Nigerian President Muhammadu Buhari’s sudden hesitance to remove fuel subsidies may be a pointer to internal divisions within his broad APC coalition, as to the direction of economic policy, BusinessDay reports.
Investors had hoped that the new government’s quick movement on ending the regressive and corruption laden subsidies would be a signal of their intention to pursue structural reforms that have crimped growth in Africa’s largest economy.
President Muhammadu Buhari had said in April, (when still president-elect) that he would end fuel subsidies and the oil and gas sector would be reformed as a matter of priority in order to attract new investments. This was largely based on the input by the Oil and Gas sub-committee of the President’s transition committee, which outlined steps for the government to take in the first 100 days, including removing subsidies on petrol and kerosene.
However Buhari was recently quoted by Garba Shehu, the president’s Senior Special Assistant, Media and Publicity, as saying, “I have received much literature on the need to remove subsidies, but much of it has no depth.”
“Policy differences between the commercially – minded southwest and the northern parts of the party may lead to policy volatility,” said Control Risks, a global business risk consultancy, in a June 25 presentation. This may impact on the Buhari government’s grip on policy making and legislative agenda, according to the firm.