The International Monetary Fund (IMF) has warned the Federal Government against restoring broad petrol subsidies, urging it to adopt targeted support for vulnerable households struggling with rising energy costs.
According to TheCable, the international financial institution said blanket petrol subsidies were expensive, often benefited higher-income consumers disproportionately and could worsen Nigeria’s fiscal pressures amid rising borrowing costs.
The IMF acknowledged that Nigeria’s economy had made substantial progress but warned that the benefits of economic growth remained unevenly distributed, leaving many citizens struggling with the cost of living.
It urged policymakers to balance households’ immediate needs with medium-term fiscal stability, recommending targeted interventions to protect vulnerable populations rather than broad-based fuel subsidies.
“What we are advocating is for policymakers to balance the near-term needs of the population, and that involves food security. That involves energy security,” the IMF said.
The recommendation highlights the need for the Federal Government to address the impact of rising energy costs on households while maintaining fiscal discipline and prioritising support for those most affected by economic hardship.