$20bn saved since removal of subsidies, says Finance minister
At least $20 billion was saved by the removal of the fuel subsidy and adoption of market-based foreign exchange pricing, the federal government has said.
Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, while disclosing this at an event in Abuja marking the first 100 days in office of Esther Walso-Jack, Head of the Civil Service of the Federation, said that the two subsidies were costing the country five per cent of the Gross Domestic Product, GDP.
He said, “When there was a subsidy on PMS and on foreign exchange, they collectively cost five per cent of GDP. Assuming GDP was $400 billion on average, five percent of that is $20 billion — funds that could now go into infrastructure, health, social services, and education.”
The minister further noted that the savings are being redirected into developmental projects.
“The real change is that no one can wake up and target cheap funding or forex from the Central Bank to enrich themselves without adding value.
“Similarly, profiteering from the inefficient petrol subsidy regime is no longer possible,” he added.
