Following the recent increase in petrol prices approved by Nigeria National Petroleum Company Limited (NNPCL), development economist Mohammed Nezifi has warned that the government may face demands for higher wages or subsidies. Speaking with the News Agency of Nigeria (NAN) in Abuja, Nezifi explained that the petrol price hike could widen fiscal deficits and public debt, as workers are likely to push for wage increases to cope with rising costs.
On September 3, NNPCL raised the petrol pump price from N568-N617 per litre to N897 per litre. Nezifi pointed out that this increase disproportionately affects lower-income households, who spend more of their income on transportation and food, potentially increasing poverty and worsening inequality.
Nezifi suggested that government intervention, such as subsidies or welfare programmes, could help alleviate the burden but warned of the financial strain this would place on public finances. He also cautioned that the economic hardship could lead to social unrest, including protests or strikes, which could destabilise economic activities.
Another economist, David Ambi, recommended the government foster a more competitive market environment by reintroducing targeted subsidies and social safety nets. Aligning policies with economic principles that promote efficiency and consumer protection could help stabilise the economy and improve living standards.
Credit: NAN (Text Excluding Headline)
