Vice President Kashim Shettima has revealed that $10 billion was spent by the immediate past administration of Muhammadu Buhari subsidizing fuel in 2022.

He said the current administration was bent on exiting fuel subsidy because of its negative implications for the country as a whole.

Shettima reiterated his principal’s position on Tuesday, while reporting for duties on his first day in office at the Presidential Villa Abuja.

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He said the current administration anticipated that there will be fierce opposition to its decision to remove fuel subsidy.

His words, “The President has already made pronouncements yesterday on the issue of the fuel subsidy. The truth of the matter is that, it is either we get rid of the subsidy or the fuel subsidy gets rid of the Nigerian nation.

“In 2022, we spent $10 billion subsidizing the ostentatious lifestyle of the upper class of society because you and I benefit 90% from the oil subsidy. The poor 40% of Nigerians benefit very little and we know the consequences of unveiling a masquerade.

“We will get fierce opposition from those benefiting from the oil subsidy scam, but where there is a will, there is a way. Be rest assured that our president is a man of strong will and conviction.

“In the fullness of time, you will appreciate his noble intentions for the nation. The issue of fuel subsidy will be frontally addressed. The earlier we do so, the better.’’

Economists and investment analysts have hailed President Bola Ahmed Tinubu for discontinuation of fuel subsidy and planned unification of the exchange rates.

Reacting to the plan, Uche Uwaleke, Professor of Capital Market and President, Capital Market Academics of Nigeria, expressed support for the removal of fuel subsidy and unification of the exchange rate by Tinubu, saying that fuel subsidy comes at a huge cost to the economy.

He maintained that fuel subsidies have proven to be unsustainable over time“I support the removal of the fuel subsidy due to its huge cost on the economy. Fuel subsidies have proven to be unsustainable.

“I equally support the unification of exchange rates because doing so will discourage round tripping, bring more transparency to the foreign exchange (forex) market which supports foreign investments.

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“However, in order to minimize negative impact on the livelihoods, issues of fuel subsidy and exchange rates unification which he mentioned in the speech should be handled with care. Stakeholder engagement is required,” he said.

He, therefore, called for an immediate constitution of an “Economic policies’ coordinating committee” made up of Economic and Finance experts to craft policies that would jump start the economy from the doldrum Buhari’s administration left it.

Also commending the plans, Mr. David Adonri, Vice Chairman, Highcap Securities, said the plan if carried out, would repair the damages caused to the economy by the twin problem.

He, however, queried Tinubu’s failure to address the rising debt burden, saying that a continuation of the borrowing spree would be detrimental to real economic growth.

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He said: “President Bola Ahmed Tinubu’s inaugural speech addressed three critical pressure points on the Nigerian economy. These are insecurity that has crippled the rural economy, discontinuation of fuel subsidy and unification of the exchange rate.

“His remedial plans against these challenges can repair their damages to the economy. However, he failed to address the crippling debt burden which has fueled inflation and caused a rise in interest rate.

“His GDP growth target of minimum of 6% per annum could be a mirage if he concentrates on secondary infrastructure development at the expense of primary infrastructure like was done under President Muhammadu Buhari.

“If he continues with President Buhari’s excessive borrowing spree, increase in GDP will just remain an inflationary growth or motion without movement,” he said.

The governor of the Central Bank of Nigeria, CBN, Godwin Emefiele, has revealed that the CBN had given out about N8 trillion in interventions to the private sector in the last five years.

Emefiele made this revelation while speaking at the end of the 291st Monetary Policy Committee, MPC, meeting in Abuja on Wednesday.

He said, “In the last four to five years, we have done about N8 trillion in interventions to the private sector of the economy. The loans have been granted for 10 years, with a two-year moratorium and at single digit”.

The CBN boss disclosed, however, that going forward, the apex bank would reduce its quasi-fiscal activities.

Meanwhile, as the Dangote Refinery set to deliver its first products in July, Emefiele said that the refinery would be persuaded to sell foreign exchange earnings to banks at a good rate.

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Emefiele said his team would engage the promoter of the refinery, Alhaji Aliko Dangote, to ensure that Nigerians benefitted from the venture, adding that the CBN, the Federal Government and, indeed, the country helped him set up the refinery.

The CBN boss expressed optimism that the refinery would ease the foreign exchange scarcity in the country, noting that with local refining, about 20 per cent cost of the total cost of importing petroleum products could be saved, thereby reducing prices in the long run. He, however, said it was time to exit the fuel subsidy regime.

His words, “By the time the Dangote Refinery comes on stream, the price at which it (fuel) will be dispensed will be lower than what it is when we spend dollars to import because there will be no freight cost, no storage and all other logistics expenses.

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“So we will be lucky to be having about 20 per cent savings from refining locally, rather than importing.

“But the important thing is that we have reached a point, whether we like it or not when we must exit subsidy.

“Dangote Refinery coming at this time gives us the confidence that even if we exit subsidy, the products will be available. And eventually, the interplay of market forces will also moderate the prices to a level that will help the country.

“So we are expecting that, no doubt, by the time he produces for domestic consumption, the excess will be exported by the numbers that he talked about, which we agree with.

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‘’We should be able to save, conservatively, close to about $5 billion to $10 billion in foreign exchange that will come into the country.

“Whether it comes to our reserves or not is not the point, it is the fact that the dollar is available and it will be sold in the domestic market so that customers of banks who need to import do not necessarily resort to CBN for dollars.

“They can go to their banks and Dangote will sell dollars to their banks and we are going to ensure that it is done at a good market rate.

“What I would have loved to say on Monday (at the Dangote Refinery Commissioning) which I didn’t say was that the CBN, the government and the country have helped Dangote to set up that refinery.

“He is a Nigerian; Nigerians must benefit from that venture and we are going to engage him and talk to him and I am sure that being the richest man in Africa, he is going to throw a few crumbs so that the price will be lowered.”