Hardship: States Get N570bn Grant

President Bola Tinubu announced on Sunday that the Federal Government has released N570bn to the 36 states to expand livelihood support to their citizens. This measure is part of the government's effort to alleviate hardship and stimulate economic growth across the country. In his nationwide broadcast, Tinubu highlighted that Nigeria spends approximately N2tn monthly on the importation of Premium Motor Spirit (petrol) and Automotive Gas Oil (diesel). Despite the nation's abundant oil and gas resources, the administration found that the country had been relying solely on oil-based petrol while neglecting its gas resources. This reliance on oil has been costly, as it involves substantial foreign exchange expenditure to pay for and subsidize fuel. To address this issue, the administration has invested in Compressed Natural Gas (CNG) initiatives to diversify the energy supply, reduce costs, and increase efficiency. Tinubu stated, “To address this, we immediately launched our Compressed Natural Gas Initiative to power our transportation economy and bring costs down. This will save over N2tn a month, being used to import PMS and AGO and free up our resources for more investment in healthcare and education.”

The government has begun distributing one million low-cost conversion kits to commercial vehicles, which currently consume 80% of imported petrol and diesel. This initiative, in partnership with the private sector, aims to reduce transportation costs by approximately 60%, thereby helping to curb inflation. Despite being Africa's largest oil producer, Nigeria's low refining capacity necessitates the importation of petroleum products. The Nigerian National Petroleum Company Limited remains the sole importer of petrol, while licensed individuals import diesel. Tinubu also addressed the ongoing nationwide protests that began on August 1, 2024, expressing his administration's willingness to listen to and address the concerns of the protesters.

The President reported a significant increase in fiscal revenue, with N9.1tn accumulated in the first half of 2024—more than double the revenue from the same period in 2023. This increase is attributed to efforts in blocking leakages, automating processes, and mobilizing funding without additional burdens on the populace. He noted, “Productivity is gradually increasing in the non-oil sector, reaching new levels and taking advantage of the opportunities in the current economic ambience.” Additionally, Tinubu highlighted a reduction in Nigeria's debt burden, with debt service revenue declining from 97% in 2023 to 68% in 2024. The country has also cleared legitimate outstanding foreign exchange obligations of about $5bn without adversely impacting government programs. This reduction in debt has provided greater financial freedom, allowing for increased spending on essential services such as education and healthcare."