The Center For The Promotion Of Private Enterprise, (CPPE), has disclosed that the high cost of transportation resulting from the subsidy removal is currently posing threats to businesses.
The Chief Executive Officer, CPPE, Dr. Muda Yusuf, said the implications of the subsidy removal is far reaching, is it resulting to inflation.
He noted that transportation costs have increased by between 20 to 50 per cent.
He reminded the government that for most citizens, transportation is critical to their survival and wage earner, small business owners, informal sector operatives, artisans and the unemployed are all very vulnerable in the current circumstances.
He therefore urged President Bola Tinubu to reciprocate the thoughtful stance of labour by speedily coming up with measures to mitigate the pains of the fuel subsidy removal.
He added, “The sufferings are real and affecting the citizens across all segments of our society – public service, private sector, informal sector, artisans, students, SMEs, the unemployed, the aged, pensioners etc. There is therefore a need for urgent responsive actions from all tiers of government. The mitigating measures should be holistic and inclusive and should be driven by a combination of direct interventions, fiscal policy measures and monetary policy actions.”
Yusuf, therefore said that this is the context in which the Government needs to urgently respond to the current crisis, focusing on the scope of impact, effective targeting, inclusion and the right messaging.
While commending the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) for opting for dialogue in resolving the impasse triggered by the fuel subsidy removal, he said government should also be sensitive about the pains the citizens are going through.
Yusuf noted, “In truth, the pains inflicted on the citizens, especially the vulnerable segments of the society, were very severe. A strike action would have further exacerbated an already difficult situation for the citizens. Opting for strike actions should only be a matter of last resort.”
He said the citizens have demonstrated an incredible understanding, tolerance, patience and resilience and as such Government cannot afford to overstretch this gesture and cannot afford to be perceived as taking them for granted.
He pointed out that reciprocity by the political leadership at all levels is urgent, exigent and crucial.
He said, “The hardship mitigating measures could be classified into immediate, short term, medium and long term. Such responses would send the right signals to citizens and demonstrate government’s sensitivity to the devastating impact of the subsidy removal on the poor.”
According to him, “Immediate panaceas need to be activated, not just with respect to transportation costs, but the surging cost of living generally. The agreement signed with labour did not reflect the desired urgency of the mitigation measures. It is also scanty on immediate actions and quick wins which are needed to immediately assuage the feelings of the ordinary citizens and stabilise the social environment.”
The CPPE also recommended to the federal government the following interventions in the interest of social justice and social stability.
Some of these measures are the acceleration of the Presidential Power Initiative to upscale power supply in the country to reduce the demand for petroleum products for purposes of electricity generation by households and businesses and ending the pricing of gas in Dollars for domestic use, especially for manufacturers.
It said: “Necessary urgent steps must be taken by government to put an end to this ‘dollarisation’ framework to ensure a moderation in energy cost for the manufacturing sector.
“Government should take urgent steps to reduce the cost of LPG to households. Recent reduction in the LPG price is laudable, but the price reduction trajectory should be sustained to ease pressure on households and prevent deforestation.”
The CPPE also advocated that import duty, VAT and other port charges on Semi Knocked Down parts for the assembly of mass transit buses should be waived.
It also called for “drastic reduction in import duty on intermediate products for food processing industry in the country. The government should engage major food processing companies to determine specific policy options for the realization of this objective. This would moderate food inflation.”
The CPPE further called for the, “abolition of all forms of taxes and import duty on renewable energy equipment to boost the adoption of renewable energy by households and SMEs. Such waivers would make renewable energy adoption affordable. This reduction should cover relevant equipment like solar panels, inverters, batteries etc. This would make citizens less reliant on the electricity grid.”
