Aliko Dangote, Chairman of Dangote Group, has called on the Federal Government to halt the petrol subsidy, stating that the time is right to end the unsustainable practice. Speaking during an interview with Bloomberg TV on Monday, Dangote emphasized that subsidizing petrol leads to increased prices and unnecessary financial burdens for the government.
According to Dangote, many countries have already eliminated subsidies, and Nigeria should follow suit. “I think it is the right time to remove the subsidy because all countries have gotten rid of it,” he said. Dangote added that the government is “paying what they are not supposed to be paying” by continuing with the subsidy.
Dangote’s comments come as his refinery begins local production, which he says will help track and account for Nigeria’s actual fuel consumption. “This refinery will reveal the real consumption of Nigeria,” he noted, highlighting the varying estimates of daily petrol consumption, which range from 60 million litres to less.
To combat fuel smuggling and ensure accountability, Dangote plans to implement tracking systems for trucks and ships loading from his refinery. “We will put trackers on them to ensure the oil remains within Nigeria, helping the government save a lot of money,” he explained.
Dangote also pointed out the illogical nature of Nigeria’s current fuel prices. “Gasoline is about 40% cheaper in Nigeria than in Saudi Arabia, which makes no sense. It’s not sustainable,” he said, referencing Nigeria’s porous borders and significantly lower fuel prices compared to neighboring countries.
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The billionaire businessman stressed that the decision to remove the petrol subsidy ultimately lies with the government. “We are a private company, and we have to make a profit. The removal of the subsidy is dependent on the government, not us,” he remarked, noting that his $20 billion refinery must operate profitably.
President Bola Tinubu had previously declared an end to the petrol subsidy regime on May 29, 2023, but Dangote’s latest comments add urgency to the issue, as he reiterated that the subsidy will eventually have to go.
Dangote’s call aligns with the growing sentiment that Nigeria’s petrol subsidy is no longer sustainable. The country has spent billions on fuel subsidies, money that could be better allocated to critical infrastructure, healthcare, and education. By tracking fuel consumption and preventing smuggling, the government can save massive amounts of money and improve its economic stability.
Ending the subsidy would also level the playing field, making Nigeria’s petrol prices more competitive with those of neighboring countries. This, in turn, could attract more investment into the energy sector, spurring economic growth.
