The Nigerian government has confirmed the complete removal of both fuel and foreign exchange (FX) subsidies as part of efforts to address the country’s economic struggles.
This was reiterated by the Minister of Finance, Wale Edun, during the presentation of the Nigeria Development Update by the World Bank in Abuja.
In his statement, Edun emphasized the permanent end of these subsidies, highlighting the severe financial impact they had on Nigeria’s economy.
He revealed that the country lost over N10 trillion due to the fuel and FX subsidies, which accounted for approximately five percent of the nation’s Gross Domestic Product (GDP). These subsidies, according to Edun, had placed a significant burden on the country’s finances.
“Fuel and FX subsidies are extinguished,” Edun said, reiterating the government’s stance on these policies. He explained that the removal was necessary to relieve the nation from the financial strain it had been enduring for years.
In addition to the removal of subsidies, the Minister also announced a new government plan aimed at reducing unemployment in Nigeria.
According to him, the government will focus on housing finance to stimulate job creation. The strategy will concentrate on boosting the construction sector by facilitating access to mortgages and housing financing.
“The government expects this approach to boost construction activities and generate significant job creation. The plan will be anchored around mortgage and housing financing,” Edun stated.
At the same event, the Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, addressed the rationale behind the recent increase in the interest rate, which now stands at 26.75 percent. He explained that the decision to raise rates was based on data-driven strategies aimed at mitigating the Naira’s depreciation and controlling inflation.
“Policies and decisions will be based on evidence and data going forward,” Cardoso added, stressing that future economic actions will be guided by empirical evidence.
