How Fuel and Foreign Exchange Subsidies Deepened Nigeria’s Debt Burden Under Buhari

In my view, the fuel subsidy regime under former President Muhammadu Buhari became increasingly difficult to sustain. As subsidy costs rose, crude-oil revenue was no longer enough to cover the bill, leading the government to rely more heavily on borrowing. Nigeria is still affected by crude-backed financial commitments linked to the subsidy period. I also argue that the NNPC remitted little or nothing to the national treasury during the administration, while the country’s debt climbed beyond 80 billion dollars by the time Buhari left office. The government also maintained an official exchange rate far below the parallel-market rate. I believe this created an additional subsidy on foreign exchange and enabled arbitrage, with many beneficiaries reselling dollars through bureau de change operators. Those calling for a return to the old subsidy system should consider the debt and fiscal pressure it placed on the country.

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