The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has disclosed that the federal government’s implementation of market-based pricing for premium motor spirit (petrol) and foreign exchange has saved Nigeria approximately $20 billion or five per cent of its Gross Domestic Product as of 2 October 2024.
Edun made this known on Friday during the validation of federal civil service policies and guidelines, an event marking the first 100 days in office of the Head of Civil Service of the Federation, Mrs Esther Didi Walson-Jack, in Abuja.
He noted that the reforms introduced by President Bola Tinubu over the past 18 months had yielded significant benefits despite initial challenges, including discomfort, economic strain, and increased living costs.
“An amount of five per cent of GDP is what those two subsidies were costing,” Edun said, referring to PMS and foreign exchange subsidies.
He explained that the savings, amounting to $20 billion, could now be redirected to infrastructure, health, education, and social services.
“$20 billion of funds that could be going into infrastructure, health, social services, education. And that is what is now coming back into the government’s coffers to be able to be deployed in those areas,” he added.
Edun criticised the previous subsidy regime, describing it as a rent-seeking system that benefitted a few individuals without contributing value to the economy.
“The incentive framework has moved from one of rent-seeking, trying to make money for doing nothing to one of having real opportunities that you can use your background, your skills, your knowledge, your contacts, your relationships, and your energy to legitimately do well for yourself in a free enterprise while helping the country create jobs and to reduce poverty,” he said.
He continued, “The real change that has happened with the measures of Mr President is that nobody can wake up and their target for the day or for the week or the month or the year is to get access to cheap funding, cheap funding exchange from central bank, which they can now flip and become wealthy overnight from no value added for doing nothing virtually except you know the right people. Similarly, they can no longer try and be part of a new peak, market and very inefficient petrol subsidy regime as a way of making money overnight.”
The Minister urged Nigerians to explore incentives in sectors such as agriculture and manufacturing exports, which benefit from a weaker currency.
He commended Walson-Jack for her transformative initiatives, highlighting four key documents focusing on rewards and recognition, consequence management, mentoring, and federal secretariat protocols.
Walson-Jack stated that these policies would redefine public service delivery, making the civil service more professional, globally competitive, and responsive to the needs of Nigerians.
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