The World Bank has urged the Nigerian Government to end its fuel subsidy regime within the next six months (April 2022).
Naija News reports the federal government has spent at least $2.1 billion (about N864 billion at N410 per $) on fuel subsidies in the first nine months of 2021.
It is understood that the World Bank’s appeal is coming days after the International Monetary Fund (IMF) had asked Nigeria to cut off oil and electricity subsidies by early 2022.
After its official visit to Nigeria, the IMF said the removal of oil and electricity subsidies should be a top priority for the country as part of the financial system.
A report released by the World Bank on Tuesday said that the removal of the fuel subsidy would benefit the poorest Nigeria, saying that the rich benefitted more from the practice.
The global lender asked the government to come up with good reforms that would minimize the impact of the removal of the fuel subsidy on the lives of the poor and contribute more to the growth of the country.
The World Bank stated that 40% of low-income earners in Nigeria consume less than 3% of the total available Premium Motor Spirit in the country.
“Urgent priorities for the next three to six months include reducing inflation, improving exchange-rate management…eliminating the PMS subsidy…and improving infrastructure,” the report said in part.