By Abiola Olawale
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun has made a huge revelation, asserting that the Federal Government has been able to save $20 billion by removing petrol subsidies and adopting market-based foreign exchange pricing.
The Minister made this disclosure at an event in Abuja marking the first 100 days in office of Esther Walso-Jack, Head of the Civil Service of the Federation.
Edun maintained that the combined financial support on fuel and foreign exchange was imposing a substantial burden on the nation’s economy, accounting for an alarming five per cent of the country’s Gross Domestic Product (GDP).
He said: “When there was a subsidy on PMS and foreign exchange, they collectively cost five per cent of GDP. Assuming GDP was $400 billion on average, five per cent of that is $20 billion — funds that could now go into infrastructure, health, social services, and education.”
Speaking further, the minister elaborated that the funds being saved are now being redirected towards various developmental projects aimed at enhancing community infrastructure and public services.
He continued: “The real change is that no one can wake up and target cheap funding or forex from the Central Bank to enrich themselves without adding value.
“Similarly, profiteering from the inefficient petrol subsidy regime is no longer possible,” he added.
The New Diplomat reports that President Bola Ahmed Tinubu, upon assuming office last year ended subsidies on fuel and foreign exchange.
Tinubu noted that the choice to remove fuel subsidies and dismantle various foreign exchange systems was crucial, as these measures had been taken advantage of by a small group of privileged elites.
He articulated that this decision was not only about economic reform but also about promoting fairness and ensuring that resources were allocated more equitably across society.
