Experts say the Nigerian economy will be negatively impacted by the N4 trillion vote for petrol subsidy in the revised 2022 budget that was passed yesterday by the National Assembly.
The lawmakers agreed to President Muhammadu Buhari’s request for adjustments to the 2022 fiscal framework.
They approved a revised budget of over N17 trillion for this fiscal year with a provision of N4 trillion for petrol subsidy.
The police got an increase of N182 billion to take care of salaries.
The size of the 2022 budget was increased to N17,319,704,091,019 from an initial N17,126,873,917,692.
The Centre for the Promotion of Private Enterprise Chief Executive, Dr. Muda Yusuf, is concerned about the country’s macroeconomic outlook in the near term.
He said: “The outcome of these approvals include increased borrowing, higher debt service, the surge in fiscal deficit, heightening inflationary pressure, and a risk of further depreciation in the naira exchange rate.”
He added: “The combination of debt service and petrol subsidy is likely to consume the entire revenue.
“We should brace for more challenging times. Major reforms necessary to return the economy to a recovery and growth path are unlikely to happen in the near term.
“This is coupled with the distractions that come with electioneering and transition periods.”
The National Operations Controller of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Mike Osatuyi, said the N4 trillion subsidy “is child’s play because we are still heading to an N6 trillion subsidy regime by year-end”.
