By Firdaus Jibril
The Federal Government has stated that it will publish a detailed breakdown of how savings from the removal of fuel and foreign exchange subsidies have been spent, following growing public concern over the utilization of the funds.
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Thursday while speaking at the 7th Africa Emerging Markets Forum in Abuja.
Responding to concerns over whether the gains from the government’s economic reforms were translating into improved living conditions, Oyedele said Nigerians were justified in asking how the savings from the subsidy reforms had been utilized.
“There was a question about the subsidy savings: ‘Where has it gone to?’ I’ve heard this question so many times. And guess what? It’s a valid question,” he said.
According to the minister, the removal of fuel subsidies and foreign exchange subsidies generated savings estimated at about five percent of the country’s Gross Domestic Product (GDP).
He explained that the reforms were introduced to correct long-standing distortions in the economy rather than simply create additional funds for government spending.
Oyedele said part of the savings had been absorbed by higher debt-servicing costs arising from increased interest rates, while other funds had been used to support the implementation of the new ₦70,000 national minimum wage and expanded social intervention programs.
He added that the Nigerian Education Loan Fund (NELFUND) had also benefited from the reforms, noting that more than 1.5 million students had received tuition support and monthly stipends.
The Minister also defended the government’s decision to continue borrowing despite improved revenue generation, saying higher revenue does not eliminate the need for borrowing when public expenditure exceeds income.
According to him, borrowing remains sustainable if it is channeled into investments capable of generating returns above the cost of the loans.
Oyedele rejected suggestions that the reforms had worsened poverty, arguing that current economic challenges were part of the adjustments required to correct structural imbalances.
He said the government’s focus is now on translating macroeconomic stability into increased productivity, job creation, and broader economic growth.
The Minister further disclosed that the Federal Government is working on measures to reduce the cost of capital without introducing new subsidies, saying the initiative would complement the Central Bank of Nigeria’s efforts to curb inflation while encouraging investment in productive sectors of the economy.