Nigeria Must Not Return to Petrol Subsidy: Invest in Production Instead

Nigeria should be honest about the cost of the old petrol-subsidy regime. For years, trillions of naira were used to keep petrol prices artificially low. Much of that money could have supported infrastructure, education, healthcare, electricity, agriculture and other productive sectors. Nigeria also faced fuel smuggling across its borders, effectively extending the benefit beyond its own citizens. Petrol subsidy was not responsible for every national problem. Corruption, weak institutions, poor management and insecurity also played major roles. Still, the opportunity cost was enormous. Roads, water systems, power supply and public facilities remained inadequate while public funds were repeatedly spent on subsidising consumption. A large share of those funds could have transformed agriculture through irrigation, storage, rural roads, processing plants, affordable loans and modern equipment. Such investments would help farmers produce more food, create jobs, reduce imports and build lasting businesses. Subsidising consumption may offer temporary relief, but investing in production can create permanent wealth. The real debate is not only whether subsidy was good or bad, but what Nigeria could have achieved if those trillions had consistently built its productive capacity.

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