September 08, (THEWILL) – For probably the first time in the history of Nigeria, the people in their various professions, associations, and businesses allied to fault a flawed government policy.
A few hours after the Nigerian National Petroleum Company Limited Retail Management on Tuesday approved an upward review of the pump price of petrol from N617/litre to N897/litre, effective September 3, 2024, the organised private sector, comprising the Manufactures Association of Nigeria, MAN, the National Association of Chambers of Commerce Industry, Mines and Agriculture, NACCIMA, the Nigeria Employers’ Consultative Forum, NECA, alongside the Nigerian Bar Association, NBA, the Nigeria Medical Association, NMA, Afenifere, Yoruba Elders Forum, the Coalition of Northern Groups and Federal lawmakers, not to mention the Nigeria Labour Congress, NLC and the Trade Union Congress, TUC, rose with one voice in condemnation of the price increase.
The Chairman of the House of Representatives Committee on Petroleum Resources (Upstream), Alhassan Doguwa, also urged the executive to reverse the increase saying, “As a committee, we urge the Nigerian Government and of course, the NNPCL to consider the plight of Nigerians and suspend this recent increase in pump price of petrol.
“Nigerians are currently going through a lot today and adding to this burden is not in our collective best interest. Let us revert to the old pump price as soon as possible. And probably intensify engagements with major stakeholders to address the problem.”
TINUBU REACTS
But 10,925 kilometres away in Beijing, China where he attended the 2024 Summit of the Forum on China-Africa Cooperation, FOCAC, President Bola Tinubu on Friday reacted to the lamentations back home. The president is now in London, England on a private visit.
Addressing members of Nigerians in the Diaspora Organisation in China (NIDO China) and the Nigerian community at the China World Hotel, Tinubu said, among other things, that “Nigeria is going through reforms, and we are taking very bold and unprecedented decisions. For example, you might have heard about fuel prices from home in the last few days.
“But can we help it? Can we develop good roads like you have here? You see electricity being constant in quantity and quality. You see water supply, constant and running, and you see their good schools. And we say we want to hand over a banner without stain to our children?
“What is the critical part to get us there if we cannot take hard decisions to pave the way for a country that is blessed and so talented?
“So many of you are so talented, speaking very fluent Mandarin. It is what you contribute and tell them at home that will reflect in the attitude of our people. The more you want everything free, it will become more expensive and long-delayed to achieve meaningful development.”
Senior Economist and partner, SPM Professionals, Dr Paul Alaje, faulted the president’s optimism at the weekend. Speaking with THEWILL on the new petrol price increase, he said the price will keep increasing because the Federal Government is yet to tidy up its micro-economic policies.
Alaje said, “When the NNPCL talked about market forces, there is no way we will allow our economy to grow if we are not producing and exporting enough. Our real challenge as a country is because we have floated our currency. Imagine what the exchange rate was today (Friday), as it gets bad, the prices of anything imported into the country will get worse. NNPC had said they were owning so much and they wanted to ease the burden, which is exactly what they have done with the price increase and allow the people to carry the burden.”
The Spokesperson for the pan-Yoruba social and political organisation, Afenifere, Jare Ajayi said apart from its wide-range social and economic impact on the citizenry already going through hardship, the policy would negatively impact progress achieved through some government policies.
“Failure by the NNPC Ltd to reverse the latest increment in fuel price will rub off negatively on some policies of President Bola Tinubu’s government to ease things for the citizens, especially such policies as the Students Loan Scheme and Consumer Credit Scheme that are just taking off, “ he said, adding that “It is crucial, therefore, that the government orders NNPCL to reverse the price hike forthwith, as it is already causing untold hardship for the people,” he said.
REACTIONS FROM THE STATES
With the countdown to the September 15 deadline, which the NNPCL chose as the day for the supply of petrol from the $20 billion Dangote Petroleum Refinery, queues were yet to ease at many petrol filling stations across the country, which are, in some cases, deserted because of the inadequacy of supplies despite assurance by the Executive Vice President of Downstream, NNPC, Adedapo Segun, that the current fuel scarcity was expected to “subside in a few days as more stations recalibrate and begin selling PMS.”
Even so, with the product selling for between N860 per litre and N880 per litre at NNPC Mega Stations in the nation’s capital, Abuja and its commercial hub, Lagos, many filling stations were under lock and key.
BAYELSA, KWARA, LAGOS, PLATEAU, BENUE, SOKOTO, IMO
For example, the 84.3-kilometre Lagos Abeokuta Expressway up to Oshodi in Lagos, had few filling stations among which were selling fuel, including an NNPC Mega station. On the 7.6 kilometre Berger-Ikeja route, vehicular traffic was light. Capitalising on the scarcity, black marketers began selling fuel at between N1,300 per litre to N1,500 per litre.
Bus fares have gone up by 50 per cent on some routes and by 100 per cent in others. From Mowe in Ogun State on the Ibadan-Lagos Expressway to Berger in Ikeja, commuters now pay N1,000 as against N500 a few days ago. Iyana Ipaja in Lagos to Oshodi in Lagos has increased from N400 to N700.
“I used to spend N25,000 monthly on transport from my workplace in Agege to Motorways in Ojodu. With the fuel increase, I will start paying between N46,000 to N50,00, which is half of my monthly wage.” Andrew Beifo, a freshly discharged corps member, who recently got a job in an asset management company, told THEWILL on Friday. “It is unbelievable how things can suddenly change in this country. It is very frustrating.”
A school teacher who also expressed her dismay to this newspaper narrated how she was embarrassed in a fruit market at Ile-Ipo on the Lagos- Abeokuta Expressway last Wednesday, the same day that NNPCL announced the new petrol price regime. Unaware that the cost of commodities had gone up since she last visited that section of the market a week earlier, she was shocked to find that prices had increased three days prior to the September 3 date for new petrol prices and when she insisted that the traders could have been considerate, she was told that what NNPCL did was to formalise the price regime that had been operating in the previous week.
“You can imagine how stupid I looked. NNPC was testing Nigerians with that prevailing price all along during the so-called scarcity only to formalise it on September 3 because Nigerians accepted it. This is wickedness of the highest order. Very insensitive,” she said
The price hike has also added to the challenges facing the people of Bayelsa State who already had been discouraged by the turn of events. Although oil was first discovered in commercial quantities in the state (Oloibiri) in 1956 and it is home to the fourth highest concentration of oil wells in the country, the story of scarcity of petroleum products in the state is not different from that of their compatriots in other states.
According to Azu Ishiekwene, Senior Vice Chairman and Editor-In-Chief of Leadership Newspaper, “It is disheartening that residents in this state, home of Oloibiri in Nigeria where oil was discovered and home to the 4th highest concentration of oil wells must go through this to buy petrol. My driver said that drivers who were unable to buy petrol the same day would leave their vehicles at the station and return the next day. They are used to it.”
Bayelsans have their own pain to tell about the hike in petrol, as it has affected the micro and macro economies of the state, but the people are resilient and confronting the situation. For instance, transportation fares have increased astronomically. Routes like Ekeki to Akenpai, Mopol Base which attracted N200 until recently have gone up to N500 hundred during the day and N1,500 at night.
The soaring prices of foodstuff following the recent fuel price increase, especially at the Swali Ultra Main Market and other community markets which are a convergent point for many of the products, have made life hard for the people.
Olachi Okere, a student at Imo state University in an interview, said he now spends N1800, every day for transportation to school. “Federal government should try its best to fix the fuel crisis we are experiencing these days. We cannot continue like this”. A commercial bus driver, Mr. Charles Nwachukwu, said he had to raise the fare by 80 per cent to be able to break even.
In Sokoto State, residents have continued to criticize the Federal Government over what they described as the incessant increase in prices of petrol. In an interview with our Correspondent in Sokoto on Friday, Malami Abubakar, a civil servant said the fuel pump price has negatively affected his monthly expenditures in recent times.
According to Abubakar, his daily expenditures have continued to be overweight. “With the family of seven, he said he spent no fewer than N100, 000 for foodstuff only to care for my household in a single month.” Salisu Garba, a commercial motorcyclist said with his two wives and six children, he now struggled to feed them with his daily income.
“As an Okada (Commercial Motorcyclist), I am only sure of making a profit income within the range of N2, 000 to N3, 000 from my cycling business. I can’t even buy a plate of rice now. Right now, I’m only struggling to cater for my family’s daily needs,” he explains.
Michael Afolabi, an artisan said he is planning to go into race farming if secure small capital. The 40yrs-old father of four who repairs freezer and other air conditioner appliances said the current economic reality has affected his works as there is low patronage of clients daily.
“People are not coming to repair their appliances unlike before. Things have really changed due to the current economic hardships. For me, I will be venturing into farming if that will be a guarantee to put food on the table for my family.” Meanwhile, amidst prevailing economic challenges, the State Governor, Ahmed Aliyu in April this year announced the N5 billion worth of grains to residents across the State.
In Benue State, citizens have adopted cost-cutting measures to stay afloat.
THEWILL found that civil servants, families and other professionals have resorted to trekking long distances to cut down on expenses. A Makurdi-based publisher of a tabloid, Comrade Akpen, said he decided to lay off some workers now to save money to sustain production.
A civil servant, who gave his name as Jasper, told our correspondent that he has parked his car for the past two months to cope with the current reality of life induced by the fuel crisis in the country.
The General Manager of Abudy Water Factory located in Makurdi, Dr Joe Ankpan, decried the high cost of running his power generator to ensure production; he must produce two times a week to beat down costs. An Economist, Dr Emmanuel Iyah, who spoke on the high cost of living in the country and Benue State in particular, noted that the way out of the current dilemma is for both the government and people to look inward for survival.
In Plateau State, the controversial increase in the pump price of fuel has continued to dominate discussions in socio-economic circles, with different persons adopting various approaches to survive a situation that one of them has described as a “suffocating economic squeeze”.
Barrister Osim is a legal practitioner who is not happy with the development which he said has only “worsened business prospects across board”. He said choosing public transport may reduce personal costs but will not do away with other inconveniences and the burden it will pass to clients.
John Farnola and Pam Musa are journalists who are routinely on the move. In view of the latest hike in the price of fuel, they say that every movement and every destination must have immediate economic value if they must drive their vehicles there.
They said journalists now would have to pool their resources together and move in one vehicle, just as Farnola hinted at bringing his children to a school close to his place of work. “The old days are back”, as Pam
Musa said, “Don’t rule out a return to parking the car and trekking for business”.
A medium scale employer of labour decried the increased cost of operation because of the macro distortion and pointed out that the inevitable options include retrenchment, shift arrangements, streamlining of operatwions, and the devil’s alternative otherwise known as staff casualisation.
Residents of Plateau are already calling on Governor Mutfwang to increase the number of Tin City Metro Transport buses to respond to increased passenger pressure following the residents’ resolve to park their cars in the face of the upsurge in price of petrol.
Many commercial bus operators in Ilorin, the Kwara State capital, took to the streets to protest the new hike in petrol pump price and expressed their displeasure with the decision of the Federal Government. The protests which commenced on Thursday morning significantly disrupted the movement of commercial vehicles across the city and forced commuters to trek to their various destinations.
The protest was spearheaded by some operators of commercial tricycles and commercial motorcycle riders who blocked several major roads in the city. The roadblocks occurred at Taiwo Isale, Coca-Cola Road Junction, Maraba, Gambari Road and Offa Garage, bringing traffic to a standstill for several hours.
The presence of security agents helped to prevent the protest from escalating into full-scale riot and ensured that it remained largely peaceful, despite the significant disruptions to daily activities.
For the real sector of the economy, MAN D-G, Ajayi –Kadir, who submitted that though price increase was inevitable, given that Nigeria still depends on imported fuel amid increase in prices in the global spot market, said, “The increase in costs could force some to scale down operations or even shut down if they are unable to pass on the additional costs to consumers. Businesses may need to adjust their pricing strategies, which could lead to reduced profit margins if the consumer demand weakens. Small and medium sized enterprises, which often operate on thin margins could be particularly hit.
WAY FORWARD
Although many Nigerians appear to detest the word ‘subsidy’ because of its association with hardship for the past 14 months, Dr Alaje stated that since many countries give some form of subsidy to its people, like the United States of America, which subsidises its farmers, Nigeria should consider some form of subsidy for its citizens. “For me, this should be that our currency is fixed, pegged at N1,000 to the dollar. When we talk of microeconomics variables we are talking about stability, which is the goal. Leaving our currency to run up and down with no predictability can only harm our economy in the long run. Countries like Germany after World War II, Japan, Russia, Venezuela and Zimbabwe, which had floated their currency at a point in their history, had had to peg their currencies to the dollar before their unstable economies stabilised. Then excessive spending must stop in order not to keep burrowing in another currency. Can you imagine that Nigeria is even raising local bonds, using foreign currency? This is as good as burrowing. I conducted research in 2022 and found out that foreign loans have over 80 per cent negative impact on the economy.”
Also, the President of the National Bar Association, Mazi Afam Osigwe, urged the Federal Government to withdraw the increase in the pump price of petrol and engage relevant stakeholders to discuss the way forward. “We urge the government to prioritize the welfare of its citizens, particularly the most vulnerable, and to pursue policies that alleviate rather than exacerbate the hardships faced by the Nigerian people.”
Secretary-General of the Yoruba Council of Elders, Chief Oladipo Oyewole, YCE, stressed that Tinubu needs to go back to the drawing board and fashion out measures that will bring immediate comfort to the people. Professor Mustapha Na’Makka, a professor of Business management and Entrepreneurship from Usmanu Danfodiyo University, Sokoto in a chat with THEWILL urged Nigerians to engage in enterprise-oriented business to complement their earnings.
“The present economic reality in Nigeria, and across the globe needs for everyone to engage in one form of income generating skill or business. People must have a complimentary business or skill that could earn them extra income for sustainability.” Na’Makka advised.
Amos Esele is the Acting Editor of THEWILL Newspaper. He has over two decades of experience on the job.
