ABUJA (Reuters) – Nigeria’s new president, Muhammadu Buhari, has been advised to end a fuel subsidy program and privatize Nigeria’s four refineries in a report by his transition committee, senior sources in his party told Reuters on Sunday.
Africa’s top oil producer and biggest economy heavily subsidizes gasoline and relies on imports for the bulk of its domestic demand due to an underperforming refining system.
The subsidy, which was revealed to have paid out more than $6 billion in fraudulent claims in 2012, is proving to be increasingly costly.
Buhari, who became president three weeks ago, is considering the recommendations in the strategy report, produced by a 19-member committee formed from his All Progressives Congress (APC) party.
“The removal of the fuel subsidy is one of the recommendations of the transition committee,” said a senior APC source, who did not want to be named.
“The committee also suggested to Mr President that the four refineries be privatized so that the government stops wasting money on annual turnaround maintenance,” he said.
A second APC source also told Reuters that these recommendations were contained in the report, which was given to Buhari earlier this month.
(Reporting by Felix Onuah; Writing by Alexis Akwagyiram; Editing by Kevin Liffey)