Nigerians feel pinch as fuel strikes take a toll
Nigerian President Goodluck Jonathan has drawn praise from economists for cutting a costly fuel national subsidy, but citizens have responded with rolling strikes that have shut down cities around the country.
Folenke’s food shop, in the heart of Lagos, is nearly empty because she can’t afford to go to the wholesale market to restock the bare shelves.Skip to next paragraph
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Tarek Shams, station manager for Egyptian Air at the Murtala Mohammed International Airport, looked shell-shocked as he tried to explain to angry passengers why he had already decided to cancel the flight out of Lagos on Tuesday.
“I can not face tomorrow what I faced today,” he said, explaining that his workers had to have an armed police escort to deliver fuel to the one Egyptian Air flight that landed and departed Lagos on Monday. As the airline workers were transferring fuel, Mr. Shams said, they were greeted by union protesters burning debris in the road. He said union people came to him and told him he should stand with them and not fly today. Domestic flights were cancelled and other airlines such as KLM canceled their Monday evening flights out of Lagos.
Welcome to the brave new world of Nigerian shock-therapy economics. On Jan. 1, the Nigerian government decided to remove fuel subsidies, with President Goodluck Jonathan calling them a "cancer" on the Nigerian economy -- preventing government from spending in other areas, such as building roads, maintaining schools, and keeping the electric power supply running. Economists such as the International Monetary Fund's Christine Lagarde and Harvard economist Jeffrey Sachs have praised the move, but citizens have reacted with a mixture of anger and bewilderment. A series of rolling strikes started Monday, shutting whole cities around the country.
Though Nigeria is Africa’s largest oil exporter it imports nearly all its fuel because its refineries are in bad repair. To keep fuel prices within the reach of ordinary Nigerians, the government has paid importers the market rate and allowed fuel to be sold to customers at nearly half the cost. But officials say the fuel subsidies, estimated to be about $7 billion each year, were crippling the national budget and siphoning funds needed for roads, schools and other infrastructure.
Less than two weeks after the subsidy removal, its effects are starting to trickle down to the larger economy. Fuel prices skyrocketed from a mere 41 US cents to as much as 94 cents in some areas. It’s a price jump that has turned poor people into protestors and Lagos gas stations into deserted islands as millions of Nigerians took the streets around the country to demonstrate against the government’s decision to no longer help people pay for fuel.