The World Bank has projected President Bola Tinubu’s government to save at least N2 trillion in 2023 and N11 trillion by 2025 from fuel subsidy removal.
“With the petrol subsidy removal, the government is projected to achieve fiscal savings of approximately N2 trillion in 2023, equivalent to 0.9% of GDP. These savings are expected to reach over N11 trillion by the end of 2025,” the World Bank said.
The global financial institution disclosed this in its June edition of the ‘Nigeria Development Update (NDU)’ report.
Though the World Bank projected that at least N13 trillion would be saved from subsidy reform in three years, it stressed that “compensating transfers will be essential to help shield the most vulnerable Nigerian households from the initial price impacts of the subsidy reform.”
The Washington-based financial institution added, “Without compensation, many households could be pushed into poverty by higher petrol prices and have to resort to coping mechanisms with long-term adverse consequences.”
Mr Tinubu assumed office on May 29, announcing the immediate removal of the petrol subsidy, which saw the petrol pump price skyrocket to N540 from N195. However, the president did not mention plans to cushion the adverse effects on the Nigerian masses.