Muhammad Sanusi II, Emir of Kano and former governor of the Central Bank of Nigeria (CBN), has said that eliminating the petrol subsidy was what shielded Nigeria from bankruptcy.
Speaking on Saturday at the second edition of the Kano International Poetry Festival (KAPFEST), organised by the Poetic Wednesdays Initiative, Sanusi described the subsidy regime as unsustainable, stressing that it forced the government to absorb the burden of volatile global oil prices, exchange rate fluctuations, transportation costs, and refining expenses.
“Subsidy was simply the government saying, ‘If the price of petrol is N100, Nigerians will pay N70 and I will pay N30,’” he explained.
“But beyond that, the government also placed a hedge—fixing petrol at N65 per litre irrespective of whether the international price of oil was $10 or $100 per barrel. Who paid the difference? The government. And this was always going to bankrupt Nigeria.”
Sanusi criticised successive governments for failing to revive local refineries, noting that subsidies only enriched foreign refiners while depriving Nigerians of employment opportunities.
“If you look at the billions and billions spent on subsidy and imagine that money invested in refineries, Nigeria would not be where it is today,” he said.
“I have nothing against subsidies if you are subsidising production. My objection has always been subsidy on consumption.”
Reflecting on his time as CBN governor in 2012, the emir recalled warning against sustaining subsidies, likening Nigeria’s direction then to “a man running towards a ditch.”
“Government revenue could no longer carry the subsidy burden. At some point, we began borrowing to pay the subsidy, then borrowing to service the debt. It became unsustainable. That is exactly what I said would happen, and this is where we are,” he added.
He further emphasised that the subsidy removal should not only be viewed as an economic correction but also as a chance to rebuild Nigeria into a stronger and more self-reliant nation.