By Ghazali Ibrahim
The Federal Government has reaffirmed that it will not reinstate fuel subsidy, despite growing public concern over the rising cost of living since its removal.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, made the position clear on Tuesday in Paris during a meeting between President Bola Tinubu and international investors.
Oyedele argued that the former subsidy regime created economic distortions and maintained that petrol prices would remain deregulated, with market forces determining costs.
“We will not bring back fuel subsidy because it creates distortions for the economy, and we won’t introduce price control because we believe in the market,” he said, while also noting that shifting global dynamics, including developments in Iran, present new investment opportunities for Nigeria.
Nigeria has faced significant economic pressure since the subsidy removal in May 2023, with inflation surging to a 19-year high. Headline inflation rose from 22.41 percent in May 2023 to 34.19 percent by June 2024, driven largely by increases in fuel, transportation, and food prices. Food inflation alone exceeded 39 percent by October 2024, further straining household incomes.
The policy shift, combined with currency devaluation, led to a sharp rise in transport costs estimated at nearly 300 percent and contributed to worsening poverty levels across the country.
Addressing investors at the meeting, President Tinubu said the removal of subsidy had helped stabilise Nigeria’s foreign exchange market.
“Subsidy that was a burden to the entire country was removed, and ever since we have achieved FX stability,” he stated.
According to a statement by the President’s Adviser on Information and Strategy, Bayo Onanuga, the administration’s reform agenda is focused on eliminating structural inefficiencies and strengthening macroeconomic stability for long-term growth.
Oyedele also highlighted what he described as improved economic performance, noting that Nigeria recorded an 11.2 percent GDP growth in dollar terms in 2025. He said this aligns with the government’s ambition of building a $1 trillion economy by 2030.
He added that the government would prioritise ensuring that ongoing reforms deliver tangible benefits to citizens, including the regular publication of quarterly financial reports to boost transparency.
