NewStats: 3,263,828 , 8,181,530 topics. Date: Sunday, 08 June 2025 at 07:13 AM 2t5y6f

nairalanda1:

Rafael, do not give in to the anger...

nairalanda1:

The reason why I oppose subsidy is simple. TO pay for subsidy for petrol for this year, so that it can cost N200....it would have cost our budget something like 17-20 trillion naira.

(And note that it won't stop smuggling. Every country I know that has a subsidy has smuggling...that means millions of losses.)

So, imagine spending 17 trilluion even something like 12 trillion...which was the estimated cost of subsidy for 2023, assuming PIA did not take effect.....that means a huge hole is in our budget...which would be filled with loans.

Add the fact that by August 2022, we were spending 90% of our revenue on loans and more loans payment. Revenue for next year's budget.

how did you come about these figures you have shared above?

is it fuel subsidy that is responsible for smuggling?

lexy2014:




how did you come about these figures you have shared above?

is it fuel subsidy that is responsible for smuggling?

Thank you

lexy2014:




how did you come about these figures you have shared above?

is it fuel subsidy that is responsible for smuggling?

Mr Question Man. Why? How? Is the sky blue?

Is that the question I asked you?



Nairalander gave you an excellent answer.

nairalanda1:


Thank you

Ignorance needs no explanation.

Good Luck to Nigeria.

IbeOkehie:


Mr Question Man. Why? How? Is the sky blue?

Is that the question I asked you?



Nairalander gave you an excellent answer.



Ignorance needs no explanation.

Good Luck to Nigeria.

if ignorance needs no explanation, why then is it ignorance and what then is the purpose of explanation?

Tianamen1:
Nairalanda1, try to read this post slowly, do a little research so your understanding of recent economic events in Nigeria will improve.

The US dollar is the global reserve currency. US interest rate policies affect the values of currencies globally. When the United States raises interest rates, investors across the world buy US bonds. This lifts the value of the dollar against other currencies. When US interest rates fall the opposite (usually) happens.

Norway has the largest sovereign wealth fund of any country yet its Krone lost value when the US started raising interest rates in 2022.

Now to subsidies. Subsidies in Nigeria exist because of the federal government’s poor management of our macroeconomy which leads to the severe collapse of the Naira when US interest rates are being raised.

As Tinubu started his tenure in mid 2023, he should have borrowed money to fight for a stable Naira until the US stopped raising interest rates. He should have closed the gab between the official and the black market rates but he shouldn’t have allowed the Naira to fall as badly as it has.

I read the post carefully. While you have some good points, you missed some important ones

As far back as 2013, Mr Tinubu had campaigned for a massive increase in money supply as a major solution to the economic problems of Nigeria. He wrote at least 2 major policy papers urging the government to engage in "counter cyclical" stimulus. I've repeatedly cited them on Nairaland.

The then Finance Minister Ngozi Iweala felt constrained or concerned enough to PUBLISH an official rejection of the recommendation. It was a big deal at the time, it was a debate played out in ALL major newspapers.

It's no surprise that when APC won the Presidency in 2015, Mr Buhari implemented the profligate Ways & Means policies. As a practical matter the money was needed to pay for all the socialist programs that the party has promised for Nigerians, including LOW FUEL PRICES.

The biggest contributor to the loss of naira value was the massive printing and borrowing of currency. This has been officially acknowledged. There's really no debate about it, though we know that there's OTHER MINOR factors.

Have a good day.

Good Luck to Nigeria.

IbeOkehie:


I read the post carefully. While you have some excellent points, you missed some important ones

As far back as 2013, Mr Tinubu campaigned for a massive increase in the money supply as a major solution to Nigeria's economic problems. He wrote at least two major policy papers urging the government to engage in "counter-cyclical" stimulus. I've repeatedly cited them on Nairaland.

The then Finance Minister Ngozi Iweala felt pressure to PUBLISH an official rejection of the recommendation, which was a big deal at the time.

Unsurprisingly, when APC won the Presidency in 2015, Mr Buhari implemented the profligate Ways & Means policies. As a practical matter, the money was needed to pay for all the socialist programs that the party promised Nigerians, including LOW FUEL PRICES.

The massive printing and borrowing of currency was the most significant contributor to the loss of naira value. This has been officially acknowledged. There's no debate, though we know there are OTHER MINOR factors.

Have a good day.

Good Luck to Nigeria.

Both Buhari and Tinubu have been horrible at managing Nigeria’s economy. I will never argue against this.
Understanding how a sovereign wealth fund stabilises an economy is necessary, for you know why I blame GEJ above anyone else. I will attach a YouTube video to this post.

In simple , a sovereign wealth fund is like a diet. It forces you to eat less than you can, which results in suboptimal growth. Even when you produce less food, you can still maintain your previous level of consumption without having to borrow much.

Buhari had to implement tough reforms or borrow money because Nigeria ate everything it earned. Nigeria’s economy was amongst the fastest growing on earth because it refused to put itself on a diet. If Goodluck had insisted on saving, Buhari would not have needed to print or borrow money, and the reforms Nigeria is ing through would not have been severe.

If Nigeria fails to learn to save, it will be stuck in a cycle of fast growth for a few years when oil prices rise and painful reforms for 10-20 years when oil prices fall.

Your talk on fuel subsidies is irrelevant. Gasoline prices in America are about the same as they were in 2006-2007. Prices are not at record highs. Fuel prices in Nigeria are so high because of the falling value of the Naira. Subsidies exist because of our bad savings culture. The government is not doing the citizens a favour; it is failing to maintain a stable currency and ing the cost on to the citizens.

Tianamen1:


Both Buhari and Tinubu have been horrible at managing Nigeria’s economy. I will never argue against this.
Understanding how a sovereign wealth fund works at stabilizing an economy is necessary for you know why I blame GEJ above anyone else. I will attach a YouTube short to this post.

In simple , a sovereign wealth fund is like a diet. It forces you to eat less than you can so you have suboptimal growth. When you produce less food, you can still maintain your previous level of consumption without having to borrow much.

Buhari either had to implement tough reforms or borrow money because Nigeria was eating everything it earned. Nigeria’s economy was amongst the fastest growing on earth because it refused to place itself on a diet. If Goodluck had insisted on saving, Buhari would not have needed to print any money or borrow any money. This reforms Nigeria is ing through would not have been severe.

If Nigeria fails to learn to save, it will be stuck in a cycle of fast growth for a few years, when oil prices are rising and painful reforms for 10-20 years when oil prices are falling.

Your talk on fuel subsidies is irrelevant. Prices of gasoline in America are about the same as they were in 2006-2007. Prices are not at record highs. Why prices of fuel in Nigeria are so high is because of the falling value of the Naira. Subsidies exist because of our bad savings culture. The government is not doing the citizens a favor, but it is failing at its responsibility at maintaining a stable currency and the ing the cost unto the citizens.

The PDP, either OBJ or Jonathan, started a sovereign wealth fund. There was also an Excess Crude . The State Governors led by Chibuike Amaechi and also maybe Lagos State sued to have it distributed. Again, very public knowledge. It actually happened and they won.

Fuel prices are high because of the falling value of naira. I agree with you. What caused the falling value of naira? Massive printing of naira in excess of productivity.

On the Sovereign Wealth Fund, I agree with you it was a missed opportunity. I think Nigeria does have one, there's simply not much money in it. Here's their website - https://nsia.com.ng/our-history/ The daughter of Buhari's then Chief of Staff, Abba Kyari, works there, got the job straight out of university

I've read some good economic papers that compare and contrast the UK with Norway. Both have North Sea crude oil but only one saved the income. Maybe Nigeria learned its ways from our Mother Country. Or maybe it's not possible to have a good public savings culture in such a diverse nation as Nigeria. What do you think of that?

Good Luck to Nigeria

IbeOkehie:


The PDP, either OBJ or Jonathan, started a sovereign wealth fund. There was also an Excess Crude . The State Governors led by Chibuike Amaechi and also maybe Lagos State sued to have it distributed. Again, it is very public knowledge. It happened, and they won.

Fuel prices are high because of the falling value of naira. I agree with you. What caused the falling value of naira? Massive printing of naira over productivity.

I agree it was a missed opportunity regarding the Sovereign Wealth Fund. I think Nigeria does have one, but there's not much money. Here's their website - https://nsia.com.ng/our-history/. The daughter of oBuhari's's then Chief of Staff, Abba Kyari, works there., she got the job straight outuniversity it DI. It read some good economic papers that compare and contrast the UK with Norway. Both have North Sea crude oil, but only one saved the income. Maybe Nigeria learned its ways from our Mother Country. Or maybe [it's impossible to have an excellent public savings culture in such a diverse nation as Nigeria.[/b] What do you think of that?

Good Luck to Nigeria

It’s interesting to see that the UK also messed up, as we did. We are in agreement on the issue. Since GEJ earned the highest income from crude oil sales and wholly depleted the 25 billion he inherited from the Excess Crude , he is responsible for this crisis. Put yourself in GEJ's, BUHARI’s and Tinubu’s shoes and say what you would have done differently. This is the most appropriate way to apportion blame.

Tianamen1:

It’s interesting to see that UK also messed up as we did. We are in agreement on the issue. I just personally feel that since GEJ earned the highest income from crude oil sales and also completely depleted the 25 billion he inherited from the excess. Crude , he is the most responsible for this crisis. Put yourself in GEJ’s, BUHARI’s, and Tinubu’s shoes and say what would I have done differently. This is the most appropriate way to apportion blame.

Jonathan messed up, largely for
1. Not fully removing the fuel subsidy in 2012. He reduced it though(for some reason most either have forgotten this or just choose to be mischievous)
2. The profligate waste of money, corruption etc

But he's been out since 2015, and you still blame him for the most part? Why?

His successor wasted and stole even more money, had absolutely no grasp of how to manage an economy. Started the downward spiral of the naira by the stoopid decision to also float the naira in 2016 which backfired badly and they had to backtrack on, but not after the damage had already been done.

They printed the ways and means and mismanaged even that cos they are pilf3ring sons of bitches but largely cos they could no longer keep up with the price differential/subsidy payments thanks to the naira that they had devalued. This was when naira slid to the 360/400s. The debt burden of the humongous subsidy they now had to pay due to their float misadventure was what led to those excess monies being printed secretly! Tinubu decided to tow the exact same path in 2023, removing subsidy too at the same time. That is why we have the shitstorm we have now, cos these muppets ain't got a shred of common sense.

Fast forward to 2023, maalu Buhari and emefoole tried to cover their tracks by mopping up that money thru the naira redesign policy, but like in 2012, same Tinubu and his minions riled up the populace against Emefoole and now here we are.

So you blaming Jonathan for all of that??

Tianamen1:

It’s interesting to see that UK also messed up as we did. We are in agreement on the issue. I just personally feel that since GEJ earned the highest income from crude oil sales and also completely depleted the 25 billion he inherited from the excess. Crude , he is the most responsible for this crisis. Put yourself in GEJ’s, BUHARI’s, and Tinubu’s shoes and say what would I have done differently. This is the most appropriate way to apportion blame.

also I'd like to drop some stuff here pertaining to the ECA (pre and post Jonathan), and the foreign reserves (pre and post Jonathan), so we all and are clear on the figures. Just to.shine a light on things for those interested in knowing the facts. Highest ECA recorded here was in 2012 and that was $11.5b, although the other article references that it hit 22b sometime under Yaradua sha...cant quite marry those two s, but anyway...

Treadway:
Also, I'd like to drop some stuff here about the ECA (pre and post-Jonathan) and the foreign reserves (pre and post-Jonathan) so we all and are clear on the figures. Just shine a light on things for those interested in knowing the facts. The highest ECA recorded here was in 2012, which was $11.5b, although the other article references that it hit 22b sometimes under Yaradua sha... I can't quite marry those two s, but anyway...

The cable news you just posted shows that the highest the excess crude reached was $22 billion. However, the chart starts in 2010 rather than 2004, when the excess crude was created, which invalidates the chart.


I focus on GEJ because resource-rich countries that are poorly managed experience the cycle Nigeria is ing through, and the remedy is maintaining an excess crude (sovereign wealth fund).

Nigeria has ed through this cycle twice in the last 50 years. When we have an opportunity to break out of the cycle, will we make the same mistakes of our past?

These are the facts.
GEJ was fortunate to lead Nigeria when crude oil prices were at their highest in recent history.
The money saved by his predecessor was consumed.
He saved no money.
Nigeria had one of the fastest-growing economies as a result of its spending.
Such spending created a problem once oil prices fell.
Buhari inherited a country with much lower revenues than its expenses and met no savings.
Buhari had few options. Raise taxes, cut government spending or borrow money.
Buhari borrowed money from the CBN(ways and means) and foreign institutions.
Tinubu inherited a highly indebted country with debt to revenue approaching 100 per cent.
Tinubu had a few options, too. Raise taxes, cut spending or borrow money.
Please tell me who I should blame amongst these three.

Regarding your comments on fuel subsidies, as hard as it may be for you to understand this, your government is lying to you. You must understand the relationship between the value of the Naira and crude oil prices to understand the government's duplicity. There are other factors, such as increased population, but that is still part of the government's responsibility. The Naira fell from N120 to N160 when Nigeria earned the highest amount from crude oil. This is a misnomer. When you talk about subsidy payments, you have to for changes in the exchange rate.

Obasanjo and Yaradua increased the value of the Naira from N140 to N116. Both leaders faced rising crude oil prices, and Obasanjo adjusted the price of petrol from N22 to N75. Both leaders held down government spending. However, GEJ increased government spending, forcing tough decisions on Buhari and Tinubu.

Tianamen1:


The cable news you just posted shows that the highest the excess crude reached was $22 billion. The chart starts at 2010 rather than 2004 when the excess crude was created. This invalidates the chart.


Why I focus on GEJ is because resource rich countries that are poorly managed go through the cycle Nigeria is ing through and the remedy is maintaining an excess crude (sovereign wealth fund).

Nigeria has ed through this cycle twice now in the last 50 years. The next time we have an opportunity to break out of the cycle, would we make the same mistakes of our past?

These are the facts.
GEJ was fortunate to lead Nigeria at a time when crude oil prices were at their highest in recent history.
The money saved by his predecessor was consumed.
No money was saved by him.
Nigeria had one of the fastest growing economies as a result of his spending.
Such spendings created a problem once oil prices fell.
Buhari inherited a country with much lower revenues than its expenses and met no savings.
Buhari had few options. Raise taxes, cut government spending or borrow money.
Buhari borrowed money both from the CBN(ways and means) and from foreign institutions.
Tinubu inherited a highly indebted country with debt to revenue approaching 100 percent.
Tinubu had few options too. Raise taxes, cut spending or borrow money.
Tell me who I should blame amongst these three.

As regards your comments in fuel subsidies, as hard as it may be for you to understand this, your government is lying to you. You have to understand the relationship between the value of the Naira and crude oil prices to understand the duplicity of the government. There are other factors such as increased population but that is still part of the responsibility of the government. The Naira fell from N120 to N160 when Nigeria was earning the highest amount from crude oil. This is a misnomer. When you talk about subsidy payments you have to for changes in the exchange rate.

Obasanjo and Yaradua were able to increase the value of the Naira from N140 to N116. Both leaders faced rising crude oil prices and Obasanjo adjusted the price of petrol from N22 to N75. Both leaders held down government spending. However, GEJ increased government spending forcing tough decisions on Buhari and Tinubu.

the chart isn't invalid. It states the period under review as 2010-2022. The article states the highest amount recorded in the ECA was under Yaradua, so let's agree that it likely happened before 2010.

Yes, I know and agree Jonathan bleeped up, but someone else is central to all the things we have already talked about today,and that is Tinubu. He was one of those who rallied the populace against subsidy for political reasons, HE advocated for the excess printing of money, HE again thwarted what could have been a mop up of that same money by rallying the populace against that policy also for political reasons.

Floating the naira was a bad bad move. You don't say with mouth that you want to remodel your house, then move to burn down the house, when you don't even have cement or bricks on ground to do the remodeling. It was stupid, is what it was. They all met debt and ballooned it uncontrollably due to subsidy payments that were huge because the naira had been devalued. He has increased domestic debts by over 45trn and foreign debt by ard $20b in just one year still due to the effects of this same devaluation....and of course corruption! Let them continue on this trajectory, we will all see where it will lead. Jonathan bleeped up, but if we didn't have a conglomerate of inept and self serving criminals called the APC at the helm of affairs, we won't be in this horribly precarious situation today...and so I allocate a whole lot more blame to them.

Obasanjo wasn't handed a great slate either when he was brought out from prison to rule in 1999, but we can all now see that despite that he also was flawed, and could have done and been better, the man still tried!

It's all good sha.

Treadway:
The chart isn't invalid. It states the period under review as 2010-2022. The article states the highest amount recorded in the ECA was under Yaradua, so let's agree that it likely happened before 2010.

Yes, I know and agree Jonathan bleeped up, but someone else is central to all the things we have already talked about today, and that is Tinubu. He was one of those who rallied the populace against subsidy for political reasons. He advocated for the excess printing of money. He again thwarted what could have been a mop-up of that same money by rallying the populace against that policy, also for political reasons.

Floating the naira was a wrong move. You don't say with a mouth that you want to remodel your house, then move to burn down the house when you don't even have cement or bricks on the ground to do the remodelling. It was stupid, is what it was. They all met debt and ballooned it uncontrollably due to substantial subsidy payments because the naira had been devalued. He has increased domestic debts by over 45 trillion and foreign debt by $20 billion in just one year, still due to the effects of this same devaluation and, of course, corruption! Let them continue on this trajectory; we will all see where it will lead. Jonathan bleeped up, but if we didn't have a conglomerate of inept and self-serving criminals called the APC at the helm of affairs, we wouldn't be in this precarious situation today...and so I allocate a whole lot more blame to them.

Obasanjo wasn't handed an incredible slate either when he was brought out from prison to rule in 1999, but we can all now see that despite his flaws and the fact that he could have done better, the man still tried!

It's all good, sha.

I agree with most of what you have said. Tinubu is doing a horrible job.

omohayek:

Yawn. More foul-mouthed idiocy from a föol, full of sound and fury, signifying nothing.

Omohayek,
You've been rather silent. I hope no problem.

Has the Trump victory rubbed you the wrong way?

America don enter one chance.