President Muhammadu Buhari has sent a letter to the Senate seeking approval to take a loan to the tune of $800 million from the World Bank to cushion the effects of subsidy removal.
This follows the Federal Government’s April announcement of an $800 million World Bank grant targeting 50 million vulnerable Nigerians or 10 million households, as part of its subsidy palliatives measures.
According to the Minister of Finance, Budget and National Planning, Zainab Ahmed, the disbursement of the grant is in light of the planned subsidy removal in June 2023.
Ahmed underscored that engagements are ongoing with the newly established Presidential Transition Council (PTC) and the incoming administration, to drive the palliative program, which includes the need for buses among various considerations.
In light of the World Bank loan request, a non-governmental organisation, the Civil Society Legislative Advocacy Centre (CISLAC) on Friday lamented what he described as the nonchalant attitude displayed by the Buhari administration towards the country’s crippling debt crisis.
The Executive Director of CISLAC, Auwal Musa-Rafsanjani, queried the Federal Government over the loan request, adding that borrowing to fund post-fuel subsidy removal palliatives is strange.
He wondered “if the fuel subsidy removal process has been suspended as announced by the Minister of Finance after the NEC meeting at the end of April, then the government should return the borrowed money because what are we taking the loan for?”
Rafsanjani argued that fears of the country getting another $800 million loan from the World Bank sends waves of worries in the minds of Nigerians as Nigeria’s revenue collection in 2022 stood at N10 trillion, with a debt of about N77 trillion.
The National Economic Council (NEC) on April 27 suspended the planned removal of subsidy on petroleum products by the end of the Buhari administration.
The NEC comprises the 36 state governors, the Governor of the Central Bank of Nigeria (CBN), and other co-opted government officials.
The finance minister, who announced the decision, stated that the council concluded in its recently concluded meeting that it was not a favourable time for the action.
According to her, the NEC deliberated on the matter and resolved that it cannot be removed for now.
She added that it equally agreed on the need to continue the discussion on the matter and the necessary preparatory work in conjunction with states and representatives of the incoming administration.