nedu666:



China did not devalue its currency because inf said so but to aid its export driven economy. If not, why the imf and America declare China a currency manipulator. The Asian tigers who implemented imf policies during the Asian currency crisis of the 1990s later ditched such policy to follow their home grown policy

Exactly!

China had a functional export driven economy and so devaluation was beneficial to them. The Bretton Woods institutions (IMF and friends) were not happy with this move. Come to Nigeria and you’d see the exact opposite - an economy that is largely imports dependent. Not only is consumption imports driven, manufacturing is also imports driven because the equipments they require to produce are largely sourced abroad.

Max24:

First thank you for admitting that China devalued it's currency in it's interest. But the way the author put it as if other countries have not used it successfully.
Secondly, I don't have to name give other countries beside China. When I do you would come up with another excuse.
Thirdly, if it is such a bad policy other world class economists like NOI, Adesina, Soludo, Nigerian professors would have come out to fault the policy. Do you think Tinubu act without conducting case studies? Only the gullible are deceived by the antics of the writer and we know their game plan.

It seems you do not understand what SAP is. It is not just about devaluing the currency. That's just one step. Removing subsidies and cutting government spending are also part of it. Removing import restrictions which IMF calls opening up the economy is another. Did China do all that?
NOI, Adesina, Soludo are pro-capitalist economists. Even at that, I'm surprised you're quick to claim their support. If they had spoken otherwise, I'm sure you'll have found an appropriate label for each of them. OBJ just spoke against the policies recently. I don't think you'll accept his criticism.
Tinubu obviously acted on IMF recommendations. If you have information about case studies, share and enlighten cynics like me

Max24:
All that is written above are all bladerdash ! The writer is either a political jobberman or ignorant. First the fact that Babangida failed while implementing those policies does not invalidate the economic policies or make Tinubu approach an automatic failure. He conveniently gave us examples of places or times when it failed without telling us if places and times where it succeeded. Removal of subsidy and devaluation of a countries currency are not new approaches to management of economies. Big countries have used it successfully and prospered. Did China not use same strategies and succeed and now competing with America and others. Didn't China devalue it's currency at some point and time and hugely benefited from it. The truth is that whatever policy you implement depends on the knowledge of the implementer and how it's done not on the policy and I have no doubt that Tinubu knows what he is doing. Yes, temporary hardships even in Malaysia he cited it was never smooth ride, so please stop brainwashing us. He is a fake prophet preaching heaven without dieing, which is impossible..
Atikus project #2027 commissioned envelope writers !

China never implemented these ridiculous policies, please stop lying. These [policies have never succeeded in a single country in the world.

DeepSight:


China never implemented these ridiculous policies, please stop lying. These [policies have never succeeded in a single country in the world.

Was there no inflation in US during the time of trump? Even UK removed subsidy on different items at different times in their best interest. But nobody has answered my question. What did we achieve with the fuel subsidy we benefited from since independence?

helinues:
Another Engrish

This analysis is too smart to be ignored. We learn from history. This isn't SBT trivial argument but doing what's right for our nation

I read everything you wrote.

And it's clear you didn't read a single sentence from the OP.

Shame on you and your "I believe" jargon.

Unlike Martin Luther King whose I believe speech was given for the betterment of millions- yours is given to support your god, Tinubu

Faiththatworks:
I believe Asiwaju did the best thing for Nigeria by removing the parallel exchange rate operated by the CBN and also the fuel subsidy.
Only President Jonathan attempted to remove the Fuel subsidy and some members of the opposition party used it as one of their campaign manifesto to remove him.
Whether we agree or disagree,the removal of fuel subsidy and unifying the exchange rate is enough to remove any government as seen by the hardship in Nigeria but I really really respect Asiwaju for refusing to back down and reintroduce those subsides.
There's hardship in Nigeria and no one should try to cover it up,my advice to Asiwaju is for him to find quick emergency fixes for the country.
I can testify the power situation is really improving, although I don't know if if the same in other parts of the country,this has helped cover up the fuel scarcity that has been lingering for almost a month.
Asiwaju must ensure whatever the Ministry of Power is doing is improved on.
Asiwaju must also order NNPCL to sell subsidize crude oil to Dangote for the next 6 months so he can deliver refined petrol,diesel, kerosene and Aviation fuel.
This will really help to reduce the pump price of these products and help Asiwaju look for more sustainable results in the months ahead.
Finally he must sack the parasitic element in NNPCL,those guys will never allow Nigeria function as far as they are importing refined fuel into Nigeria.
God bless Nigeria

Max24:

And you think Tinubu does not know all these? Some of you think you are the only one with intelligence. All that write up because of one year hardship. So you people really think continuing with subsidy and defending the naira like we have done since independence without anything to show for it is the best way to keep going. You want a change in your country without trying something new, how is that possible? Only a mad man keeps doing something the same way and expect a different outcome. Now Tinubu is trying to change from the status quo and you people are trying to frustrate him. Since independence we can't generate 6,000 MWt of power and you want us to continue as before? Is that how SA attained it's own power capability? You people always quote other countries progress without telling us the sacrifices they made. Do you think they got there sleeping on a bed of roses?

Did you read the Op or you deliberately missed the point. There's nothing Tinubu is doing that's new. He's not changing any status quo. He's doing same thing Babangida did in 1986 christened SAP and he's getting the same result.

OBJ also attempted it but was heavily resisted by Tinubu backed NLC.

Goodluck also had the same luck while attempting it.

So how did Tinubu who was to the left of these policies when he was not in office become a latter day reformist? You missed the gist of the Op.

And it is false to claim Nigeria has been paying subsidy and defending naira since independence. At least basic history teaches us that naira was introduced in 1973.
Subsidy for fuel first appeared in the late 70s in Nigeria.
At least get your facts right if you want to argue

Max24:

Was there no inflation in US during the time of trump? Even UK removed subsidy on different items at different times in their best interest. But nobody has answered my question. What did we achieve with the fuel subsidy we benefited from since independence?

My dear, look let me not waste time going through the philosophy of the matter - which I can see we will disagree on based on your posts with other people up there. I will only say that the IMF/ Bretton Woods prescriptions have been around for decades and have never worked in a single third world country. They have rather consistently destroyed lives and economies everywhere they have been implemented - so much so that it is obvious that the destruction of lives and the pauperization of populations is actually what those policies were deliberately designed for and history proves this.

As I said, let me not waste your time with arguing the philosophy of it - let me just go to the practicality. Let us assume you needed to remove subsidies, fine. No where in the world would you remove them in one fell swoop the way it was done in this country last year. That is unheard of. The spike in PMS price was over 200 per cent - and believe you me, I have researched this matter - there had never been such an increase in the price of PMS in a single day in any country in the world. Other countries which removed subsidies did so gradually over time in order to reduce the shock to the system. One does not have to be an economist to know that the ripple effects on the prices of other commodities will lead to hyper-inflation which is what has obviously happened. And there is no way that is good for the economy. If it must have been done, it should have been done in phases. Carefully managed phases.

Now as if that was not bad enough, you then proceeded to float the naira immediately at the same time. This was the biggest disaster of all. You have to understand a number of things. First is that an import dependent economy cannot afford to float or devalue its currency, That is a prescription for suicide. Because if you import everything you use, as we do, then you are spending USD all the time and if you devalue your currency then you will require more and more of your currency to procure less and less USD and that will finish you off in a vicious cycle - because the more USD you chase the more your currency will fall.

But it was not just this obvious principle that made it a disaster - what made it the greatest disaster is the fact that you are importing the said PMS you have removed subsidies from. You are paying USD for the PMS, and thus it stands to reason that once your currency falls, you will pay even more USD for that PMS and this is why the landing cost of PMS has become so high, that it is now obvious that the government is in fact still paying some subsidy to retain the price at circa N600 - because based on the exchange rate it should be over N1, 000.

Therefore by flloating the naira at the same time as removing subsidy, the FG actually defeated the purpose of subsidy removal.

The net result has been the death, destruction and unspeakable hardship which has followed. The truth is that these policies are ill thought out and they have never succeded in any third world country where they have been prescribed, and they frankly were not intended to.

Now, to adderss your question "what have we acheived through fuel subsidy since indpendence" - the answer is very simple and it is staring you in the face. Sometimes you dont know what you have until you lose it. The safety net that the economy had from this kind of devastation and hardship is what we acheived. Just compare the ecomony of a mere one and a half years ago to what obtains today and you will see the difference. That is what it is.

No economy can grow when you deflate it and take away the purchsing power of the people. Everywhere economies have grown, there has been an injection, and not a deflation. The devaluation of the naira accompanied with hyper inflation has made every Nigerian vastly poorer. And there is nothing positive about a pauperized population - let no one deceive you - there is no long term gain in such. It will only ever deliver death and hardship.

Finally please stop comparing the removal of subsidies in places like the UK with what has happened here. Not only are the subsidies not the same and the products being subsidized not the same, the entire picture is different. This is aside from the fact that no one was insane enough to remove 100 percent of a critical subsidy in a single day. Anyone who does that to his country is bent on destroying it.

cc nairalanda1 / kukutenla / kukutente23.

Max24:

Was there no inflation in US during the time of trump? Even UK removed subsidy on different items at different times in their best interest. But nobody has answered my question. What did we achieve with the fuel subsidy we benefited from since independence?

The main issue is the opaqueness of the oil sector. Are you sure that subsidy is actually gone? Because landing price of PMS is still higher than the amount being charged by oil marketers. Boosting of the domestic output would reduce importation and reduction or elimination of importation will naturally remove the need for subsidies in the first place.
There is so much “abrakadabra” in that sector. Firstly we hear new dates that the Port-Harcourt refinery will kickstart every now and then. Then to the Dangote Refinery - it’s one story after the other. They complain that there are internal and external cabals. Who are these people? Is it the mechanic on the street that will fight these cabals? With snippets of information that government officials allegedly own refineries abroad, you cannot help but scratch your head and ask if the sector is not being intentionally sabotaged. As someone would say, oil theft is not pilfering candy at a local store but it is organized crime, any sincere move to sanitize that sector would involve a lot of probing and bringing people to book. Subsidy no doubt was draining the resources of the state but even if the removal of the subsidy was meant to address this problem of draining revenues, the question to ask is - what will the government do with more funds in their hands? If you say that the allocations to state governments is higher and you don’t even have a concrete plan on how to use the funds to alleviate the direct problems that the subsidy removal will cause, you need to think circumspectly.

DeepSight:


My dear, look let me not waste time going through the philosophy of the matter - which I can see we will disagree on based on your posts with other people up there. I will only say that the IMF/ Bretton Woods prescriptions have been around for decades and have never worked in a single third world country. They have rather consistently destroyed lives and economies everywhere they have been implemented - so much so that it is obvious that the destruction of lives and the pauperization of populations is actually what those policies were deliberately designed for and history proves this.

As I said, let me not waste your time with arguing the philosophy of it - let me just go to the practicality. Let us assume you needed to remove subsidies, fine. No where in the world would you remove them in one fell swoop the way it was done in this country last year. That is unheard of. The spike in PMS price was over 200 per cent - and believe you me, I have researched this matter - there had never been such an increase in the price of PMS in a single day in any country in the world. Other countries which removed subsidies did so gradually over time in order to reduce the shock to the system. One does not have to be an economist to know that the ripple effects on the prices of other commodities will lead to hyper-inflation which is what has obviously happened. And there is no way that is good for the economy. If it must have been done, it should have been done in phases. Carefully managed phases.

Now as if that was not bad enough, you then proceeded to float the naira immediately at the same time. This was the biggest disaster of all. You have to understand a number of things. First is that an import dependent economy cannot afford to float or devalue its currency, That is a prescription for suicide. Because if you import everything you use, as we do, then you are spending USD all the time and if you devalue your currency then you will require more and more of your currency to procure less and less USD and that will finish you off in a vicious cycle - because the more USD you chase the more your currency will fall.

But it was not just this obvious principle that made it a disaster - what made it the greatest disaster is the fact that you are importing the said PMS you have removed subsidies from. You are paying USD for the PMS, and thus it stands to reason that once your currency falls, you will pay even more USD for that PMS and this is why the landing cost of PMS has become so high, that it is now obvious that the government is in fact still paying some subsidy to retain the price at circa N600 - because based on the exchange rate it should be over N1, 000.

Therefore by flloating the naira at the same time as removing subsidy, the FG actually defeated the purpose of subsidy removal.

The net result has been the death, destruction and unspeakable hardship which has followed. The truth is that these policies are ill thought out and they have never succeded in any third world country where they have been prescribed, and they frankly were not intended to.

Now, to adderss your question "what have we acheived through fuel subsidy since indpendence" - the answer is very simple and it is staring you in the face. Sometimes you dont know what you have until you lose it. The safety net that the economy had from this kind of devastation and hardship is what we acheived. Just compare the ecomony of a mere one and a half years ago to what obtains today and you will see the difference. That is what it is.

No economy can grow when you deflate it and take away the purchsing power of the people. Everywhere economies have grown, there has been an injection, and not a deflation. The devaluation of the naira accompanied with hyper inflation has made every Nigerian vastly poorer. And there is nothing positive about a pauperized population - let no one deceive you - there is no long term gain in such. It will only ever deliever death and hardship.

Finally please stop comparing the removal of subsidies in places like the UK with what has happened here. Not only are the subsidies not the same and the products being subsidized not the same, the entire picture is different. This is aside from the fact that no one was insane enough to remove 100 percent of a critical subsidy in a single day. Anyone who does that to his country is bent on destroying it.

cc nairalanda1 / kukutenla / kukutente23.

Absolutely spot on

Kukutenla:

It seems you do not understand what SAP is. It is not just about devaluing the currency. That's just one step. Removing subsidies and cutting government spending are also part of it. Removing import restrictions which IMF calls opening up the economy is another. Did China do all that?
NOI, Adesina, Soludo are pro-capitalist economists. Even at that, I'm surprised you're quick to claim their support. If they had spoken otherwise, I'm sure you'll have found an appropriate label for each of them. OBJ just spoke against the policies recently. I don't think you'll accept his criticism.
Tinubu obviously acted on IMF recommendations. If you have information about case studies, share and enlighten cynics like me

Bodied that lokan man😄😄

Kukutenla:

Did you read the Op or you deliberately missed the point. There's nothing Tinubu is doing that's new. He's not changing any status quo. He's doing same thing Babangida did in 1986 christened SAP and he's getting the same result.

OBJ also attempted it but was heavily resisted by Tinubu backed NLC.

Goodluck also had the same luck while attempting it.

So how did Tinubu who was to the left of these policies when he was not in office become a latter day reformist? You missed the gist of the Op.

And it is false to claim Nigeria has been paying subsidy and defending naira since independence. At least basic history teaches us that naira was introduced in 1973.
Subsidy for fuel first appeared in the late 70s in Nigeria.
At least get your facts right if you want to argue

Everybody knew subsidy was not sustainable and not in the long term interest of Nigeria. All past presidents without exception agreed in theory that it had to go. Even Nigerian born economists like NOI believed same. The only issue was when. Jonathan simply didn't have the political will to do it. All the same the important thing is that it is the right way to go. Is it a bed of roses? No. Painful, yes but necessary. Tinubu is just a well prepared courageous leader. He confronted the subsidy dilemma same way he confronted the states subjugation of LGAs autonomy. And you can see the instant effect in projects undertaken by LGAs in Lagos. The LGA conundrum that most past presidents including Buhari couldn't achieve Tinubu bodily achieved it and no heavens fell. Who would have believed that a Nigerian president can rule against the all powerful governors. The same govs that brought the downfall of Jonathan. That is a signal of Tinubu's doggedness and conviction. It's not by making noise. He is already restructuring Nigeria politically and economically without making noise about it. That is the Hallmark of a great leader not the submissions of a brown envelope politically exposed journalist. Lagos success remains a template for the whole country to emulate.

Lookmun:
f you say that the allocations to state governments is higher and you don’t even have a concrete plan on how to use the funds to alleviate the direct problems that the subsidy removal will cause, you need to think circumspectly.

Even this point about allocations to states being higher is lost on me. Why? Because what is the point increasing my salary by 100 per cent when the cost of living has increased by 300 per cent? One cancels out the other, simple. The 100 naira of last year is worth only 30 naira of last year now. Therefore in real terms the so called increase in allocations is useless.

It is very much like the increase in minimum wage which has brought an amount that cannot buy what the former minimum wage could buy last year.

In every direction, the government has defeated itself.

Max24:

Was there no inflation in US during the time of trump? Even UK removed subsidy on different items at different times in their best interest. But nobody has answered my question. What did we achieve with the fuel subsidy we benefited from since independence?

Inflation during the time of Trump? You're badly misinformed dude. US had historically low inflation figures during Trump's time that even Obama had to start trying to take some credit for how well the economy was doing.
We achieved a relatively better standard of living if nothing else and more equitable national wealth distributing.
Nigerians today are living worse than peasants while their rulers are becoming fatter like Emperors.

Lookmun:

The main issue is the opaqueness of the oil sector. Are you sure that subsidy is actually gone? Because landing price of PMS is still higher than the amount being charged by oil marketers. Boosting of the domestic output would reduce importation and reduction or elimination of importation will naturally remove the need for subsidies in the first place.
There is so much “abrakadabra” in that sector. Firstly we hear new dates that the Port-Harcourt refinery will kickstart every now and then. Then to the Dangote Refinery - it’s one story after the other. They complain that there are internal and external cabals. Who are these people? Is it the mechanic on the street that will fight these cabals? With snippets of information that government officials allegedly own refineries abroad, you cannot help but scratch your head and ask if the sector is not being intentionally sabotaged. As someone would say, oil theft is not pilfering candy at a local store but it is organized crime, any sincere move to sanitize that sector would involve a lot of probing and bringing people to book. Subsidy no doubt was draining the resources of the state but even if the removal of the subsidy was meant to address this problem of draining revenues, the question to ask is - what will the government do with more funds in their hands? If you say that the allocations to state governments is higher and you don’t even have a concrete plan on how to use the funds to alleviate the direct problems that the subsidy removal will cause, you need to think circumspectly.

I totally agree with you my brother. I dont have problem with govt raising revenue but I strongly believe it must be accounted for. If you check my past posts you will notice that I always believe in accountability at all levels. That why I regard the senators as looters because they have been hiding their salaries and allowances for long. And I truly understand you argument about whether subsidy has been fully removed or not but since their is improved revenue let's start demanding accountability from everyone - Federal, States and LGAs. Also, all the salaries and allowances of legislators should be public knowledge. Remove subsidy but enforce accountability. It will quicken our growth. Why can't we have some Kigali in Nigeria starting from Lagos ?

Racoon:

In today's Saturday Tribune column, I compare Tinubu's "economic reforms" to IBB's SAP and the experiences of Latin American countries that used the IMF/World Bank-backed "reforms" Tinubu is implementing. I also highlight the example of Malaysia that bucked the IMF and developed.
~~~~~~
The President Bola Ahmed Tinubu administration likes to psychologically anesthetize Nigerians who are grieving from the hurt of its economic policies (petrol price spike, electricity tariff hike, devaluation of the naira, etc.) by saying Nigerians are only undergoing transitory pains in the service of a forthcoming permanent prosperity.

I have repeatedly called this an intentional lie. I have done so from the benefit of my knowledge of the outcomes of such policies in other countries, including in Nigeria from 1986 to 1993 when Ibrahim Badamasi Babangida implemented a Structural Adjustment Program (SAP) as dictated by the World Bank and the IMF, which is similar to Tinubu’s “reforms.”
~~~~~
But let’s start with SAP in Nigeria. In 1986, self-described military president Ibrahim Badamasi Babangida was persuaded by the IMF and the World Bank to “restructure and diversify” Nigeria’s economy.

The restructuring and diversification led to the removal of subsidies on petrol (all past regimes called petrol price spikes “subsidy removal”), devaluation of the naira (now it’s known by the fancy term “floating of the naira”), deregulation (that is, allowing market forces to regulate the economy while the government takes the back seat), privatization (i.e., selling off of Nigeria’s national patrimony to a few moneybags), etc.

The immediate aftereffect of this IMF-endorsed “restructuring” (Tinubu calls his “reform”) of the economy was a never-before-seen inflationary conflagration, which eroded the purchasing power of the average Nigerian. It produced widespread hardship similar to what Nigerians are going through at this moment.

Petrol price spike and privatization led to job losses and a deepening of the unemployment crisis. Reduction in government spending, particularly on social services, led to declines in healthcare and education quality. Poverty rates also increased as a direct consequence of the removal of subsidies for fuel and basic services.

I distinctly remember all the rhetorical maneuvers that officials of the IBB regime used to fray nerves, and they are awfully similar to what honchos of the Tinubu regime now use: it will get worse before it gets better, there is light at the end of the tunnel, there is no gain without pain, Nigeria simply can’t afford to fund subsidies, our economy would collapse if we don’t restructure the economy, the current system is unsustainable, we’ll all smile and appreciate the wisdom of this temporary sacrifice when the gains start coming, etc.

By 1993 when IBB left power, Nigeria became firmly secured in the economic toilet. Manufacturing collapsed, social unrest rose, and brain drain (which is now called “japa”) started and blossomed, and hopelessness was democratized.



https://www.farooqkperogi.com/2024/08/tinubus-economic-reforms-nightmarish.html

Farooq's perspective is insightful and his take about Gen. Ibrahim Babangida's introduction of the Structural Adjustment Program (SAP) in 1986 is historically correct (indeed in 1989, there were violent anti-SAP protests in Lagos State and other States as well that led to lootings, and snatching of valuables from people). As a man who was alive in the 1980s, I witnessed the years of Gen. Gowon, Gen. Murtala, Gen. Obasanjo, President Shagari, Gen. Buhari and Gen. IBB military years of the 1980s. Farooq's write-up was quite concise but he missed a point in that the Babangida and Tinubu experiences CANNOT be seen as the same in terms of economic policy implementation.

However, the advantage which IBB DIDN'T have back in the 1980s is that President Bola Ahmed Tinubu has the extra advantage of the introduction of CNG fuel as a CHEAPER alternative source of fuel which IBB DIDN'T have. Already from information out in the public domain, there are already 12 brand new NNPC CNG stations in Lagos State and Abuja with more being planned in other parts of Nigeria. Already from information online, the new NNPC CNG station in Lagos State which was launched on May 30, 2024, has been selling CNG at the cheapest price of N200 per standard cubic feet to happy private car owners and truck drivers who have witnessed a sharp drop in money spent on fueling their vehicles instead of using the MORE expensive PMS fuel with is selling at close to N1000 in a lot of places from my online investigations.

Consequently, the Presidential CNG Initiative is ALSO converting over 1 million commercial vehicles for FREE or nearly free in order to be able to use the cheaper CNG fuel as of this moment and as President Tinubu clearly said towards the end of his speech to Nigerians of Sunday August 4, 2024 (which a lot of Nigerians in the Diaspora and in Nigeria eagerly awaited) this deployment of CNG with free conversation of commercial vehicle to use CNG would LOWER the cost of transportation and expensive food items by a HUGE 60% OR MORE! Price checks of food items will also have to be put in place when CNG is fully available to these converted commercial vehicles to ensure that greedy commodities and food stuff sellers do NOT continue to quote higher prices to the end buyers.

CNG is meant to LARGELY replace (or complement PMS usage which is more expensive and has led to higher costs of transportation). It would ALSO lead to less visits to the auto mechanics and it's NOT as combustible as the regular LPG cooking gas.

A lot of people with short attention span were FALSELY saying after that Sunday speech that Tinubu didn't address the fuel issue, but he did. President Tinubu and his speech writers however could have done better by reducing the length of the speech while ALSO putting the CNG supply and FREE conversions of 1 million commercial vehicles information right at the top of the speech to quickly grab the attention of Nigerians and let Nigerians know the CHEAPER advantage of buying CNG at N200 per standard cubic feet. This should have been done because a lot of human beings have short attention spans and are NOTORIOUSLY impatient with LONG speeches, while some are just filled with bigotry and hatred, so, would pretend NOT to acknowledge what a rival is saying. I wasn't surprised when after the speech, a lot of people who did NOT fully pay attention to that Presidential speech started lashing out in anger that he didn't say anything about the introduction of cheap fuel through the re-introduction of fuel subsidies. The President Tinubu should ALSO have CLEARLY asked Nigerians for two months timeframe for the rapid deployment and conversions of these commercial vehicles to use CNG fuel and hence lower prices of transportation and drop artificial inflation which is fueled by high fuel and food prices which a significant number of folks in Nigeria say they are finding very difficult to afford.

Effective communication is very important on the part of the governments at all levels, AND active listening and effective communication are also important for a lot of Nigerians to imbibe because MANY Nigerians are sometimes notoriously impatient and do NOT pay attention to little details.




Cc: Naptu2, helinues, FreeStuffsNg

Kukutenla:

Inflation during the time of Trump? You're badly misinformed dude. US had historically low inflation figures during Trump's time that even Obama had to start trying to take some credit for how well the economy was doing.
We achieved a relatively better standard of living if nothing else and more equitable national wealth distributing.
Nigerians today are living worse than peasants while their rulers are becoming fatter like Emperors.

I have been following the Harris - Waltz campaigns and that's not what they are saying and I believe those guys don't lie openly like trump. They also said trump tenure had the highest unemployment in recent times. Such videos are on YouTube.

DeepSight:


My dear, look let me not waste time going through the philosophy of the matter - which I can see we will disagree on based on your posts with other people up there. I will only say that the IMF/ Bretton Woods prescriptions have been around for decades and have never worked in a single third world country. They have rather consistently destroyed lives and economies everywhere they have been implemented - so much so that it is obvious that the destruction of lives and the pauperization of populations is actually what those policies were deliberately designed for and history proves this.

As I said, let me not waste your time with arguing the philosophy of it - let me just go to the practicality. Let us assume you needed to remove subsidies, fine. No where in the world would you remove them in one fell swoop the way it was done in this country last year. That is unheard of. The spike in PMS price was over 200 per cent - and believe you me, I have researched this matter - there had never been such an increase in the price of PMS in a single day in any country in the world. Other countries which removed subsidies did so gradually over time in order to reduce the shock to the system. One does not have to be an economist to know that the ripple effects on the prices of other commodities will lead to hyper-inflation which is what has obviously happened. And there is no way that is good for the economy. If it must have been done, it should have been done in phases. Carefully managed phases.

Now as if that was not bad enough, you then proceeded to float the naira immediately at the same time. This was the biggest disaster of all. You have to understand a number of things. First is that an import dependent economy cannot afford to float or devalue its currency, That is a prescription for suicide. Because if you import everything you use, as we do, then you are spending USD all the time and if you devalue your currency then you will require more and more of your currency to procure less and less USD and that will finish you off in a vicious cycle - because the more USD you chase the more your currency will fall.

But it was not just this obvious principle that made it a disaster - what made it the greatest disaster is the fact that you are importing the said PMS you have removed subsidies from. You are paying USD for the PMS, and thus it stands to reason that once your currency falls, you will pay even more USD for that PMS and this is why the landing cost of PMS has become so high, that it is now obvious that the government is in fact still paying some subsidy to retain the price at circa N600 - because based on the exchange rate it should be over N1, 000.

Therefore by flloating the naira at the same time as removing subsidy, the FG actually defeated the purpose of subsidy removal.

The net result has been the death, destruction and unspeakable hardship which has followed. The truth is that these policies are ill thought out and they have never succeded in any third world country where they have been prescribed, and they frankly were not intended to.

Now, to adderss your question "what have we acheived through fuel subsidy since indpendence" - the answer is very simple and it is staring you in the face. Sometimes you dont know what you have until you lose it. The safety net that the economy had from this kind of devastation and hardship is what we acheived. Just compare the ecomony of a mere one and a half years ago to what obtains today and you will see the difference. That is what it is.

No economy can grow when you deflate it and take away the purchsing power of the people. Everywhere economies have grown, there has been an injection, and not a deflation. The devaluation of the naira accompanied with hyper inflation has made every Nigerian vastly poorer. And there is nothing positive about a pauperized population - let no one deceive you - there is no long term gain in such. It will only ever deliver death and hardship.

Finally please stop comparing the removal of subsidies in places like the UK with what has happened here. Not only are the subsidies not the same and the products being subsidized not the same, the entire picture is different. This is aside from the fact that no one was insane enough to remove 100 percent of a critical subsidy in a single day. Anyone who does that to his country is bent on destroying it.

cc nairalanda1 / kukutenla / kukutente23.

I appreciate your response and value it. I like people who argue issues intellectually not abuse because we all learn from it . The bottom line is making Nigeria better. Now ther is an important aspect of subsidy that nobody has addressed here. Part of the reason subsidy has to go is that in effect we are not just subsidizing ourselves. We are subsidizing all our West African neighbors or more. Are we Father Christmas? Can we sustain that? All those other countries are our fuel cheaply and developing over us since they are smaller and more manageable. We can't be penny wise and pounds foolish. As I speak to you, tell me any African country selling fuel at lower price than us - Ghana, SA, Egypt, Kenya, Coteviire. The effect is that we are attracting ants to ourselves for their own purpose while we think they love us. We will cry the day the fuel dries up and we have not developed alternatives. We need to be more businesslike in the way we manage our main resource. We should not waste it simply because we produce it. Like I said if we do, we will cry the day it finishes. Let our oil be like gold, let's not use it to play with anybody including our neighboring brothers

helinues:
Another Engrish

Oga, the article is for people with common sense and you are not a member of the group chat.

helinues:


Bunkum loading

Modified: As predicted early, the guy is just full of bunkum.

Coming online for almost a decade to be blaming government for everything.

May I remind you that I knew nothing about your predicament. No dey carry frustration follow me talk again , my sanity is important to me.

Again, last thank you. Outta thread

Of course, he should blame the citizens for the effect of policies made by the government. Dundee.

Dude you are blessed.

DeepSight:


My dear, look let me not waste time going through the philosophy of the matter - which I can see we will disagree on based on your posts with other people up there. I will only say that the IMF/ Bretton Woods prescriptions have been around for decades and have never worked in a single third world country. They have rather consistently destroyed lives and economies everywhere they have been implemented - so much so that it is obvious that the destruction of lives and the pauperization of populations is actually what those policies were deliberately designed for and history proves this.

As I said, let me not waste your time with arguing the philosophy of it - let me just go to the practicality. Let us assume you needed to remove subsidies, fine. No where in the world would you remove them in one fell swoop the way it was done in this country last year. That is unheard of. The spike in PMS price was over 200 per cent - and believe you me, I have researched this matter - there had never been such an increase in the price of PMS in a single day in any country in the world. Other countries which removed subsidies did so gradually over time in order to reduce the shock to the system. One does not have to be an economist to know that the ripple effects on the prices of other commodities will lead to hyper-inflation which is what has obviously happened. And there is no way that is good for the economy. If it must have been done, it should have been done in phases. Carefully managed phases.

Now as if that was not bad enough, you then proceeded to float the naira immediately at the same time. This was the biggest disaster of all. You have to understand a number of things. First is that an import dependent economy cannot afford to float or devalue its currency, That is a prescription for suicide. Because if you import everything you use, as we do, then you are spending USD all the time and if you devalue your currency then you will require more and more of your currency to procure less and less USD and that will finish you off in a vicious cycle - because the more USD you chase the more your currency will fall.

But it was not just this obvious principle that made it a disaster - what made it the greatest disaster is the fact that you are importing the said PMS you have removed subsidies from. You are paying USD for the PMS, and thus it stands to reason that once your currency falls, you will pay even more USD for that PMS and this is why the landing cost of PMS has become so high, that it is now obvious that the government is in fact still paying some subsidy to retain the price at circa N600 - because based on the exchange rate it should be over N1, 000.

Therefore by flloating the naira at the same time as removing subsidy, the FG actually defeated the purpose of subsidy removal.

The net result has been the death, destruction and unspeakable hardship which has followed. The truth is that these policies are ill thought out and they have never succeded in any third world country where they have been prescribed, and they frankly were not intended to.

Now, to adderss your question "what have we acheived through fuel subsidy since indpendence" - the answer is very simple and it is staring you in the face. Sometimes you dont know what you have until you lose it. The safety net that the economy had from this kind of devastation and hardship is what we acheived. Just compare the ecomony of a mere one and a half years ago to what obtains today and you will see the difference. That is what it is.

No economy can grow when you deflate it and take away the purchsing power of the people. Everywhere economies have grown, there has been an injection, and not a deflation. The devaluation of the naira accompanied with hyper inflation has made every Nigerian vastly poorer. And there is nothing positive about a pauperized population - let no one deceive you - there is no long term gain in such. It will only ever deliver death and hardship.

Finally please stop comparing the removal of subsidies in places like the UK with what has happened here. Not only are the subsidies not the same and the products being subsidized not the same, the entire picture is different. This is aside from the fact that no one was insane enough to remove 100 percent of a critical subsidy in a single day. Anyone who does that to his country is bent on destroying it.

cc nairalanda1 / kukutenla / kukutente23.

Max24:

I appreciate your response and value it. I like people who argue issues intellectually not abuse because we all learn from it . The bottom line is making Nigeria better. Now ther is an important aspect of subsidy that nobody has addressed here. Part of the reason subsidy has to go is that in effect we are not just subsidizing ourselves. We are subsidizing all our West African neighbors or more. Are we Father Christmas? Can we sustain that? All those other countries are our fuel cheaply and developing over us since they are smaller and more manageable. We can't be penny wise and pounds foolish. As I speak to you, tell me any African country selling fuel at lower price than us - Ghana, SA, Egypt, Kenya, Coteviire. The effect is that we are attracting ants to ourselves for their own purpose while we think they love us. We will cry the day the fuel dries up and we have not developed alternatives. We need to be more businesslike in the way we manage our main resource. We should not waste it simply because we produce it. Like I said if we do, we will cry the day it finishes. Let our oil be like gold, let's not use it to play with anybody including our neighboring brothers

Fair enough, but my issue with this argument is that it amounts to the government punishing the people for its incapacity in terms of containing smuggling. Just the way it punished the people for its inability to deal with the corruption within the subsidy system. The actual subsidy was not unbearable but it got ridiculously inflated by corruption. Rather than deal with that corruption they chose to punish the people.

Kukutenla:

It seems you do not understand what SAP is. It is not just about devaluing the currency. That's just one step. Removing subsidies and cutting government spending are also part of it. Removing import restrictions which IMF calls opening up the economy is another. Did China do all that?
NOI, Adesina, Soludo are pro-capitalist economists. Even at that, I'm surprised you're quick to claim their support. If they had spoken otherwise, I'm sure you'll have found an appropriate label for each of them. OBJ just spoke against the policies recently. I don't think you'll accept his criticism.
Tinubu obviously acted on IMF recommendations. If you have information about case studies, share and enlighten cynics like me

Obj did not speak against subsidy removal. He only said subsidy is back and that is understandable. Of course, he is right. Everybody knows that so that is not news but the subsidy is there because of the devaluation. It's left for Tinubu to manage the parameters as long as we make progress as a nation.

Max24:

Everybody knew subsidy was not sustainable and not in the long term interest of Nigeria. All past presidents without exception agreed in theory that it had to go. Even Nigerian born economists like NOI believed same. The only issue was when. Jonathan simply didn't have the political will to do it. All the same the important thing is that it is the right way to go. Is it a bed of roses? No. Painful, yes but necessary. Tinubu is just a well prepared courageous leader. He confronted the subsidy dilemma same way he confronted the states subjugation of LGAs autonomy. And you can see the instant effect in projects undertaken by LGAs in Lagos. The LGA conundrum that most past presidents including Buhari couldn't achieve Tinubu bodily achieved it and no heavens fell. Who would have believed that a Nigerian president can rule against the all powerful governors. The same govs that brought the downfall of Jonathan. That is a signal of Tinubu's doggedness and conviction. It's not by making noise. He is already restructuring Nigeria politically and economically without making noise about it. That is the Hallmark of a great leader not the submissions of a brown envelope politically exposed journalist. Lagos success remains a template for the whole country to emulate.

I don't know what you mean by everybody knew.... I don't and till tomorrow, no one will convince me that subsidies are bad when all the countries you seek to emulate have subsidies in place one way or the other including US the bastion of capitalism.
One of the funniest claims by NOI in those days was that only the rich benefit from subsidy. Well, reality has proven that to be wrong no?
Forget political will. You're just making excuses. Buhari removed and returned subsidy giving it a new name "under-recovery". Tinubu is still living in denial. So how come you single only Jonathan out as lacking political will?
Again, we're here discussing economic issues not political so forget about LGA or no LGA except you're just here to bootlick.
You can describe how the rest of the country can emulate Lagos success story

Max24:

I have been following the Harris - Waltz campaigns and that's not what they are saying and I believe those guys don't lie openly like trump. They also said trump tenure had the highest unemployment in recent times. Such videos are on YouTube.

Such gullibility to believe there are certain politicians that don't lie.
So you expect Harris to praise trump or say something positive about him.... Ok

East Asia and the Pacific region accounted for nearly half of the global total subsidy. China was the biggest subsidiser of fossil fuels, followed by the US, Russia, the European Union and India.

https://www.ft.com/content/fa607c72-7810-4ed5-98a3-d27d004c15bd

Max24:

I appreciate your response and value it. I like people who argue issues intellectually not abuse because we all learn from it . The bottom line is making Nigeria better. Now ther is an important aspect of subsidy that nobody has addressed here. Part of the reason subsidy has to go is that in effect we are not just subsidizing ourselves. We are subsidizing all our West African neighbors or more. Are we Father Christmas? Can we sustain that? All those other countries are our fuel cheaply and developing over us since they are smaller and more manageable. We can't be penny wise and pounds foolish. As I speak to you, tell me any African country selling fuel at lower price than us - Ghana, SA, Egypt, Kenya, Coteviire. The effect is that we are attracting ants to ourselves for their own purpose while we think they love us. We will cry the day the fuel dries up and we have not developed alternatives. We need to be more businesslike in the way we manage our main resource. We should not waste it simply because we produce it. Like I said if we do, we will cry the day it finishes. Let our oil be like gold, let's not use it to play with anybody including our neighboring brothers

Max24:

Obj did not speak against subsidy removal. He only said subsidy is back and that is understandable. Of course, he is right. Everybody knows that so that is not news but the subsidy is there because of the devaluation. It's left for Tinubu to manage the parameters as long as we make progress as a nation.

OBJ spoke against the policies. Go back and listen to what he said very well.
If you want the nation to make progress, you have to be honest with yourself instead of defending politicians. All I've seen from your arguments here are attempts to whitewash Tinubu and defend him even with blatant untruths and illogical assertions.
No nation can progress on a foundation of lies.

Kukutenla:

I don't know what you mean by everybody knew.... I don't and till tomorrow, no one will convince me that subsidies are bad when all the countries you seek to emulate have subsidies in place one way or the other including US the bastion of capitalism.
One of the funniest claims by NOI in those days was that only the rich benefit from subsidy. Well, reality has proven that to be wrong no?
Forget political will. You're just making excuses. Buhari removed and returned subsidy giving it a new name "under-recovery". Tinubu is still living in denial. So how come you single only Jonathan out as lacking political will?
Again, we're here discussing economic issues not political so forget about LGA or no LGA except you're just here to bootlick.
You can describe how the rest of the country can emulate Lagos success story

Good you mentioned US, a producer and buyer of fuel. Does the US subsidize it's oil too? I know US subsidies agriculture but does it subsidize fuel? What about UK? France ? Then is our govt not subsidizing agriculture in Nigeria? Are fertilizers not subsidized despite the corruption there. Tinubu has even committed himself to more food subsidy. He has ordered for tractors for mechanized farming to be distributed states. Does Lagos not subsidize education? Do Nigerian trained medical students who end up japaing abroad to work for dollars not have their tuition subsidized in Nigeria ? Many medical students would not have been able to afford medicine if they were outside the country. But my point is tell me any oil producing country that is using it's oil for subsidy - Russia, US Saudi Arabia, Angola , SA etc.