IMPI Warns Atiku's Fuel Subsidy Proposal May Deter Investors

The Independent Media and Policy Initiative (IMPI) issued a warning regarding former Vice President Atiku Abubakar's proposal to restore fuel subsidies, stating that it could discourage foreign investment and undermine regulatory confidence in Nigeria. IMPI's Chairman, Omoniyi Akinsiju, expressed that the proposal might signal a return to regulated petrol pricing, countering the Federal Government's three-year effort toward deregulation in the downstream oil sector.

Abubakar's economic recovery plan suggests shifting from consumption subsidies to production subsidies, allowing local refineries to receive crude at discounted prices. However, IMPI criticized this model as potentially creating uncertainty for investors due to politically determined pricing arrangements.

Akinsiju noted that the proposal could undermine the Petroleum Industry Act and create an illusion of price reduction, which might lead to fuel supply issues in remote areas. The discussion on subsidies has intensified as Nigerians deal with the effects of the subsidy removal announced by President Bola Tinubu on May 29, 2023.