Many oil-producing countries have long maintained domestic fuel subsidies, even as the fiscal cost has ballooned, for fear of triggering civil unrest. But Nigerian President Bola Tinubu’s decision to take a “cold turkey” approach to ending his country’s subsidies, and the lack of popular resistance to the move, suggests a way forward.
WASHINGTON, DC/ABUJA – In his inauguration speech in May, Nigerian President Bola Tinubu announced the end of the country’s decades-old fuel subsidy. This is not the first time that Nigeria has attempted to abandon the policy, which has had disastrous consequences for the economy and the climate. What is new is the quiescence of ordinary citizens. After declaring plans for a nationwide strike, the Nigeria Labour Congress backed down, and no other large protests have erupted.
It was an unusual response, to say the least, given that steep fuel-price increases often lead to riots. When then-President Goodluck Jonathan attempted to scrap Nigeria’s fuel subsidy in 2012, widespread demonstrations and a nationwide strike forced him to reverse course. Likewise, violent protests compelled former Ecuadorian President Lenín Moreno to reinstate fuel subsidies shortly after he repealed them in 2019. According to the BBC, people in more than 90 countries took to the streets over the cost or availability of fuel between January and September 2022.
To avoid civil unrest, the International Monetary Fund advocates a gradual phase-out of fuel subsidies coupled with targeted measures to protect the most vulnerable. But when governments lack experience with implementing social safety-net programs, citizens often will lack faith in the transition and show greater resistance to reform.
WASHINGTON, DC/ABUJA – In his inauguration speech in May, Nigerian President Bola Tinubu announced the end of the country’s decades-old fuel subsidy. This is not the first time that Nigeria has attempted to abandon the policy, which has had disastrous consequences for the economy and the climate. What is new is the quiescence of ordinary citizens. After declaring plans for a nationwide strike, the Nigeria Labour Congress backed down, and no other large protests have erupted.
It was an unusual response, to say the least, given that steep fuel-price increases often lead to riots. When then-President Goodluck Jonathan attempted to scrap Nigeria’s fuel subsidy in 2012, widespread demonstrations and a nationwide strike forced him to reverse course. Likewise, violent protests compelled former Ecuadorian President Lenín Moreno to reinstate fuel subsidies shortly after he repealed them in 2019. According to the BBC, people in more than 90 countries took to the streets over the cost or availability of fuel between January and September 2022.
To avoid civil unrest, the International Monetary Fund advocates a gradual phase-out of fuel subsidies coupled with targeted measures to protect the most vulnerable. But when governments lack experience with implementing social safety-net programs, citizens often will lack faith in the transition and show greater resistance to reform.