June 4, 2023

IPMAN backs subsidy removal, seeks end to FG’s import monopoly

IPMAN urges Nigerians to disregard strike threat by South-East faction

Retention will cripple economy, expert

By Obas Esiedesa

THE Independent Petroleum Marketers Association of Nigeria, IPMAN, has backed the removal of petrol subsidy by President Bola Tinubu but has asked the government to end its import monopoly through the national oil company.

IPMAN in a statement by its National President, Debo Ahmed and Secretary General, Chief John Kekeocha, asked President Tinubu to ensure that other downstream sector players have the required environment to compete fairly with NNPC Limited.  

The marketers noted that “the primary essence of removing subsidy is to free the market and make it competitive. This is by allowing other interested parties into the petroleum supply network. This is either by their engaging in importation or local refining. It’s the duty of the government to ensure that all bottlenecks and frustrations in this regard are removed so that adequate productions and supplies will eventually precipitate reasonable reductions in the high price that is being witnessed at this initial take off.

“While many Nigerians welcome this policy with a pinch of salt, it is our prayers and believe that the constraining sacrifices of the people in swallowing this bitter pill will be compensated with obvious and empirical proves of how the dividends of the subsidy removal has positively impacted on the lives of the people vis-a-vis the economy. The other indices of good governance in the areas of infrastructural development, in the health sector, education and basic social amenities will be attended to”, IPMAN added.

Subsidy retention will be economic suicide – Prof Iledare

In a note at the weekend, Energy Economist, Prof. Wumi Iledare held that retaining subsidy as being advocated by labour unions would be catastrophic for the country, arguing that the government should rather introduce measures to alleviate the impact of the removal.

According to him, “A strike by NLC (Nigeria Labour Congress) would be I’ll-advised and in futility as it will not be issue based. Even asking to revert to the status quo when everything including transport and food has taken the new price regime will be detrimental to all end users. The train has long left the station. NLC has an opportunity now to sit, negotiate and jointly draw up and monitor programmes with the government that will benefit the majority in the short to medium term. 

“Government cannot and should not be involved in refinery construction. It has never worked in the past and will never work in the future. The Government and its agencies should allow/encourage marginal and big players to get into the refinery industry via removing stumbling blocks and creating a one stop shop for documentation and licensing.

“Provide support via taking equity stakes like was done in Dangote. Use part of the $800m World Bank loan to do this if possible and seek to buffer this up.

“Commit to providing crude inputs, at commercial rates, as it makes more sense to add value and refine locally than sell raw crude to foreign parties. The value added refined products can still be sold to foreign parties and FOREX generated for the country. 

“This way, in less than a year or so, we can flood the local and neigbouring African markets with refined products and curb part of the nation’s endemic corruption challenge”, he added.