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Fri, Mar

Fuel Subsidy, Debt Servicing Pushing Nigeria Into Bankruptcy – Emir Sanusi

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The Emir of Kano, Mallam Muhammad Sanusi II says the country will soon slip into bankruptcy following huge government spending on fuel and electricity subsidies, as well as debt servicing.

 

The former Governor of Central Bank of Nigeria raised the alarm while delivering his address at the ongoing third National Treasury Workshop, organised by the office of the Accountant-General of the Federation in Kano. He urged the President to urgently withdraw all forms of subsidies for petroleum products and electricity.

 

“In 2011, when I was CBN governor, Nigeria made $16bn from petroleum sales, and we spent $8bn importing petroleum and spent another $8.2bn subsidising the product…and I asked, ‘Is this sustainable?

 

“The country is bankrupt and we are heading to bankruptcy. What happens is that the Federal Government do pay petroleum subsidy, pays electricity tariff subsidy, and if there is a rise in interest rates, the Federal Government pays. What is more life-threatening than the subsidy that we have to sacrifice education, health sector and infrastructure for us to have cheap petroleum?

 

“If truly President Buhari is fighting poverty, he should remove the risk on the national financial sector and stop the subsidy regime, which is fraudulent.

 

“Two days ago, I read that the percentage of government revenue going to debt servicing had risen to 70 per cent. These numbers are not lying. They are public numbers. I read them in the newspapers. When you are spending 70 per cent of your revenue on debt services, then you are managing 30 per cent.

 

“And then, you continue subsidising petroleum products and spending N1.5tn per annum on petroleum subsidy! And then we are subsidising electricity tariff. And maybe, you have to borrow from the capital market or the Central Bank of Nigeria to service the shortfall in the electricity tariff. Where is the money to pay salaries? Where is the money for education and other government projects?”

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