Centre for Climate Change and Development (CCCD) at Alex Ekwueme Federal University (AEFUNAI), in collaboration with the Overseas Development Institute (ODI) London, is holding an online event to present the key findings from the recent national research on Nigeria’s subsidy reforms and its energy transition agenda.
The CCCD and ODI conducted a research aimed at understanding the impacts of fuel subsidy reforms and its potential near-term consequences.
The research, which is based on an extensive literature review, economic modelling techniques, and interviews with several leading thinkers in Nigeria, explored the opportunities and challenges associated with subsidy reforms in relation to Nigeria’s energy transition agenda.
It also offers a suite of guides for politically smart, socially inclusive reforms and reallocation of public funds, which in the long term could be the first step to planning towards a just and equitable transition away from fossil fuels.
In May 2023, President Bola Tinubu announced the immediate removal of Nigeria’s petroleum subsidy, leading to dramatic increases in end-user fuel prices.
While there are compelling justifications for subsidy reforms, considerable problems exist about the method, consequences, and sustainability of the reforms.
The failure to mitigate the short-term socio-economic effects of subsidy reforms would have multi-level consequences across Nigeria’s economy and populations.
It could harm the most vulnerable segments of Nigeria’s population and introduce political risks to the sustainability of reforms, as experienced by similar attempts by former governments.
A real or perceived lack of transparency in the sector could also make it difficult to determine the various other ways in which state revenues are being lost, which can further hinder sector reforms and cause a range of environmental, social, and economic harms.
The workshop will be held today between 12:00 and 13:30 WAT, and will be hosted by Nwajiku-Dahou, director of Politics and Governance Programme at Overseas Development Institute, and Chukwumerije Okereke, director of Centre for Climate Change and Development at Alex Ekwueme Federal University, Ndufu-Alike, Nigeria (CCCD-AEFUNAI).
Sam Onuigbo, member of the governing board and chairman of the Committee on Climate Change of the North East Development Commission, and Solomon Maren, national coordinator of the African Parliamentary Network on Climate Action, are guests of honour.
Speaking ahead of the event, the Director of Centre for Climate Change and Development, Chukwumerije Okereke, said the research was in tandem with the mission of the centre to collaborate with top-level international partners to undertake high-quality research to generate knowledge that will contribute to climate-resilient and sustainable development of Nigeria and Africa.
He expressed the hope that the Federal Government will utilise the findings of the research to reform the fuel subsidy in ways that will be fairer, more progressive and better advance the energy transition objectives of the country.