The Nigerian Federal Government officially announced the termination of fuel and foreign exchange (FX) subsidies, a policy shift aimed at redirecting resources within the economy.
This decision was disclosed by Finance Minister Wale Edun during the World Bank's Nigeria Development Update in Abuja.
The subsidies, which had been costing over N10 trillion or approximately 5% of Nigeria's GDP, were seen as unsustainable in the long term. By ending these subsidies, the government aims to reallocate funds more effectively, potentially enhancing fiscal sustainability and economic growth.
Historically, subsidies have been a contentious issue in Nigeria, often criticized for benefiting the wealthy more than the poor and being prone to corruption.
The removal of these subsidies aligns with broader economic reforms intended to stabilize the economy and reduce dependency on government support.
In conjunction with ending subsidies, the government has introduced a new initiative focused on reducing unemployment through housing finance.
This includes a mortgage scheme offering near single-digit interest rates, expected to stimulate the construction sector and create job opportunities.
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