By Lateef Adegbite and Sleiman Umaru
President Bola Ahmed, appears to have taken advantage of the recent state visit to the Asian country of China, on the invitation of Xi Jinping, the country’s Leader to open up why the Federal Government jerked up the pump price of Premium Motor Spirit, PMS, popular, petrol, in Nigeria.
It had started as a rumour that the Nigerian President, has thrown his weight behind Mele Kolo Kyari, Group Managing Director,GMD, Nigerian National Petroleum Corporation, now baptized Nigerian National Petroleum Company, Limited, NNPCL, with the passage of the Petroleum Industry Bill, PIB, by the National Assembly and signed into Law by former President Muhammadu Buhari Buhari, on August ,2020, and the Nigerian Midstream and Downstream petroleum Regulatory Authority, NMDPRA, to increase the pump price of petrol because of the losses incurred in the sales of the product believed to be below the International market price.
The Nigerian President who had concluded his official visit to China, on Friday, September 6, 2024, by meeting with Nigerians, living and doing business in the industrialized Asian country had said that the increase in the pump price of petrol in Nigeria was because of the tough decisions that had been taken by the Administration, which has to do with removal of petrol subsidy on May 29, 2023 and the unification of the official and parallel, popular, black market exchange rates in the country’s foreign exchange market.
The Nigerian President who had said that’’ it is something that ’’the government cannot help’’ was said to have made it clear to the Nigerian Community in China that there is no way the government can develop good roads like the ones seen in China and other parts of the country or enjoy uninterrupted power supply if the government continues to subsidize the price of petrol in the country.
He was said to have told Nigerians in China, who had piled up pressure on him to reverse the pump price of petrol to the original rate that it is not possible as it is now market regulated. The former Lagos state governor in apparent response to questions asked him during a meeting with the Nigerian Community in Beijing, Capital of China, was said to have made the people to understand that these basic amenities they are currently enjoying in China such as good roads, electricity, portable water supply, and good schools, among others could be made available in Nigeria through’’ sacrifice from the citizens’’.
The Nigerian leader who had admitted that the citizenry are going through hard times as the sudden hike in the pump price of petrol has greatly affected economic activities, had said that ‘’ transport fare has gone up uncontrollably’’. He had told Nigerians in Diaspora that the economic reforms that had been embarked upon by his Administration are needed because ‘’Nigeria genuine hopes to grow like China, North American country of the United States, US,, Britain, France, Germany, Netherland, Japan and other developed economies, insisting that ‘’Nigerians must endure the hardship’’.
Signs that the Tinubu’s Administration, which had promised to continue the good works of Buhari, the immediate past Nigerian President by hastily removing the subsidy on petrol without doing his homework may have returned it through the backdoor.
Former President Obasano , may have shocked Nigerians when said during an interview with Financial Times , a foreign Tabloid, last March, that the petrol subsidy abolished by President Tinubu in his inaugural speech on May 29, 2023, but challenged by the World Bank and IMF, is back.
He may have alluded to what the World Bank and IMF, had said in a statement in February 9, 2024, that the Tinubu’s Administration which had removed subsidy on petrol on assumption of office on May 29, 2023, had’’ capped retail the prices , thus partially reversing the fuel subsidy removal’’.
Axel Schimmlpfennig, IMF, Chief in Nigeria, who has never hidden the global lender mission in Nigeria and its stance against resumed subsidies was said to have put the Tinubu’s Administration under intense pressure over the last one year. The World Bank/IMF, Chief, was said to have made it clear to the Nigerian Governmant that the capping of the pump price of petrol below cost recovery could have a fiscal cost of up 3 % of the country’s GDP, in this 2024, Fiscal year, if not reversed.
The global Lender was said to have enjoined the government to prioritize cash transfers to households from diaspora over the battle against smuggling of fuel across the nation’s border Communities. The IMF, had revealed that fuel subsidies , accounted for 2% of the country’s GDP, in 2022 and US $10 billion, during the Buhari’s Administration ,a level that was said o have been slashed to 0.9% in 2023 , after the policy was abandoned by President Tinubu.
Kyari, the NNPCL boss had said that the company could no longer sell the pump price of petrol below the international market rate because the offshore refineries which had been obliging it over the years by supplying the product on credit whenever requested are no longer enthusiastic to do so because of piling debts and the global downturn in the economy.
The NNPCL, which solely imports PMS, from the offshore refineries for sale to the major and Independent Petroleum Products marketers, who in turn sells to Nigerians, had justified why the pump price of petrol must be jerked up, noting that the pump price of petrol in the neighbouring West African countries of Benin, Niger, and the other West African countries including the Central African country of Cameroun, was over N1,700.00, as against the N600.00, sold in the Nigerian market.
The NPCL, GMD, had said that the lower pump price of petrol in Nigeria, is what what currently encourages smuggling of the product ,from Nigeria porous borders to theseeighbouring countries, which had apparently weighed it with a boggling debt of US 6 billion , which had not been settled over time to the foreign Petrol suppliers.
The NNPCL , Authorities may have to have drummed it to the hearings of the president that ‘’the activities of the unscrupulous marketers had remained a major concern to as such’’ diversion and smuggling across across the country’s land borders has continued unabated’’.
According to Kyari, the NNPCL, GMD, available records to the company showed that that ‘’there has been an upsurge in incidents of petrol smuggling across Nigerian borders in recent months’’ , which is incentivized by high rate of arbitrage, especially considering the high price of petrol in these countries.
Indeed, the Presidential nod to NNPCL, increase the pump price of petrol may have encouraged the Company to jerk it from N568.00 to N855.00, N897.00, depending on the location, as a way to discouraging the smuggling of the product across the border, which many believe had made nonsense of the country’s N70,000.00 minimum wage, which cannot even buy a bag of 50Kg local or foreign par boiled rice.
Given NNPCL, claims that the Federal Operations Units, FOU, and other Customs Interventionist Units, are not effectively policing the border communities as it ought to be done to stop the smuggling of petrol across the border may have informed why the Nigerian Customs Service,under the close watch of Bashir Adewale Adeniyi, had set up the Operations whirwind under the close watch of Compt. Hussein Kehinde Ejibunu, who was said to have given smugglers of Contraband goods a battle of their life at FOU, Zone A, Ikeja, Laos, the nation’s Commercial neve centre.
The Value News online Magazine findings shows that the petrol smugglers , may have found it difficult to operate in the south western state of Ogun, which had over 90 illegal routes used to smuggle the product to Republic of Benin , and.This is because of the hardline position adopted by Compt. Amadou Shuaibu, then Area Controller , Ogun I, Command , Idiroko, now deployed to FOU, Zone B, Kaduna, the 13 states overseeing the north western and central geopolitical regionsincluding Abuja, the Federal Capital Territory, FCT.
There is no gain saying the fact that the north western states of Sokoto, Zamfara, Kebbi, Kaduna, Katsina, and the north central states of Niger andKwara, shares boundaries, with Niger and Benin Republic, either by Land or through the Creeks, which provides easy access for the petrol smugglers to carry out their nefarious activities with the support of the Bandits Group fighters.
Worried by the upsurge of smuggling of petrol from Nigeria to Benin Republic, Niger and Central African country of Cameroun, may have informed why NCS, NNPCL and, NMDPRA, had taken the bold initiative to set up a Joint Committee to checkmate the activities of the petrol smugglers across the nation’s border Communities in 2019, but that was how far they could go.
The inability of Hameed Ali, a retired Army Colonel and then Comptroller General of NCS, Kyari, NNPCL , GMD, and their Counterpart in NMDPRA, to go ahead with implement the agreement to set up the Joint Committee to checkmate the activities of the petrol smugglers may have given room to Barshir Adewale Adenuiyi, MFR, the incumbent Cmptroller General of Customs,who was are of the agreement to set up Operation whirwind, which is doing a great job as it is making seizures thousands of errycans of petrol of 25 litres each in different border Communiities across the country , except the north western , north central and south western state of Oyo border Communities.
The Operation whirlwind officers may have found it difficult to penetrate the two northern regions superintended by Compt. huaibu , who security experts believe had done his homework before coming out with his war chest on how to deal decisively with the smugglers including the petrol smugglers.
The FOU, Zone B, Kaduna, Patrol Team officers, who appears to be acting out a script, may have made the Operation Whirlwind officers, redundant at the Land border stations in the north western and north central border Communities as they were said to have effectively blocked all the illegal routes used by the smugglers with the support of the people who gives out information freely.
The situation is not different from the Oyo/Osun border Communities, where Compt. Nkem Ben Oramalogu, has made it a no go area for petrol smugglers and their sponsors both in Nigeria and Benin Repu
