The Nigeria Employers’ Consultative Association (NECA) has again expressed concerns at the corruption-ridden fuel subsidy regime and the increasing debt profile of the country.
This concern is coming as the usual queues resurfaced in filling stations across the country, with the usual attendant suffering.
The Director General of the association, Mr. Timothy Olawale, who stated this yesterday, when he addressed members of NECA in Abeokuta, Ogun State, said “like a sore that has refused to heal, the recurrent issue of fuel scarcity has reared up its ugly head again.
“We are where we are today because, despite past sound counsel, government has not been faithful to the deregulation of the petrol market of the downstream sector of the oil and gas.
“Let us ponder and ask ourselves where the non-deregulation of the petroleum sector has led our economy: continued dependence on offshore sources for petroleum products, supply perennial shortage of petroleum products, loss of productive man-hours as a result of endless hours spent at filling stations, massive and unimaginable corruptions in the management of the subsidy dispensation.”
All these, he said, are not sustainable if government can put its act together and muster the necessary political will to do things that are right for the country.
Giving insight into the need for urgent deregulation of the downstream oil sector, the NECA boss noted that “over the last decade, the country has spent over N9 trillion on fuel subsidy, about N15.5 trillion on capital expenditure, N2.1 trillion on health and about N3.9 trillion on education.
“This is a misplacement of priority and shows that critical developmental items such as education, health and infrastructure have suffered due to the expenditure on fuel subsidy.”
He noted that “by and large, the fuel subsidy regime has succeeded in creating phony and emergency billionaires at the expense of millions of pauperised Nigerians.”
Olawale also expressed concern at the growing debt stock of the country with huge percentage of the budget, over the last decade going to debt servicing.
He pointed out that “borrowing could have been permissive, given the state of the economy in 2015 but not to the clearly humongous level it has turned out to be.”
According to NECA boss, incurring debt for developmental purposes is not in question, but when over N24.39 trillion debt stocks is taking over 20 per cent of annual national budget to debt servicing, it should be enough source of worry.
He noted that although the argument of debt-to- GDP ratio is tenable, the International Monetary Fund ( IMF) has warned that Nigeria’s Debt-to-GDP ratio, though good, is risky and cannot be guaranteed going forward.
He advised that “government should do well to manage the rising debt profile, both at the states and federal levels as this trend portends a gloomy future for the nation.”
The NECA helmsman said “increasing debt profile and the corruption-ridden fuel subsidy regime are twin-evils that has clogged the wheel of the nation’s march towards development in the last decade.
“Government should do the needful by immediately putting in place a process and enlightenment machinery that will lead to the deregulation of the downstream oil sector and a deliberate disengagement from the debt burden,” he explained.