy removal despite the hardship that it would bring to the populace.
Consequently, Dafinone enjoined Nigerians to “be prepared to adjust to the painful future reality of buying fuel at higher prices,” adding, “No matter how long the decision is postponed, it is a hard decision that Nigeria must take as a nation, as the government cannot devote such a significant proportion of the annual budget to fund the fuel subsidy,” he insisted.
The politician who is also a former Chairman, Manufacturers Association of Nigeria Export Promotion Group pointed out that, “while the impact of the subsidy removal is immediate; the benefits that the country would derive through the redirection of the about N400billion spent monthly on Subsidy (according to NNPC records), would take about six months to one year to be felt by the populace”.
The remarked further that the timing of the subsidy removal is in adherence to the budget approved by the outgoing administration as the 2023 budget makes no provision for petrol subsidy for the second half of the year.
“President Bola Ahmed Tinubu only emphasised the policy change announced by the past administration,” he explained.
Concluding, Dafinone maintained, “His (Tinubu’s) statement removes the uncertainty on a major component of government expenditure and would no doubt reassure our external creditors.
“I have also heard some people arguing that the President would have waited for the Dangote Refinery to be fully operational before the removal of the fuel subsidy.
Whilst I congratulate Alhaji Aliko Dangote for the success of the refinery project, the fact remains that the impact of the Dangote refinery selling its products in the Nigerian market would be marginal in terms of the cost of fuel at the pumps in Nigeria.
“It is most likely that the Dangote Refinery will buy crude in US Dollars at global oil prices and will also sell to the Nigerian market in Dollars (or the Naira equivalent). However, it will be marginally cheaper than what is obtained internationally because shipping and other landing costs would not be a factor in the price build-up.
“The Dangote Refinery is billed as an export refinery, and needs to sell its products at competitive prices to enable them to pay back facilities from international and local lenders.
“The removal of the fuel subsidy whilst temporarily painful will facilitate investment in public infrastructure, human capital development, and public sector reforms. These investments are necessary for economic growth and prosperity,” Dafinone reminded.
