The World Bank-backed the FG on ending the petrol subsidy

The World Bank said on Thursday that the removal of petrol subsidies in Nigeria was an important step in the midst of the CovID 19 crisis.

 

The World Bank-backed the FG on ending the petrol subsidy

The Bank, in its "Africa's Pulse" report, entitled "Charging the Road to Recovery", said that sub-Saharan African countries should take advantage of the crisis to accelerate their structural reform agenda. Taking advantage

 

He said, "The Covid-19 crisis is not being wasted in the countries of the region; in Nigeria, the government has taken important steps to reform its subsidized government.

 

The World Bank noted that the Nigerian government has abolished petrol subsidies and introduced market-based pricing mechanisms without any price limit.

 

"The price of petroleum (petrol) is determined each month by the Petroleum Products Pricing Regulatory Agency based on market costs," it said.

 

When the prices of international petroleum products begin to rise, the PPPRA will allow prices to rise accordingly.

 

Punch had said on September 8 that the abolition of petrol subsidy by the federal government and increase in electricity rates was in line with the reforms sought by the International Monetary Fund and the World Bank.

 

In a report on August 17, Reuters quoted sources as saying that the World Bank is unlikely to approve the much-needed 1.5 1.5 billion for Nigeria in August due to concerns about the desired reforms.

 

Fuel subsidies and electricity tariffs are also being discussed’ Reuters reported, with a banking source saying the loan could not be’ approved until October.

 

The World Bank predicted on Thursday that sub-Saharan Africa's real GDP would contract to 3.3 percent this year, after growing 2.4 percent in 2019.

 

It said, "In Nigeria, after an annual growth of 1.9% in 2020 Q1, the annual GDP contracted by 6.1 years in 2020 Q2, with growth in the oil and non-oil sectors slowed.

 

"The short-term outlook faces considerable uncertainty as the economy continues to be gripped by the effects of epidemics."

 

The report said that the activity data shows that the uptrend in activity starting in Q3 2020 has stopped.

 

"Despite the uncertainty, investment is weak. It added that growth would slow to 4.1 percent in 2020 and 0.3 percent in 2021.

 

According to the World Bank, although Nigeria's public debt is expected’ to rise, it is expected’ to remain below 30% of GDP in 2020.

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