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Thursday, August 3, 2023

Tinubu’s subsidy removal, forex unification will bring Nigeria economic prosperity: UK

“I am keen on encouraging more UK investments into Nigeria. You took bold and important decisions so far that will reform your economy.”

• August 3, 2023
James Cleverly
James Cleverly [Credit: BBC]

The British government has lauded President Bola Tinubu for unifying the forex market and removing the petrol subsidy, adding that the policies will facilitate economic prosperity for Nigeria.

In a statement by the president’s media aide Ajuri Ngelale, the UK Secretary of Foreign, Commonwealth and Development Affairs, James Cleverly, at a meeting with Mr Tinubu at the State House on Wednesday, said the policies would contribute to Nigeria’s prosperity despite initial hardships.

“I want to commend you for the decisions you have taken to reform your economy,” Mr Cleverly said. “Your economic reforms are bold and the actions taken have been decisive. Despite the initial pains these decisions will lead to economic prosperity for Nigerians.”

Mr Cleverly further assured Nigeria of the UK’s interest in investing in its economy, adding that “with their energy and talents along with your resources, Nigeria can be a net exporter of energy and agricultural products.”

“I am keen on encouraging more UK investments into Nigeria. You took bold and important decisions so far that will reform your economy and open it more for foreign investments. Nigeria has a population of very young, educated and thoughtful people. The UK will remain a strategic long-term and multi-decades partner of Nigeria and Africa,” he said.

Mr Tinubu assumed office on May 29, declaring an immediate end to the petrol subsidy.

“Subsidy is gone,” Mr Tinubu said in his inaugural speech, a development which saw fuel price skyrocket from N195 to over N600.

A week after he assumed office, he also ordered the Central Bank of Nigeria to float the naira, allowing banks to determine exchange rates to the dollar and other foreign currencies.

Though adjudged to be good for the economy, the dual policies have triggered untold hardships across the country as prices of food and transportation hit the roof.

Mr Tinubu’s regime is projected to save at least N13 trillion from the subsidy reform in three years.

But the World Bank said, “Compensating transfers will be essential to help shield the most vulnerable Nigerian households from the initial price impacts of the subsidy reform,” noting that “without compensation, many households could be pushed into poverty by higher petrol prices and have to resort to coping mechanisms with long-term adverse consequences.”

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