Monday, January 16, 2012


NLC betrayed Nigerians – Kayemo Ayodele Samuel, Lagos Major civil societies in the anti subsidy removal struggle which include the Joint Action Front (JAF) - the pro-labour civil society partner of the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) in the Labour and Civil Society Coalition (LASCO) and its allies of Nigeria Medical Association Lagos, Nigeria Bar Association Ikeja and Lagos, The Save Nigeria Group and the various Strike Action Committees yesterday dissociate themself from the declaration by the President of the NLC and TUC for the suspension of the Strike/Mass Action that commenced on January 9th saying were not consulted. JAF Secretary Comrade Abiodun Aremu in a statement said the suspension of the Strike/Mass Action as endorsed by Presidents of NLC and TUC as a betrayal of this legitimate demand by Nigerians that fuel price must revert to N65 as a condition for negotiation. He said the groups had resolved to intensify the struggle for the reversal to N65 and on other fundamental issues. “This was demonstrated with the street protest in Lagos today under the banner of JAF that was violently terminated at a point on Ikorodu road by the combined team of armed personnel that were deployed midnight across the country. “JAF reiterate its commitment to the needs and aspirations of the Nigerian people. Nigerians should not be discouraged by the abrupt and unwarranted suspension of strike by its Labour partner; neither should the militarisation of the protest centres deter Nigerians in their resolve to rid the polity of this class of looters and profiteers that are responsible for mass poverty, unemployment, social insecurity and untold hardships of the majority of Nigerians.” The Save Nigeria Group spokesman Yinka Odumakin told Peoples Daily last night that the group was not consulted before the action was taken “we are not in support of imposition of 97 on Nigerians, we are shocked by Labour action. “ We demand a reversal to the pre-Jan 1 pump price of N65 per litre as a basis for a conducive atmosphere for a national conversation on the oil sector and how to deal with the corruption that has brought this needless crisis on the 7th largest producer of crude in the world that has been made to depend on import for it's refined product consumption.” Also the Campaign for Democratic and Workers’ Rights (CDWR) said NLCagreeing to the N97 per litre when the working masses are still struggling for reversal to N65 per liter of fuel is a betrayal. CDWR Publicity Secretary Chinedu Bosah said The announcement by the TUC and NLC presidents, Peter Esele and Abdulwahed Omar respectively to the effect that they consulted with pro-people organizations/civil society organizations before agreeing to suspend the strike was a lie. “ It has shown that the labour leaders with an historical mandate to lead the suffering working masses of the country out of misery, oppression and dictatorship is shying away from this responsibility simply because they do not have an alternative socio-economic and political agenda different from neo-liberal capitalist policies.” He said the suspension of the strike by the NLC and TUC is not so much about compromise, which is not unconnected, but that these trade union centers lack the program, strategy and tactics to sustain the struggle, let alone win the struggle. Also Lagos based lawyer Festus Kayemo describe the NLC action as been unfair to Nigerians and a three step backward in the struggle to free Nigerians from the wasteful government. “It was too quick for labour to accept that position because the rot we are talking about went beyond 65 the issue is as a result of previous decay in the system, until we see have some action to address fundamental issues we should not accept the government offer”


Pastor ‘Tunde Bakare DEFINITION To subsidise is to sell a product below the cost of production. Since the federal government has been secretive about the state of our refineries and their production capacity, we will focus on importation rather than production. So, in essence, within the Nigerian Fuel Subsidy context, to subsidise is to sell petrol below the cost of importation. 2) THE UNSUBSTANTIATED CLAIMS OF THE FEDERAL GOVERNMENT The Nigerian government claims that Nigerians consume 34 million litres of petrol per day. The government has also said publicly that N141 per litre is the unsubsidised pump price of petrol imported into Nigeria. (N131.70 kobo being the landing price and N9.30 kobo being profit.) 3) ANNUAL COST OF IMPORTATION Daily Fuel Consumption: ​​34 million litres Cost at Pump: ​​​​N141.00 No. of days in a regular year: ​​365 days Total cost of all petrol imported yearly into Nigeria: Litres Naira Days 34m x 141 x 365 = N1.75 trillion 4) COST BORNE BY THE CONSUMERS Nigerians have been paying N65 per litre for fuel, haven’t we? Therefore, cost borne by the consumers = Litres Naira Days 34m x 65 x 365 = N807 billion 5) COST OF SUBSIDY BORNE BY THE GOVERNMENT In 2011 alone, government claimed to have spent N1.3 trillion by October – the bill for the full year, assuming a constant rate of consumption is N1.56 trillion. Consequently, the true cost of subsidy borne by the government is: Total cost of importation minus total borne by consumers, i.e. N1.75 trillion minus N807 billion = N943 billion. Unexplainable difference: N617 billion The federal government of Nigeria cannot explain the difference between the amount actually disbursed for subsidy and the cost borne by Nigerians (N1.56 trillion minus N943 billion = N617 billion). 6) BOGUS CLAIM BY THE GOVERNMENT A government official has claimed that the shortfall of N617 billion is what goes to subsidising our neighbours through smuggling. This is pathetic. But let us assume (assumption being the lowest level of knowledge) that the government is unable to protect our borders and checkmate the brisk smuggling going on. Even then, the figures still don’t add up. This is because even if 50% of the petrol consumed in each of our neighbouring countries is illegally exported from Nigeria, the figures are still inaccurate. Why? WORLD BANK’S FIGURES: POPULATIONS OF WEST AFRICAN COUNTRIES NIGERIA:​​158.4 million BENIN:​​8.8 million TOGO:​​6 million CAMEROUN:​19.2 million NIGER:​​15.5 million CHAD:​​11.2 million GHANA:​​24.4 million The total population of all our six (6) neighbours is 85.5 million. Let’s do some more arithmetic: a) Rate of Petrol Consumption in Nigeria: Total consumed divided by total population: 34 million litres divided by 158.8 million people = 0.21 litres per person per day. b) Rate of Petrol Consumption in all our 6 neighbouring countries, assumed to be the same as Nigeria: 0.2 litres x 85.5 million people = 18.35 million litres per day Now, if we assume that 50% of the petrol consumed in all the six neighbouring countries comes from Nigeria, this value come to 9.18 million litres per day. 1) PATHETIC ABSURDITY There are two illogicalities flowing from this smuggling saga. a) If 9.18 million litres of petrol is truly smuggled out of our borders per day, then ours is the most porous nation in the word. This is why: The biggest fuel tankers in Nigeria have a capacity of about 36,000 litres. To smuggle 9.18 million litres of fuel, you need 254 trucks. What our government is telling us is that 254 huge tankers pass through our borders every day and they cannot do anything about it. This is not just acute incompetence, but also a serious security challenge. For if the government cannot stop 254 tanker trailers from crossing the border daily, how can they stop importation of weapons or even invasion by a foreign country? b) 2nd illogicality: Even if we believe the government and assume that about 9.18 million litres is actually taken to our neighbours by way of smuggling every day, and all this is subsidised by the Nigerian government, the figures being touted as subsidy still don’t add up. This is why: Difference between pump price before and after subsidy removal = N141.00 – N65.00 = N76.00 Total spent on subsidizing petrol to our neighbours annually = N76.00 x 9.18 million litres x 365 days = N255 billion If you take the N255 billion away from the N617 billion shortfall that the government cannot explain, there is still a shortfall of N362 billion. The government still needs to tell us what/who is eating up this N362 billion ($2.26 billion USD). 1) ILLOGICAL ASSUMPTIONS i) We have assumed that there are no working refineries in Nigeria and so no local petrol production whatsoever – yet, there is, even if the refineries are working below capacity. ii) Nigeria actually consumes 34 million litres of petrol per day. Most experts disagree and give a figure between 20 and 25 million litres per day. Yet there is still an unexplainable shortfall even if we use the exaggerated figure of the government. iii) Ghana, Togo, Benin, Cameroun, Niger, and Chad all consume the same rate as Nigeria and get 50% of their petrol illegally from Nigeria through smuggling. These figures simply show the incompetence and insincerity of our government officials. This is pure banditry. 1) FACT 9: The simplest part of the fuel subsidy arithmetic will reveal one startling fact: That the government does not need to subsidise our petrol at all if we reject corruption and sleaze as a way of life. Check this out: a) NNPC crude oil allocation for local consumption = 400,000 barrels per day (from a total of 2.450 million barrels per day). b) If our refineries work at just 30%, 280,000 barrels can be sold on the international market, leaving the rest for local production. c) Money accruing to the federal government through NNPC on the sale, using $80/bbl – a conservative figure as against the current price of $100/bbl – would be $22.4m per day. Annually this translates to $8.176bn or N1.3 trillion. d) The government does not need to subsidise our petrol imports - at leastnot from the Federation Account. The same crude that should have been refined by NNPC is simply sold on the international market (since our refineries barely work) and the money is used to buy petrol. The 400,000 barrels per day given to NNPC for local consumption can either be refined by NNPC or sold to pay for imports. This absurdity called subsidy should be funded with this money, not the regular FGN budget. If the FGN uses it regular budget for subsidising petrol, then what happens to the crude oil given to NNPC for local refining that gets sold on the international market? 1) TACTICAL BLUNDER The federal government is making the deregulation issue a revenue problem. Nigerians are not against deregulation. We have seen deregulation in the telecom sector and Nigerians are better for it, as even the poor have access to telephones now right before the eyes of those who think it is not for them. What is happening presently is not deregulation but an all-time high fuel pump increase, unprecedented in the history of our nation by a government that has gone broke due to excessive and reckless spending largely on themselves. If the excesses of all the three tiers of government are seriously curbed, that would free enough money for infrastructural development without unduly punishing the poor citizens of this country. Let me just cite, in closing, the example of National Assembly excesses and misplaced spending as contained in the 2012 budget proposal: 1. Number of Senators​​​​​​109 2. Number of Members of the House of Representatives​​360 3. Total Number of Legislators​​​​​469 4. 2012 Budget Proposal for the National Assembly ​​N150 billion 5. Average Cost of Maintaining Each Member​​​N320 million 6. Average Cost of Maintaining Each Member in USD​​$2.1 million/year Time has come for the citizens of this country to hold the government accountable and demand the prosecution of those bleeding our nation to death. Until this government downsizes, cuts down its profligacy and leads by example in modesty and moderation, the poor people of this country will not and must not subsidise the excesses of the oil sector fat cats and the immorality cum fiscal scandal of the self-centred and indulgent lifestyles of those in government. Here is a hidden treasure of wisdom for those in power while there is still time to make amends: PROVERBS 21:6&7 “Getting treasures by a lying tongue is the fleeting fantasy of those who seek death. The violence of the wicked will destroy them because they refuse to do just.” A word of counsel for those who voted for such soulishly indulgent leadership: “Never trust a man who once had no shoes, or you may end up losing your legs.” This is the conclusion of the matter on subsidy removal: i) “If a ruler pays attention to lies, all his servants become wicked.”(Proverbs 29:12) ii) “The Righteous God wisely considers the house of the wicked, overthrowing the wicked for their wickedness. Whoever shuts his ears to the cry of the poor will also cry himself and will not be heard.” (Proverbs 21:12&13) Thanks for your attention. God bless you all. Pastor ‘Tunde Bakare Sunday, January 15, 2012


By Ayodele SAMUEL in Lagos and Ablawa BOKO in Cotonou The price of gasoline adulterated commonly called “kpayo” tripled in Republic of Benin following price increase in neighboring Nigeria . The kpayo (the fuel sold in informal sector brought from Nigeria to Benin ) sold usually between 250 and 300 francs (Cfa) per liter, increased to 400 francs on Saturday. Since then, the price of gasoline has climbed. Currently, it is sold at 700 francs per liter. “At the wholesale level, the container purchased 8000 CFA before, is sold today to retailers at 14,000 CFA francs”, said Razack, selling fuel in Cotonou . Within days, the price of kpayo has soared across Benin . This has an effect on people whose main source of fuel is the informal sector. The shortage was related to the recent increase in PMS in border country Nigeria . "Every increase in pump price in Nigeria affects , the distribution of kpayo knows some disruption." said Ernest, fuel seller at Gbégamey ( Cotonou ). Raphael, a client, is surprised that this has lasted as long. "Usually, this crisis comes at the holiday season, and just after, the trend is the opposite," he said. Except that this year, the crisis seems very deep and there are many reasons to worry. The removal of subsidies on fuel prices in Nigeria is the cause. THE GIANT OF AFRICA COUGHS, BENIN CATCHES COLD The Nigerian government announcement on last Sunday has resulted in increase prices at the pump. Nigeria is the first oil producer in West Africa and the only supplier of fuel to the biggest sector of fuel selling in Benin , the informal sector. Because of the removal of subsidies on fuel prices and this oil crisis in Nigeria , the customer begins to feel it very difficult to get fuel. The sellers are speculative and prices vary from one seller to another. Some sellers of kpayo had to store their tables and bottles to engage in other activities. In the ranks of motorcycle taxi drivers called “Zémidjan”, prices are revised upwards. For a distance, a week ago to 100 CFA francs, now it costs more and sometimes twice. The price of travel from one place to another have also increased. Taxi drivers in the international destination of Burkina Faso , Cote d'Ivoire and Togo have also revised their tariff. Some have parked their cars and waiting for the return of the situation to normal. Traffic is more fluid. Clients reconnect with products Sonacop A 800 Francs per liter, the kpayo is very expensive, more expensive than the pump. " The sellers of adulterated gasoline stormed the stations where they refueled to go sell it. Note also that the stations were not prepared for such a crowd" left hear a station manager of the place. According to Ernest, the kpayo was firmly rooted in the habits in Benin . It's like a reflex, people do not ask too many questions. For this purpose they are hopeful that the crisis will be resolved very quickly. Otherwise, the purchasing power of the Benin risks becoming weak. " With a few differences, prices at the stations of Sonacop (national society of marketing of petroleum products) are currently below than those charged by sellers of kpayo. In Sonacop stations, gasoline is sold at 570 FCFA. The rush to these places begins to increase and once daily sales begin to improve. Some students were forced to park their bike at home. They prefer to walk or seek the services of their comrade. SUBSIDIES PRODUCT FROM NIGERIA FIND ITS WAY TO BENIN Large quantity of Nigeria’s PMS are daily smuggled into the Republic of Benin through its Badagry/ Seme porous border after the Nigeria government has subsidies the product for its citizen. In spite of the removal of petrol subsidy by the Federal Government, smuggling of the product into neighboring Benin Republic persists because of price differential. The border towns of Owode and Kpogidi in the Seme-Badagry area of Lagos state, showed that though the removal of the subsidy has increased the price per litre in Nigeria to about N140, the same litre was N250, officially, in Benin Republic . Though the black market price of a litre of smuggled Nigeria petrol in Benin Republic has been increased to N200, it was still cheaper than buying from filling stations there at N250. Until the January 1 deregulation which raised the pump price of petrol from N65 to about N140, smuggled Nigeria petrol was sold at N100 per litre in Benin Republic, while it was N200 a litre at the filling stations in the Francophone country. Residents of Kpogidi (a border town )hardly patronised the filling stations that sold at the official pump price of N250 per litre. the Central Bank of Nigeria (CBN) Governor, Sanusi Lamido had said most of the products claimed to have been imported found their way to neighbouring countries through unscrupulous marketers. For further information on this report contact, Ayodele Samuel in Lagos , Nigeria is a reporter with Peoples Daily Newspaper could be contact on Ablawa BOKO in Cotonou , Republic of Benin , is a reporter with Tamtam-afrik newspapers: contact address nadbok@yahoo.fra