The Petroleum Products Pricing Regulatory Agency (PPPRA) announced the full withdrawal of subsidies from Petrol (Premium Motor Spirit).
According to a statement signed by the agency’s executive secretary, Reginald Stanley, the removal takes effect from today, January 1, 2012.
It said in part that the agency “…wishes to inform all stakeholders of the commencement of formal removal of subsidy on Premium Motor Spirit (PMS), in accordance with the powers conferred on the agency by the law establishing it, in compliance with Section 7 of PPPRA Act, 2004.
“By this announcement, the downstream sub-sector of the petroleum industry is hereby deregulated for PMS. Service providers in the sector are now to procure products and sell same in accordance with the indicative benchmark price to be published fortnightly and posted on the PPPRA website.
“Petroleum products marketers are to note that no one will be paid subsidy on PMS discharges after 1st January 2012.”
The debate for the removal of subsidy on petrol which was introduced initially as a fallout from a meeting of the Governor’s Forum on June 21, 2011 as a precondition to their payment of the then newly approved N18,000 minimum wage later transformed into a federal government-driven project upon which it claims the survival of the nation’s economy rests.
President Goodluck Jonathan had presented the budget proposal for 2012 without making provision for the subsidy, further heightening concerns that the government was following through on the plan to end the subsidy even though the government had assured the Nigerian public that it was still ‘consulting’ stakeholders and had not made a decision yet.
UK news agency REUTERS on Thursday claimed the International Monetary Fund (IMF) was behind the push by governments across West Africa to remove petrol subsidies. Ghana officially ended hers on Thursday December 29, 2011. Other countries which the report said were under similar pressure are Cameroon, Guinea and Chad.
Nigeria’s Ministry of Finance however denied the claims made in the report.