New Telegraph

Fuel subsidy withdrawal and a summer of discontent

I am not a soothsayer, but I can say with all certainty like night after day that we are going to be in for a summer of discontent next year, should the Federal Government carry out its plan to deregulate the price of premium motor spirit (PMS), better known as petrol. So far, this government has been very lucky with the reaction of the populace to many of its policies, which often have only exacerbated the living conditions of a majority of Nigerians. In many other climes, things do not get this bad before it triggers a massive reaction from angry citizens, unhappy with their government’s policies. For instance, last week dozens of people took to the streets in Turkey, calling on President Recep Tayyip Erdogan’s government to resign, after the lira crashed by 15 percent against the US dollar.

The Turkish currency has shed a staggering 45 percent of its value this year, becoming the worst performing currency in the world in 2021. Protestors chanted: “AKP to the grave, people to power.” AKP is the Justice and Development Party, Erdogan’s ruling party. Late last month, the island nation of Solomon Islands went up in flames as rising unemployment and poverty, worsened by the border closure during the COVID-19 pandemic, triggered massive unrest, which left three people dead. The unrest was only brought under control when Australia sent Federal Police and Defence Force personnel to the island while Papua New Guinea also sent 34 peacekeepers to help staunch the violence.

In Burkina Faso, also last month, protesters burned tyres and pillaged a government building in the capital Ouagadougou, after police fired tear gas to disperse a march against the state’s failure to stop a wave of violence by Islamist militants. Activist groups called for renewed protests in response to a recent surge of attacks in the West African country, including one by al Qaeda-linked militants that killed 49 military police officers and four civilians two weeks ago.

The assault near the northern town of Inata was the deadliest Burkinabe security forces have suffered since an insurgency broke out in 2015 and has fuelled anger against the government and the French military forces that support it. Since then, there have been scattered protests against President Roch Kabore’s government. Demonstrators in the city of Kaya also prevented the passage of a French military convoy on its way to neighbouring Niger for nearly a week. All these issues are quite rife in Nigeria, and yet to a large extent, the government has been spared the massive and often violent protests as mentioned previously.

For instance, the Central Bank of Nigeria (CBN), due to pressure on the naira, devalued the nation’s currency which it met at N155/$ in 2014 to N411/$ in 2021, while at the parallel market, it moved up to roughly N550 from about N198, despite its harsh effect on the local economy courtesy of a rise in inflation. Of this move by the CBN a Professor of Economics, Femi Saibu, had this to say: “Devaluation cannot solve our current problem because we are not producing. No matter how expensive commodities are in the foreign countries, we still will import to satisfy local consumption. So, devaluation has not been able to induce lesser imports or induce greater exports either.

“It is in our national interest to ensure we do not do anything that will aggravate the exchange rate situation. The last three devaluations only succeeded in shooting up local prices (causing inflation) which is more than the exchange rate increase.” A bag of rice which sold for N8,000 to N10,000 six years ago is now N30, 000, a bag of beans is almost N100,000, three times the minimum wage of a Nigerian worker, a packet of spaghetti is N350 from N200 a few months ago. In fact there is hardly any family in Nigeria not battling with the rising cost of living. Or is it insecurity? Six years ago, the scourge was mainly limited to the North East, but in the last few years, there is no place in the country that is immune to the dastardly antics of bandits and other non-state actors. And yet unlike our Sahel neighbours, Burkina Faso, not even last November’s brutal murder of 78 farmers in Zabarmari, in Jere Local Government of Borno State or the frequent mass abductions of school children has prompted a serious protest from Nigerians for the government to fulfil its constitutional mandate of protecting the lives and property of her citizens.

A government agency, the National Bureau of Statistics (NBS) puts the current rate of unemployment at a staggering 33.3%! And yet, we have not done a Solomon Islands in the so-called ‘Giant of Africa’. Since coming into office of this administration, Nigerians have had to pay more for virtually everything and yet, there has not been a corresponding improvement in power and other services Unfortunately, while the government wants the people to pay the “correct” prices for electricity and fuel, they are yet to “correctly” spend the monies saved on the removal of the subsidies on improved services for the people – hospitals are still nothing to write home about, roads are still in deplorable shape, power is still epileptic and the list is endless. Rather than those in power to weigh in by belt tightening of their own, they are still busy “enjoying” the perks of their various offices.

Thus, despite the hue and cry against the folly of buying vehicles for themselves, members of the National Assembly splashed more than N5.5 billion of taxpayers’ money on new vehicles a couple of years ago, while the State House, Abuja is also planning to spend N1.6 billion on new cars next year. Since coming to power six years ago, the president’s office has spent N5 billion on vehicles – enough to build 500 health centres at N10 million each. It has spent billions more on food, uniforms, travels, maintaining a huge presidential air fleet and more.

The expenditures are examples of how Nigeria’s federal and state governments annually channel scarce public resources into projects that sustain their flashy lifestyles while critical programmes that should benefit citizens are perpetually underfunded. And yet, it is at the behest of the same profligate state governors that the Federal Government has agreed that Nigerians should be ready to pay as much as N340/ litre for fuel from next July. Already civil society groups, labour unions, including both the Nigerian Labour Congress (NLC), the Trade Union Congress (TUC), religious and students’ union bodies have all warned that this is one increase they will not allow. Thus, unless something drastic happens before July 2022; one can safely predict that we will be in for a summer of discontent next year, with Nigerians towing the line of Burkina Faso, the Solomon Islands and Turkey!

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