Wale Edun, Nigeria’s finance minister, revealed that the country had saved $20 billion by eliminating gasoline subsidies and implementing market-based foreign exchange pricing.
He said this during a recent ceremony in Abuja commemorating the first 100 days of Esther Walso-Jack’s tenure as the federation’s head of civil service.
“An amount of five per cent of GDP is what those two subsidies were costing when there was a subsidy on PMS; when there was petroleum product generally for a long time and when there was a subsidy of foreign exchange. Between them, they were costing five percent of GDP.
“If you say GDP was on average, let’s say $400 billion. We all know what five percent of that is $20 billion of funds that could be going into infrastructure, health, social services, education,” he said.
Edun said these flows now return into the government’s coffers for further deployment to the aforementioned sectors.
“The real change that has happened with the measures of Mr. President is that nobody can wake up and their target for the day or for the week or the month or the year is to get access to cheap funding, cheap funding exchange from central bank, which they can now flip.
“And overnight, they become wealthy from no value added for doing virtually nothing, except you know the right people. Similarly, they can no longer try and be part of a new peak market and very inefficient petrol subsidy regime as a way of making money overnight,” Edun added.
