President Bola Tinubu-led Federal Government has been urged by human rights lawyer Femi Falana (SAN) to resist pressure from the International Monetary Fund (IMF) to raise fuel and electricity costs.
Falana in a statement issued on Saturday urged the government to stop implementing the risky IMF recommendations, which include eliminating subsidies and floating the Naira.
The Senior Advocate of Nigeria (SAN) who doubled as the Chair of the Alliance on Surviving COVID-19 and Beyond (ASCAB) said the international “intruder” should be questioned for holding Nigeria and the United Kingdom to different standards rather than implementing the IMF’s recommendation.
He called on the Federal Government to have the bravery to refuse the perilous IMF demands to raise the nation’s electricity prices and PMS pump prices.
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“Our economic managers should be wary of the sort of lectures they receive from the IMF on the matter of subsidies given the realities in some advanced capitalist economies,” Falana noted.
READ ALSO: Petrol subsidy nears N1trn monthly, bigger than when Tinubu came- Report
He recalled: “Three days ago, the IMF directed the Bola Tinubu administration to remove the pump price of fuel and electricity tariffs without any further delay on the grounds that “current subsidized rates are thought to be significantly below the actual market prices.
“By phasing out these subsidies, the government would allow fuel and electricity prices to align more closely with their true market value, potentially leading to increased costs for consumers.
“Barely 24 hours later, the Minister of Power, Mr. Adebayo Adedibu said that Nigeria could not continue to subsidise electricity, adding that the nation must begin to move towards a cost-effective tariff model, as the country is currently indebted to the tune of 1.3 trillion naira to generating companies (GenCos) and 1.3 billion dollars owed gas companies.
“It is doubtful if the neoliberal ideologues in the government are aware of the fact that on January 30, 2024, the IMF warned the UK Chancellor, Jeremy Hunt against cutting taxes, arguing that that country needs to curb public borrowing and prioritise spending in areas such as health, education and tackling climate change.
“Pierre-Olivier Gourinchas, the IMF chief economist, told the Financial Times that the UK’s focus should be on “the path towards a fiscal consolidation” despite expectations that Hunt would cut taxes at his spring Budget.
“Hunt should be “trying to rebuild fiscal buffers . . . in the context in which there are important spending needs”, Gourinchas said, rather than add to the £20bn of personal and business tax cuts delivered in November.
“We would rather wish they would not do this type of tax cuts, and that they would instead focus on both addressing the spending needs and on the path towards fiscal consolidation.”
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