Eye Ball To Eye Ball
It was a day designed for the stakeholders to rob minds on the proposed removal of fuel subsidy by the federal government. The actors involved came out in their numbers to speak in favour or against the proposal. But in the end, it was agreed that the ‘economic buccaneers’ who feast on the nation’s treasury must be exposed. The event which was the second Town Hall Meeting on the removal of fuel subsidy to be organised by the Newspaper Proprietors of Nigeria, NPAN in Lagos.
It was an opportunity to tell one another the truth. Minister of Finance, Ngozi Okonjo-Iweala had lit the venue with her introductory speech. She stirred the hornet nest by admitting that there were some “unpleasant dealing going on in the management of the oil sector and that continuing with subsidy payment would be unwise. Okonjo-Iweala might had attracted the anger of the stakeholders by not mentioning even a name. She said fuel subsidy removal was long overdue to allow for better regulation of the oil sector and for transparency. According to her, government can no longer sustain the subsidy which gulped about N1.3 trillion alone and amounted to over 30 percent of total government expenditure in 2011.
She, however, urged Nigerians to give government a chance for things to work out. “We need to use the resources to better the lots of the people. We need good roads, health services. We are ready to work with NLC and TUC. We are tired of talking; we want to put in action,” the minister said.
Dezieani Allison-Madueke, the Petroleum Resources Minister, is among the government team. She urged Nigerians to bear the temporary pains. She claimed that if Nigerians are not prepared to suffer now, it will be stagnant. “Unless we have the courage to bear the temporary pains, there will be no development. If we are not prepared to suffer now, we will stay where we are and it will not be any better.” The Petroleum boss claimed that government is working to make the country’s refineries function at 90 percent capacity utilisation in 24 months time in order to lessen the impact of subsidy removal.
Central Bank of Nigeria, CBN governor, Sanusi Lamido Sanusi declared that removing subsidy does not address incompetence or corruption. He advised that if government fails to use the proceeds from the subsidy, it should be voted out in the next elections. He however revealed that government still maintained subsidy in the importation of agricultural equipment and power sector. “There is subsidy for agricultural equipment and anything imported for power.” Lamido claimed that the way out of the present problem is reform and for the private sector to come in and build refineries. He said government cannot build because it will still go the way of others.
Minister of Information, Labaran Maku said subsidy will lead to value addition to various sectors of the economy, which will be opened up. He emphasised that government would utilise its share of the resources from the subsidy to implement a combination of programmes that would stimulate the economy and alleviate poverty.
“The federal government is desirous of discontinuing subsidies on prices of petroleum product because this poses a huge financial burden on the government. It disproportionally benefits the wealthy, whereas the poor masses who are supposed to benefit from the subsidy hardly get to enjoy it.
“High price disparity has encouraged smuggling of petroleum products across the borders to neighbouring countries, where prices are much higher. Nigeria therefore ends up subsidising consumption of petroleum products in neighbouring countries.” Maku noted that subsidy would be removed, but not without adequate plans put in place to aid the various sectors of the economy, particularly the poor and vulnerable segments.
Vice-president of the Nigeria Labour Congress, NLC, Isa Aremu said though labour was not ideologically against the plan, it has strong fears that the aftermath of the removal of subsidy would be a “win win” situation for the federal government". Aremu said Nigerians will resist any attempt to pay higher prices for imported petroleum products. He advised that government should move from subsidising import to subsidising local production of petroleum.
Constitutional lawyer and activist, Femi Falana urged the government to listen to “alternative suggestions” and allow for more time to engage Nigerians before going ahead with the plan to remove the subsidy. He claimed that the fuel cabal had a field day because the government had refused to implement all the necessary laws that would have prevented them from ripping off Nigeria. “Don’t impose further punishment on Nigerians. They cannot afford to pay for the corruption and inefficiency of government,” Falana advised.
Edo State governor, Adams Oshiomhole’s bluntness which was brusqueness on corruption was applauded. Though he said he was not against subsidy removal in principle, but against realistic measures not being taken ahead to serve as a cushion for the effect on Nigerians. Former chairman of the Nigerian Bar Association, NBA, Olisa Agbakoba (SAN) operated on the same page with Gov. Oshiomhole. Agbakoba said though there is nothing “conceptually wrong” with the promise of competition and free market that fuel subsidy removal will bring, government has to sacrifice more before going ahead with the policy. “We are not giving subsidy removal a bad name; if you want to put a burden on us, show us the one you (government) are carrying,” Agbakoba demanded.
Farooq A. Kperogi, a writer, argued that when compared the fuel prices among oil-producing nations of the world, it showed that Nigerians pay the highest price for petrol even though they receive the lowest minimum wage among their peers.
The petrol used for car in America burns a lot slower than the one in Nigeria, meaning that, at the current rate, Nigerians with a miserable minimum wage of N7,000 per month or about $45 per month as against America’s over N180,000 minimum wage per month, actually pay more than or about equal to Americans for petrol.
A Nigerian online citizen investigator who goes by the handle “Viscount” revealed recently that Nigerians not only pay the highest price for fuel in OPEC, they also consume the worst imaginable grade of petrol among oil, producing countries.
Investigation shows that Nigeria has one of the world’s best and finest qualities of crude oil but the fuel consumed in Nigeria is not derived from the crude oil but cabals import toxic, low-quality oil that is not fit for consumption in Europe or North America, or in any society that cares for the welfare of its citizens.
At the center of the tragic importation of toxic petroleum products into Nigeria and other West African nations is an Amsterdam-based multinational company called Trafigura. Investigation carried out by some group of journalists from the UK, Norway, and the Netherlands in 2010 reports on Trafigura’s barbarous dumping of toxic petroleum waste on Cote d’Ivoire; the waste killed scores of people and sickened thousands more.
In July 2010, an Amsterdam court found the company guilty and fined it 1 million euros. (The caustic petroleum residues were dumped on Cote d’Ivoire on July 2, 2006).
On June 24 this year, Afrol News, an Africa-centred news agency, reported that it had been “given documentation” that shows that the same Trafigura that was fined for dumping deleterious waste on Ivoirians had offloaded “dangerous and poor gasoline (i.e., petrol)” in the “Nigerian port of Lagos.” This toxic petrol, which Nigerians have been consuming for years and which governments “subsidise,” according to the Afrol News report, “is highly unstable, not enduring sunlight exposure, and will cause damage to vehicles. It will also cause environmental damages due to high sulphur values and can therefore cause human health damages. The product is strictly illegal in Europe and the US, but in some cases may be within legal quality and environment standards in some West African countries.”
Petroleum experts are worried that despite forcing ordinary Nigerians to use their hard-earned money to buy inordinately overpriced and demonstrably harmful petroleum products, government still wants to increase fuel prices again next year. They are disturbed that government has no plans to repair the refineries that have comatose, so that crude oil can be refined domestically and bring down the cost of petrol. No wonder Trade Union Congress, TUC, Comrade Peter Esele at the Town Hall Meeting last week accused government of giving support to cabal hence their continuous existence.
Esele claimed that because the cabals give back to people in government in forms of support to their political parties and ambitions, that is why they remained untouchable. ““Cabal cannot survive without people in government because, they support their ambitions and political parties.”
It was also alleged that in January 2011, the Jonathan administration signed a multi-billion-dollar annual contract with the same Trafigura of toxic fuel dumping infamy. And there was no due process in the award of the contract.
According to Business Day of January 4, 2011, “Under the agreement with the Nigerian government, Trafigura is expected to pick up Nigerian crude oil and in return, supply her with refined products; but it is unclear why the firm, which has supplied refined products to Nigeria in the last 12 years, was favoured for the deal.
“Trafigura agreed to an annual contract with the Nigerian National Petroleum Corporation, NNPC on the basis of taking 60,000 barrels of crude oil per day in exchange for refined products such as gasoline and gas oil of equivalent value estimated at around $3 billion a year.”
An insider who happens to be an oil industry expert, who spoke on anonymity to Business Day, said just “$1 billion of the amount would have put the four refineries in proper shape.”
The sincerity of President Goodluck Jonathan will be put to test if the proposed fuel subsidy finally scales through.
Associate Professor of Mathematics with the American University of Nigeria and the coordinator of the Middle Belt Federation under the Middle Belt Coalition agenda, Leonard Karshima Shilgba claimed that in 2009, late President Yar’Adua’s special adviser on media, Segun Adeniyi stated that “the essence of the whole dialogue is that we deregulate the market and ensure that we are not held to ransom by cabals."
He alleged that more than three years after the statement, government did nothing about the “cabals.”
Shilgba said since Adeniyi or President Yar’Adua’s government made the revelations, they had failed to follow up. “There is dishonesty (or corruption) in the pricing of petroleum products by the PPPRA."
He believes that a group of people (whom Mr. Adeniyi called “cabals”) is holding Nigerians to ransom and government wants to hide its incompetence at enforcement of the rule of law through total removal of fuel subsidy, rather than mop up the amount it is wrongly spending in the name of fuel subsidy. The Nigerian people must not suffer for failure of government.