Nigerian Economic Summit Group (NESG) has expressed concern over the federal government’s failure to extend the crude-for-naira deal, warning that the move could undermine the incentives that enabled local refining success, particularly by the Dangote Refinery.
At a media engagement in Abuja yesterday, NESG chief executive officer, Dr. Tayo Aduloju, said the suspension of the crude-for-naira arrangement could derail the progress made in reducing petroleum product prices and easing foreign exchange (FX) demand pressures.
“We want to encourage the regulator. We know it’s hard work, and none of this is as easy as it sounds. But in working together with the market, it’s important that we do not kill the incentives that allowed Dangote to achieve what it has done for us,” Aduloju stated.
He highlighted the historic reduction in petrol prices for locally refined products, emphasizing that such achievements were once considered unattainable. “If somebody had told us a few years ago that locally produced petrol could be sold at such a price, we would have dismissed it outright. But now, we have achieved it,” he said.
Aduloju described the government’s move as a setback, urging all stakeholders to collaborate in finding a better alternative that serves Nigeria’s economic interests. “This is not a good development. We should all work together to find a better option that works for Nigeria. In the end, it was Nigerians that were promised these reforms would create a more enabling environment. When it becomes difficult, it almost looks like we forgot what we promised. And that’s not good for the government or the people,” he added.
On the recent announcement by the Nigerian National Petroleum Company Limited (NNPCL) to list on the capital market, Aduloju expressed strong support. “The decision to list on the capital market is very welcomed. I hope they go all the way with it,” he said.
He explained that the NESG supported the crude-for-naira deal due to its potential to lower domestic fuel costs and ease FX pressures, provided it did not introduce another form of FX subsidy. “The policy was good because it lifted the burden on FX demand, allowed transactions to be costed in naira, and had the potential for downward trending of petrol prices in the local market,” he noted.
However, he cautioned that the current direction of the policy was not beneficial. “That journey is going nowhere; it’s doing no one any good. We encourage the committee to revisit the broad framework. We know there are losers, but a sustainable balance must be found,” he urged.
Aduloju also called on authorities to accelerate economic value addition to achieve real transformation. He pointed out that despite rising national revenue and population, growth remains sluggish. “There appears to be a balance of issues making it difficult for higher national income to translate into real growth,” he observed.
He further urged the government to onboard the $5 billion trade facility recently announced by the minister of Industry, Trade, and Investment, and emphasised the need for political stability in Rivers State to achieve Nigeria’s oil production target of 2.2 million barrels per day.
“There must be a trade-off between fiscal and monetary policies. A reduction in the multiplicity of taxes will enhance the ease of doing business,” he added, stressing that productivity efficiency and job creation must remain top priorities for national economic growth.
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