It seems Aliko Dangote’s prediction is coming to pass as the richest man in Africa predicted that a dollar may be bought for N500 if fuel subsidy is removed.
The federal government announced on Wednesday, May 11 that it has removed subsidy on petrol which increased the price from N87 to N145.
The removal of the subsidy also affected the naira as on Friday, May 13, reports showed the dollar sold for N290 and N360 at the Central Bank of Nigeria and black market respectively and there are indication is will get worse.
Dangote in an interview with Vanguard in 2015 spoke about Nigeria’s economy and what will happen if subsidy is removed.
“The issue with subsidy is that government needs to block all loopholes. If there’s no subsidy, it will affect our foreign exchange, we’ll end up buying a dollar at N500, because there’s no VAT on petroleum products. That’s why the import of petroleum products is taking about 30% of our foreign reserve. We just need to make sure that there’s no siphoning of money.
“The refining business requires volume. If you don’t have a massive volume, there’s no way you’ll make money. Most of the refineries in Africa are running at a big loss. It’s not possible for government officials to successfully manage oil businesses. It’s good enough if they remove the subsidy, but you can check with neighbouring countries like Senegal. If a poor person in Senegal can afford to pay subsidy, why can’t a poor person in Nigeria afford to pay. I think there must be something for the masses, which should be in terms of power, social insurance, good education system, good roads etc.”
Dangote also advised Nigerians to invest in Nigeria and stop taking money to western countries. He however said it requires determination.
This requires determination and seriousness. These things are humanly possible and we should be able to do them. It’s not really the work of the government to make a country prosperous, it’s the work of individuals because the duty of the government is to facilitate, but government will not have the money to invest.
“That’s why it’s shameful that some Nigerians go and keep their money abroad. It is very difficult when we have a huge chunk of our money abroad and we want foreigners to come and invest. They won’t believe that the environment is good. It won’t work that way.
“The only way is for us to lead, even though we can’t do all, but that leadership will pave the way for others to invest their money in our economy. In fairness, it’s difficult for people to find a place where they can make good money like Nigeria but it is also very tough. Once you are in business in Nigeria, you won’t be able to find enough sleep. Doctors always advice that we sleep for six to seven hours. I don’t think people who sleep for that long can operate businesses in Nigeria”
Meanwhile, amidst report that the naira had been devalued, the CBN says such a decision was never taken by the financial institution.
Isaac Okoraofor, the acting director of the company’s corporate communication department, described the speculations as the handiwork of those bent on seeing Nigeria do official work on the social media.