Fuel Subsidy Removal: Tinubu’s Plans To Tackle Food Inflation, Shortage

President Bola Tinubu, during his inauguration on May 29, 2023, at Eagle Square in Abuja, announced that the era of subsidy payment on fuel has ended.

Reading his inaugural speech, the President said the fuel subsidy is not captured in the 2023 budget, so there is no reason to continue to pay subsidies on petrol.

President Tinubu stated his government would channel the funds saved from the decade-long subsidy on petroleum products towards public infrastructure and improving the lives of the Nigerian people. However, his declaration of fuel subsidy removal has led to a debilitating negative effect on citizens both in the urban and rural areas.

Some of the effects of subsidy removal include increased transportation costs due to high fuel prices, food inflation, food insecurity, and poverty.

The effect of fuel subsidy removal has directly impacted food production in the country, and Nigerians will not survive without having food to eat if there is a food shortage or inflation.

The high transportation cost has heightened food insecurity in the country as consumers struggle to purchase daily meals at increased prices.

State Of Emergency Declaration On Food Security

However, in order to address food inflation and shortage across the 36 states and the Federal Capital Territory (FCT), President Tinubu, after a meeting with stakeholders in agriculture and food production value-chain at the State House, Abuja, on July 13, declared a state of emergency on food security in the nation.

The President, through his Special Adviser on Special Duties, Communication and Strategy, Dele Alake, enumerated his administration’s action plan on food security, food pricing and sustainability.

According to Alake, the measures in the action plan would include an immediate release of fertilizers and grains to farmers and households to mitigate the effects of the subsidy removal.⁣

On steps to be taken to give effect to the President’s order, Alake stated that a number of initiatives would be deployed in the immediate, medium and long terms, adding that goals to be achieved have been marked.

Alake listed the steps to include all-year-round farming, the creation of special purpose vehicles, like the commodity board, to liberalize the food production value chain, the immediate activation of land banks across the country, as well as putting an end to age-long nomadic animal husbandry, replaced with government managed ranching.

The presidential aide said that the current administration would engage the nation’s security architecture to protect the farms and the farmers so that they can return to the farmlands without fear of attacks. He noted that the government would also collaborate with mechanization companies to clear more forests and make them available for farming.

Tinubu’s government also promised to put the eleven rivers basins to use to ensure the planting of crops during the dry season with irrigation schemes that will guarantee continuous farming production all year round, to stem the seasonal glut and scarcity.

Alake added that the current administration would deploy concessionary capital to the sector, especially towards fertilizer, processing, mechanization, seeds, chemicals, equipment, feed, and labour, among others.

The presidential aide stated that the targeted gains of the emergency declaration on food production and distribution would include increased job creation, food abundance and security.

In order to cushion the effect of food shortages across the country, the National Economic Council (NEC), at its last meeting on August 17, approved the sum of 5 billion naira to be given to each state for the procurement of 100,000 bags of rice, 40,000 bags of maize and fertilizers.

Food Security Plan A Good Idea But…

In an exclusive interview with Naija News, a lecturer at the Federal University of Agriculture, Abeokuta (FUNNAB), Dr Gbemisola Otusanya, said the President’s food security plan is a good idea that must be effectively implemented.

Otusanya, who is a Doctor of Plant Breeding and Animal Science, stated that the Nigerian government must invest more in the agricultural sector and increase its national budget for agriculture to ensure food security in the country.

She added that Tinubu’s administration must invest more in improving agricultural infrastructures and subsidising inputs like seedlings and fertilisers to counter the effects of the fuel subsidy removal.

She said: “The Nigerian government must invest more in the agricultural sector to ensure food security. A Food and Agriculture Organization report indicates that the Nigerian government allocates less than 10 per cent of its national budget to the agricultural sector. The meagre budget allocation is inadequate to counteract the effects of the fuel subsidy removal on agricultural productivity.

“Therefore, given the current subsidy removal, Nigeria must aim to increase budgetary allocation to the agricultural sector. The investment should go into improving agricultural infrastructures and subsidising inputs like seedlings and fertilisers. Such agricultural subsidies can reduce the burden on farmers and help keep the cost of production affordable. In this way, Nigeria can minimise the effects of the fuel subsidy removal on agricultural productivity.“