In its June 2023 Nigeria Development Update released on Tuesday in Abuja, the World Bank has projected that the Federal Government of Nigeria will save N2 trillion in the remaining six months of 2023 following the removal of petrol subsidy. The report also forecasts savings of over N11 trillion by 2025.
The Nigeria Development Update (NDU) report by the World Bank highlights the removal of petrol subsidy and foreign exchange (FX) management reforms as crucial steps toward rebuilding fiscal space and restoring macroeconomic stability.
Acknowledging the ongoing macroeconomic imbalances, the report stresses the importance of further policy reform measures while commending the new administration for the critical reforms it has already initiated.
The report advises President Bola Ahmed Tinubu to seize the opportunity to make a transformative impact on the lives of millions of Nigerians and establish a solid foundation for sustainable and inclusive growth.
To maximize the collective impact on growth, job creation, and poverty reduction, the NDU recommends implementing a comprehensive reform package that includes a new social compact to protect the poor and vulnerable.
World Bank Country Director for Nigeria, Shubham Chaudhuri, commends the Tinubu government’s efforts in implementing long-awaited reforms. Chaudhuri emphasizes the need for compensatory actions to mitigate the short-term impact on the poor.
Additionally, Chaudhuri advocates for the implementation of a cash transfer program as part of a broader agreement to redirect fiscal resources towards development priorities. This program aims to provide relief to those most affected by higher petrol prices.
