The Independent Petroleum Marketers Association of Nigeria (lPMAN), says subsidy on Premium Motor Spirit, popularly known as petrol, is no longer sustainable.
The National Operations Controller of lPMAN- Mr. Mike Osatuyi, in an interview with journalists today in Lagos, condemned payment of subsidy on petrol.
Osatuyi said this against the backdrop of the ongoing hike in the pump price of petrol in filling stations across the country. He said the federal government had 20.51 trillion naira expenditure in the 2023 budget against revenue of 9.7 trillion naira, leaving a deficit of about 10.78 trillion naira.
Osatuyi said the government hoped to finance subsidy on petrol up to June 2023 at a cost of 3.6 trillion naira, using Central Bank of Nigeria (CBN) official rate of 435 to a dollar; adding that the subsidy regime had led to increase in budget deficit and caused borrowing setbacks to the economy.
According to Osatuyi, subsidy makes smuggling of petrol a striving business because of the huge profit involved. He however, urged the government to put all necessary measures in place to cushion the negative effects of the increase in price of petrol before removing subsidy.
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