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Fuel price hike suicidal — NLC

Posted by Babatunde Oke, Clara Nwachukwu, Michael Faloseyi and Emmanuel Obe on 2005/08/05 | Views: 336 |

Fuel price hike suicidal — NLC

The Nigeria Labour Congress and the Campaign For Democracy on Thursday warned that the planned increase in the cost of fuel would be suicidal for the economy.

The Nigeria Labour Congress and the Campaign For Democracy on Thursday warned that the planned increase in the cost of fuel would be suicidal for the economy.

They said that Nigerians who are currently groaning under the pains caused by past hikes would not accept any fresh increase in fuel price by the Petroleum Products Pricing Regulatory Agency and the Nigerian National Petroleum Corporation.

The two bodies spoke shortly after our correspondents learnt that the major oil marketers would meet in Lagos on Friday (today) to determine how much to add to the current pump prices.

A litre of Premium Motor Spirit (petrol) sells for between N50.50 and N50.80 and Automotive Gas Oil (diesel), N63 in most of the states in the South-West.

In the other five geopolitical zones, a litre of any of the products is between 20 per cent and 40 per cent higher.

The NLC which had in the past been the arrowhead of opposition against previous increases, called on the government to discountenance the plan by the PPPRA and the NNPC.

“This is the worst time that any Nigerian, who by virtue of being in government should increase the hardship of the people,” the NLC President, Mr. Adams Oshiomhole told newsmen after a Central Working Committee meeting of the congress in Lagos.

He added, “It will be a grave mistake for the government to accede to the proposal of the NNPC and the PPPRA to add to the burden of Nigerians. Nigeria’s economy is still driven by generators. Petroleum products have direct impact on the economy, in a situation where infrastructural facilities are not functioning.

“Every Nigerian is a municipality on his own, as he has to provide his own light, water and other infrastructures.

“We, in the NLC, are sure that Nigerians will not accept another increase.”

Oshiomhole said that the NLC had earlier written the Federal Government and will next week write another letter to President Olusegun Obasanjo to implement the recommendations of the Senator Ibrahim Mantu-led palliative committee to continue subsidising the products until a permanent solution to the pricing problem is found.

“We have written and we want to write another to the government and President Obasanjo to resist the temptation of increasing the prices but take the recommendations of the Mantu Committee that part of the windfall should be used to ensure that Nigerians are at comfort.”

The labour leader therefore urged the government to channel part of the windfall earmarked for debt servicing in subsidising fuel.

“We also feel that if part of the debts had been truly forgiven, if the people that put the debt trap had decided to remove it, if the West can abandon the logic of the market to forgive the debts, the government should go to the drawing board and ensure that the debt forgiveness is felt by ordinary Nigerians,” he said.

He stated that debt forgiveness was not to be enjoyed by the government but the people.

In Ibadan, the Oyo State capital, the CD asked the government to stop the proposed increase if it really cared about the plight of Nigerians, most of who live below the poverty line.

The President of the organisation, Mr. Mashood Erubami, said in a statement, that increases in fuel prices had become the style of the government.

Erubami said that the CD held a meeting in Lagos on Wednesday at which it resolved to mobilise Nigerians and civil society organisations to protest the proposed increase.

He said, “Past fuel price increases have not improved the backward indifference of the Federal Government towards education; the roads have remained in their state of disrepair.

“The economy is still moribund; hunger, want and social deprivations have remained the lot of Nigerians from successive increases and power supply has remained elusive.”

The CD boss said that government was not being sincere when it said that further increases were in the interest of Nigerians, especially if they (increases) were necessitated by rising price of crude oil in the international market.

He added that government should rather use the surplus realised from the exportation of crude oil to cushion the effects of economic hardship on the people.

Erubami advised the government to intensify efforts at stamping out corruption in high places, which had brought the economy to its knees.

He said that the solution to price increases was for government to free itself from the shackles of the foreign organisations, improve capacity utilisation of the refineries and ensure that private licensees built refineries for the local market.

Also in Lagos, the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture, condemned the proposed fuel increase.

It said that a rise in prices would worsen the economy, increase the cost of doing business and hardship among the citizenry.

Its President, Chief John Odeyemi, referred the PPPRA to the Mantu palliative committee that recommended that the federal government should subsidise fuel prices in the country until the establishment of more refineries.

Odeyemi, who was a member of the committee, recalled that contrary to reports that the refineries were producing at full capacity, it was only last month that they resumed production.

He explained that even if the refineries were operating at 100 per cent capacity, they would only account for 25 per cent of the domestic demand, which supports the need for subsidy.

Major Marketers Committee, comprising the big petroleum products marketers, is expected to meet on Friday to determine the prospects of the planned hike.

The meeting will hold on Friday at the corporate head office of Total Nigeria Plc.

The spokesman for the oil majors, Mr. Onochie Hafner, told our correspondents that whatever new price level to be determined by the PPPRA and the stakeholders would have to be based on the ex-depot price of the commodity.

Hafner said, “Whatever new price level would have to be worked out based on the ex-depot price from NNPC and work out a reasonable margin, not profit, because we are hardly making any profit now.”

This, according to him, was the main reason why the majors abandoned products importation to the NNPC

He said that the only way out of the current quagmire was the full deregulation of the downstream sector, and allowing market forces to determine prices.

On the allegation that some marketers were discretely increasing their pump prices, Hafner said it was not possible.

“The filling stations take authorisation from us to effect any price change and we have not given such authorisation,” he said.

The PUNCH, Friday, August 05, 2005

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Comments (23)

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