October 6, 2015

We won’t rush into removing fuel subsidy —OSINBAJO

Osinbajo resumes in office

By Favour Nnabugwu

Abuja—Nigeria’s Vice President, Prof Yemi Osinbajo, yesterday, said the current administration was not in a rush to removing fuel subsidy.

Prof. Osibanjo in an interview with CNBC Africa, said the federal government would deal with the challenges of the country’s refineries, admitting that the Nigerian National Petroleum Corporation, NNPC, had serious problems that government had to sort out.

Osinbajo resumes in office


He said: “There is a great deal of flexibility in all these but we are not prepared to rush into any particular policy.

“Today oil sells for about $45 a barrel and this means that we are not paying substantial policy anyway, we are at a point where the impact of removing it is not great at the same time we are not in a rush to removing subsidy immediately.

“First what we have tried to do is to deal with the issues of inefficiency around the NNPC which of course is our National oil company because many observers know that we have serious problems around the way the NNPC was being run”

“With the change in the management of the NNPC and all the new policies that are in place, we think that we are the point where we will be able to do better.”

The GMD has actually been looking to make sure that the refineries work efficiently and see how we can partner with oil companies and refinery owners to see how we can refine the product locally.

“We are at a point where we think that if we are able to make our refineries work more efficiently for example the Dangote refinery in Lagos which will do up to 650,000bpd.”

“That is significant because by 2017 it should come up. We are hoping that we can speed that up and help private participant who obviously will help the meet the challenges of the local refineries.”     “We think that if we can deal with the local refineries we can handle the issues of subsidy and for us we are taking as gradual approach to it we can do local refining and make it more efficient.”

“We are also ready to work with private sector participant who are prepared to invest in refining capacities here in Nigeria. We hope that the outcome of that will be that we are no more going to import the product in the next two to three years. We think that is a long-term strategy and we hope it works.”

He said that government was looking at long term solution to power and would either privatise or concession    the transmission while it aims to achieve 5,000 mega watts in the first quarter of 2016 from the current generation level. “We are looking at 5,000 mega watts in the first quarter of next year”, Prof. Osinbajo said.

The Vice-President further said that government did not intend to increase taxes but to efficiently improve tax collection.

On federal government fight against corruption, Osinbajo said: “The fight against corruption is a systemic approach that will be phased out from the country.”

He added that the country’s leaders must be above board in the fight against the menace.

On the Treasury Single Account, TSA, he said Ministries, Departments and Agencies, MDAs, had various accounts that were not known centrally, stating that federal government would be able to know how much the country has at any given time with the TSA.