Get Ready Nigerians for fuel Increase- Rewane
The chief executive officer of Financial Derivatives Company Limited, Bismarck Rewane, wants Nigerians to be prepared for an increase in the pump price of the Premium Motor Spirit (PMS), popularly called petrol.
There have been speculations that the government of President Muhammadu Buhari might increase the pump price of petrol. Giving details of his thought on the issue, Rewane who made a presentation at the Lagos Business School said the increase would come because the government is working towards reducing subsidy payments.
According to report Rewane said subsidies are a huge drain on government’s revenue and that the World Bank puts Nigeria’s total subsidy bill in 2018 at N731 billion. “A gradual reduction in subsidy payments is anticipated.
Only N305bn set aside for under-recovery in 2019 budget; expect an increase in the pump price of fuel.
“Forty percent shortfall in provision for subsidies (under-recoveries) points to possible price increases,” he said adding that an increase in the pump price of fuel will cause high inflationary pressure.
Rewane argued that the Nigerian economy is in serious need of a boost explaining further that with expenditures higher than sustainable revenues, the fiscal deficit had widened by 2.15% to N1.9 trillion. Rewane also argued that internally-generated revenue is the main key to meeting the challenge of the new minimum wage.
He said it is not sustainable to rely on the Federal Accounts Allocation Committee (FAAC). To him, the capacity of Buhari’s economic management team will be a determinant to the success of the president in the second term.
He projected that there might be crisis in the APC following the new cabinet members to be selected by President Buhari while four governorship races would be affected by the election tribunal results.
It was reported that President Muhammadu Buhari on Tuesday, May 14, inaugurated a committee to implement the new national minimum wage, almost one month after he signed the bill into law.
Winifred Oyo-Ita, the head of the civil service of the federation, was appointed the chairman of the committee.