Africa’s richest person and the President of the Dangote Group, Aliko Dangote, has said that the Nigerian government can remove fuel subsidy if it wants to, as Nigerians will adjust to the market pricing of petrol in the country.
Dangote said this in an interview with Bloomberg on Monday, where he was explaining the earlier disparities between the Dangote Refinery and the Nigerian National Petroleum Company Limited (NNPCL) in the pricing of the refined petrol coming from the Dangote Refinery, of which the NNPC is said to be the sole offtaker.
Dangote explained, “It wasn’t really a disagreement per say. NNPC bought from us- this particular one on 15th of September, at the international price, which they also bought about over 800,000 metric tonnes of gasoline imported. So, the one that they bought from us actually is cheaper than the one that they are importing, and so, when we announced our price, the guy (an NNPC spokesperson), I don’t know whether he was authorised or not, but it wasn’t really the real price.
“What they have announced, yes, most likely that’s what it cost them, including profit, including whatever you know, which they have never added profit to their cost. And then the other one is the one that they imported, but the people don’t know how much they spent in terms of the import, but their own importation one is maybe 15 to 20 per cent more expensive than ours. So, what they’re supposed to do is sell at a basket price, or if they want to remove subsidy, they can announce that they’ve removed subsidy, which is okay, everybody will adjust to it.”
Still speaking on the issue of subsidy, Dangote said, “Subsidy is a very sensitive issue. I believe the problem is not only the subsidy- you know, when you are subsidising something, then people will be blotting the numbers, and government will end up paying what they’re not supposed to be paying. But this our refinery will bring quite a lot of issues out there.
“You know, it will show the real consumption of Nigeria, because nobody can tell you- some say 60 million litres of gasoline per day, some say no, it’s less. But right now, if you look at it, by us producing, everything can be counted, so everything can be accounted for. And most of the trucks or ships that will come and load from us, we’re going to actually put a tracker on them to be sure we’re going to take the oil within Nigeria, and that, I think, can help the government to save quite a lot of money.”
The billionaire businessman was then asked if he believes it is time that Nigeria got rid of fuel subsidy, to which he replied, “I think it is, you know, because all countries have actually gotten rid of subsidies. Let me give you an example. Saudi Arabia used to give- what Saudi’s, the citizens believed, that look, oil is our own God given gift, so the government shouldn’t charge us for it. So, government was selling it at a very low price, but today as we speak, gasoline is about 40% cheaper in Nigeria than in Saudi Arabia, which I think it doesn’t make sense, that is one.
“Number two, our price of gasoline is about 60 per cent of the price of our neighbouring countries, and we have very porous borders. So, it is not sustainable. I mean, the amount of subsidies that we’re paying, government cannot afford those subsidies.”
Ozioma Samuel-Ugwuezi
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