Nigeria, the sixth largest oil producing country in the Organisation of Petroleum Exporting Countries (OPEC), spends an estimated $15 billion yearly on the importation of petroleum products, the Lagos Chamber of Commerce and Industry (LCCI) has revealed.
This explains why Muda Yusuf, director-general, LCCI, urged the incoming government to halt this huge drain on the nation’s foreign exchange, adding that way forward is to revamp the ailing refineries and encourage private sector participation in downstream oil sector.
“Going forward, we need to fix the refineries or incentivize the private sector to play this role. The biggest burden on the treasury of government is the importation of petroleum products and the inherent transparency issues. The biggest platform for corruption in the economy today is the management of subsidy on petroleum products. The pressure it exerts on the government treasury is enormous.
“An accelerated reform of the oil and gas sector and the passage of the Petroleum Industry Bill (PIB) will mitigate the challenge the subsidy management poses for government finance. This will also facilitate the restructuring and diversification of the economy,” he said.
Talking about budget structure, Yusuf stressed the scrutiny of several budget heads to ensure cost-effectiveness and better transparency in the management of public finance.
The LCCI boss listed Consolidated Revenue Fund Charges, Service Wide Vote, Presidential Amnesty Programmes, Capital Supplementation and Debt Service as some of the sub-heads to be revisited.
“All these budget heads have substantial amounts voted for them in the budget annually. Some of the provisions do not reflect the desired prudence in the management of public funds,” he said, while adding that “huge savings will be made if proper scrutiny of budget heads is made.”

Maureen Nzeogu
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