President Bola Tinubu has once again defended his administration’s decision to remove fuel subsidy, insisting that the policy saved Nigeria from imminent bankruptcy and helped stabilize the nation’s economy after years of fiscal strain.
Speaking during a gathering with state governors in Lagos to mark the third anniversary of his administration, the President described the decision as painful but necessary to prevent economic collapse and restore long-term financial stability.
According to Tinubu, Nigeria had spent years channeling enormous public resources into a subsidy regime that became increasingly unsustainable and deprived critical sectors of the economy of much-needed investment.
He argued that maintaining the subsidy system would have pushed the country toward deeper fiscal distress and limited the government's ability to fund infrastructure, agriculture, education, healthcare, and other development priorities.
The President acknowledged that the removal of subsidy created significant hardship for millions of Nigerians, particularly through rising transport costs, food inflation, and increased living expenses.
However, he maintained that the difficult reforms were beginning to produce positive economic outcomes.
Tinubu stated that despite initial resistance, litigation, and public criticism, Nigeria had avoided the economic crisis that many analysts feared could emerge if subsidy spending continued unchecked.
"It was challenging at the time, but we survived. Instead of bankruptcy, Nigeria has survived," the President reportedly told the governors.
The subsidy removal, announced on May 29, 2023, remains one of the most consequential economic decisions of Tinubu’s presidency.
The move effectively ended decades of government payments used to keep petrol prices artificially low, resulting in a sharp increase in fuel prices nationwide and triggering one of the most severe cost-of-living crises in recent Nigerian history.
Despite the hardship, the administration argues that the policy has strengthened public finances and improved investor confidence.
Government officials point to increased revenue generation, foreign investment inflows, improved domestic refining capacity, and stronger fiscal management as evidence that the reforms are beginning to yield results.
Tinubu further claimed that state governments are now in a stronger financial position than before the reforms.
According to him, governors are no longer as dependent on federal interventions to pay salaries and meet basic obligations because revenue allocations have improved following fiscal adjustments.
Vice President Kashim Shettima also defended the policy, describing it as an act of political courage that previous administrations had avoided despite acknowledging the problems associated with the subsidy regime.
He argued that confronting long-standing structural weaknesses required difficult decisions rather than postponing reforms for political convenience.
Similarly, the Chairman of the Nigeria Governors’ Forum and Governor of Kwara State, AbdulRahman AbdulRazaq, praised the policy, saying increased revenues have enabled many state governments to clear outstanding obligations and execute development projects.
Supporters of subsidy removal have long argued that the system disproportionately benefited fuel importers, middlemen, and smugglers while consuming funds that could have been invested in critical infrastructure and social services.
Many economists also contend that subsidies distorted market realities and imposed a heavy burden on public finances.
However, critics maintain that the government implemented the reform without sufficient social protection mechanisms to cushion its effects on ordinary citizens.
They argue that rising fuel prices contributed directly to higher transportation costs, food inflation, and declining purchasing power across the country.
The debate remains one of the most polarizing issues of Tinubu’s presidency.
While supporters view the reform as a necessary correction of long-standing economic distortions, opponents argue that many Nigerians continue to struggle with the consequences of the policy three years later.
Beyond defending subsidy removal, the President highlighted ongoing investments in roads, housing, agriculture, education, and natural gas infrastructure as evidence that savings from reforms are being redirected toward development projects.
Among the projects commissioned during the anniversary celebrations were several TETFund-supported educational facilities and major compressed natural gas (CNG) infrastructure projects aimed at promoting cleaner and more affordable transportation alternatives.
The administration has increasingly promoted CNG adoption as part of its strategy to reduce transportation costs and lessen dependence on petrol following subsidy removal.
Analysts say the long-term success of the subsidy reform may ultimately depend on whether economic gains become visible at the household level through lower inflation, job creation, improved public services, and stronger purchasing power.
While some macroeconomic indicators have shown improvement, many Nigerians continue to judge the policy primarily through its impact on their daily cost of living.
Political observers note that the subsidy debate is likely to remain central to national discourse as preparations for the 2027 elections gather momentum.
The issue has become one of the defining policies of Tinubu’s administration and may significantly shape public assessment of his presidency in the years ahead.
For now, President Tinubu insists that the difficult decision prevented a fiscal disaster and placed Nigeria on a path toward recovery.
Whether history ultimately views the policy as a transformative reform or an excessively costly economic adjustment may depend on how fully the promised benefits materialize for ordinary Nigerians in the years ahead.