During an interview, Dr Yemi Kale, Partner and Chief Economist at KPMG Nigeria, discussed the controversial issue of fuel subsidies in Nigeria with ARISE NEWS on Monday. According to Kale, the government must take a “holistic” approach to determine the best course of action for the country, considering both the benefits and drawbacks of keeping fuel subsidies in place.
Kale stressed that eliminating subsidies could incur high costs, so would keeping them. He recommended that the government identify ways to compensate individuals impacted negatively if subsidies are eliminated. As subsidies become increasingly expensive, Kale predicts that the conversation will shift from whether to remove them to how to remove them.
Kale expressed concerns that the average Nigerian would bear the brunt of subsidies, which are now more costly than the budget allocation for infrastructure, education, and healthcare for 2023. He noted that fuel prices should rise to around 750 Naira per litre later this year.
Kale concluded by stating that a sustainable solution is necessary for the country’s benefit and that the government must balance fuel subsidies’ social and economic costs.
