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Posted by on Monday November 7, 2011 14:40:11:

If the Nigerian government makes true its plan to remove the subsidy on fuel, it is very likely going to have an effect on the economy as a whole. Majority of people who would be afflicted the most would be low income earners. Issues on fuel matters in the past has always had a direct effect on prices of items in the market and every sector is always affected from product to service oriented companies. Price hikes in fuel prices by previous governments had always increased the prices of items like good stuff, transportation and so on and ultimately affects the entire econoy as a whole.

A lot of Nigerians and even the Nigerian Labour Congress have already expressed their opposition to the new policy since they feel it will further impoverish Nigerians but the govt on the other hand says that subsidy was actually non existent as it has been eroded by corruption and that removing the subsidy would help deregulate the sector. However it seems that we may very well see another round of labour strike when this policy gets on the way. 2012 may very well be another year for such pressure groups to challenge Nigeria's government on its new policy.

How would the removal of fuel subsidy really affect the people of Nigeria? Well, I think it will really cause inflation in the short term but may be good for Nigeria's economy in the long term. It may cause hardship for the already poor but may also offer new opportunities for the private sector and the alternative energy providers like solar companies. Perhaps its time for us to start thinking outside the box and make our world greener by not relying entirely on crude oil products.

Subsidies are a common thing even by developed countries but I just hope that the money that will be saved by Nigeria's government would be invested in other sectors such as agriculture and infrastructure. But can we trust the government? Maybe we should give them a chance



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