NNPC’s expenditure of $10b on fuel subsidies in 2022, ruined public finances. – Govt

Africa

NNPC’s expenditure of $10b on fuel subsidies in 2022, ruined public finances. – Govt

January 21, 2023January 21, 2023

According to the most recent data from the state-owned company, which was reported on Friday, the Nigeria National Petroleum Company, or NNPC, spent $4.39 trillion naira ($ 9 billion) on gasoline subsidies last year.

This is what the government attributes to declining public finances.

According to its data, NNPC failed to deposit money into federal accounts last year, leaving a gap in the government’s budget at a time when it had previously warned that it would be unable to stimulate the economy due to low revenues and huge deficits.

Nigeria’s 200 million-person nation’s successive governments have attempted and failed to eliminate or reduce the subsidy, which is a politically delicate topic.

Due to years of neglect, local refineries in Nigeria had to close, so almost all of the country’s refined fuels are imported.

Crude theft and pipeline vandalism have slowed down oil output, which means Nigeria is paying more on fuel imports than it is making from producing crude oil.

According to finance minister Zainab Ahmed, the nation has set aside 3.36 trillion naira ($7.5 billion) to continue its expensive but well-liked gasoline subsidy through the middle of this year.

The subsidy will end in June, according to the administration of President Muhammadu Buhari, but it’s unclear what will happen because the country anticipates a new administration taking over on May 29 after next month’s presidential election.

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