FUEL PRICE CUT: Not Too Nice A Fiscal Policy Its catchy to reduce fuel price in the heat of intense political environment to buy voters favor by government. I dont think government political calculations in this comes with great benefits. I dont see this gesture - however politically suave it may appear - significant to alter the president political fortunes. The margins are slim. Its economically and fiscally a bad decision - except may be, they acted to pre-empty the opposition from brushing it first as a campaign promise. Nigeria is faced with huge fiscal crises up 50% budget deficit as falling oil prices from global glut forced oil dependents economies into austerity. Falling oil prices represent very large energy subsidy relief. The freed funds from subsidies should have been a significant cushion for budget used to balance coming cuts in health care and education. This represents a reclamation from negative taxation that does not require legislation, or civil opposition. We dont need that reduction now, which has already been countered in naira slide against the dollar to some degree. #crossflames
Posted on: Mon, 19 Jan 2015 11:35:05 +0000