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Fuel Subsidy Axed, Nigeria Bags $84bn Windfall and 40 Roads — Report Reveals Shocking Gains!
The Federal Government has revealed that the removal of petrol subsidies by President Bola Tinubu has halted a long-standing economic drain that cost Nigeria over $84 billion, enabling the execution of 40 key road projects nationwide within two years.....KINDLY READ THE FULL STORY HERE▶
This was outlined in a policy brief published by the National Orientation Agency (NOA), titled “Two Years Later: Key Benefits of Subsidy Removal”, and obtained by our correspondent on Sunday in Abuja.
The document, which reviewed the outcomes of the subsidy removal since its implementation on May 29, 2023, stated that the policy averted an impending economic crisis. It has also allowed the Tinubu administration to settle longstanding debts, increase capital investment, and enhance financial stability across state economies.
“For years, especially under democratic rule, petrol subsidies drained national revenue. Despite multiple attempts by past administrations to end the regime, it remained a significant burden. By 2022, the subsidy budget skyrocketed by 700% to N4 trillion—the highest in Nigeria’s history,” the NOA explained.
Between 2005 and 2022, successive governments spent a staggering $84.39 billion on fuel subsidies, which consumed over 70% of projected federal income and pushed the nation toward bankruptcy. However, with the removal of subsidies, the country is now saving billions and redirecting funds toward real infrastructure development.
The NOA emphasized that President Tinubu’s declaration—“subsidy is gone”—on his first day in office marked the beginning of critical economic reforms, with noticeable fiscal benefits. One of the key improvements has been the increased financial independence of state governments.
“Ending the subsidy not only shielded the entire economy from collapse but also rescued many states from financial ruin. Before Tinubu’s administration took over, Nigeria was using 97% of its revenue to service debt, and the national debt had exceeded N100 trillion,” the agency noted.
The removal of subsidies, which previously forced both federal and state governments to rely heavily on borrowing, has helped stabilize the national economy and ease financial pressure on subnational governments.
According to the NOA, most states that once struggled to meet payroll obligations are now financially solvent, even after substantial hikes in minimum wage.
“In 2023, the 36 states and 774 local governments received N6.16 trillion in FAAC allocations—a 28.6% increase from N4.79 trillion in 2022. By 2024, FAAC revenues had jumped to N15.26 trillion, with states and LGAs receiving N9.58 trillion, N3.42 trillion more than the previous year.”
As per Debt Management Office data, subnational domestic debts declined from N5.82 trillion in June 2023 to N3.97 trillion by December 2024—indicating that states repaid N1.85 trillion within 18 months.
Additionally, the NOA said subsidy savings helped the federal government clear a $7 billion forex backlog owed to foreign airlines and companies, a situation that had placed Nigeria among the countries with the highest outstanding FX obligations.
Despite continuous debt servicing and currency interventions, the nation’s external reserves rose from $35 billion in May 2023 to $38.9 billion by March 2025.
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