We will implement subsidy removal gradually, says Zainab Ahmed

* …World Bank to assist in managing Nigeria’s $24.39b
debt

Zainab Ahmed, the minister of finance, says the federal
government will implement fuel subsidy removal gradually.

Addressing the press on the sidelines of the ongoing spring
meetings of the International Monetary Fund and World Bank Group,
Ahmed said fuel subsidy cannot be removed at once.

In her address on Thursday, Christine Lagarde had advised
Nigeria and other countries to remove fuel subsidy saying the money
spent on subsidy can be redirected to health and education.

“The advice from the IMF on fuel subsidy removal was good advice
but also we have to implement it in a manner that is both
successful and sustainable. We are not in a situation to wake up
one day and just remove subsidy,” she told journalists.

“We have to educate the people, we have to show Nigerians what
the replacement for those subsidies will be so we have a lot of
work to do.

“We also need to understand that you don’t remove large amounts
of subsidy in one go, it has to be graduated and the public has to
be well-informed on what you are trying to do.”

The minister said the minister met with the IMF and have
reviewed the IMF Article IV Consultation with Nigeria report, which
was positive. “The review was a positive one and had good advice
from the IMF to Nigeria and they have indicated that they are
available to provide technical support to improve our liquidity
management, our debt management and other fiscal measures,” she
said.

Data from the Debt Management Office (DMO) showed that Nigeria’s
total public debt rose to N24.39 trillion or $79.44 billion as at
December 31, 2018 representing a year-on-year growth of 12.25 per
cent. The 2018 debt stock is higher than that of 2017 by N2.662
billion.

Mrs. Ahmed said President Muhammadu Buhari has directed that the
minister looks at every area that requires reforms.

Speaking on the Sovereign Wealth Fund (SWF) operations, she
said: “I would say that the Sovereign Wealth Authority has been
doing well if you look at where we are starting from, we have
achieved quite a lot of progress by building more of the fund from
where we met it and by utilising the savings at the Sovereign
Wealth Authority for projects that are physically visible. We still
have some movements to go but the movement is a positive one”.

The minister said the Federal government has asked the World
Bank to review some of the initiatives that it has put in place,
including those that involve them looking at implementation systems
on areas they are providing funding for infrastructure.

“What we found in Nigeria is that the Environmental and Social
Standards (ESS) put in place by the World Bank is causing
significant delays in the rollout of infrastructure. We understand
that it is well intended but we have informed them that they need
to review how they implement it so that we are not overtly slowed
down because of the new proceedings,” she said.