A Review of the Nigerian Energy Industry

NECA asks govt to revisit deregulation of the downstream petroleum sector

Fuel-dispencer20 July 2014, Lagos – The Nigeria Employers’ Consultative Association, NECA, has called on the federal government to revisit the issue of deregulation of the downstream petroleum sector after the 2015 general election.

President of NECA, Chief Richard Uche who made the call at the 57th Annual General Meeting of NECA in Lagos, described as economic waste government’s continued involvement in the running of the refineries.

He argued that it was not economically justifiable for the country to continue to depend on fuel importation, stressing that the current policy of fuel subsidy portends grave danger for the future health of the economy.

“While we acknowledge the fact that it might not be politically expedient in an election year for the government to fully deregulate and privatise the downstream sector of the oil and gas industry, current policy of fuel subsidy portends grave danger for the future health of our economy.

“It is certainly not sustainable in the long-term, neither is it sufficient and effective for the overall development of the Nigerian economy.

He added: “We are therefore, hopeful that after the 2015 general elections, the federal government win bring this issue back to the front burner. It is, indeed, imperative for the government to create an enabling business environment where local refineries will sprout and flourish in order to put an end to an anemic dispensation of fuel subsidy and fuel importation.”

Speaking further, the outgoing president of NECA urged the federal government to set machinery in motion for the immediate implementation of the Oronsanye report which recommended the rationalisation of ministries, departments and agencies (MDAs) of the government.

He insisted that government must brush off what he called “ongoing lobbying” to stop the implementation of the Oronsanya committee recommendations, insisting that as observed in the report there are too many MDAs in the country with overlapping functions.

He maintained that rationalising the MDAs would significantly reduce government recurrent expenditure thereby freeing funds for capital developments.

“We commend the government for accepting to implement the report, albeit partially. The fact, however, remains that there too many government MDAs with overlapping responsibilities and the right thing to do is to rationalise the roles and responsibilities of these MDAs through integration, merger and in some instance, outright scrapping.

We therefore advise the government to quickly move to the next stage of the implementation in spite of the lobbying and opposition, which is being driven by narrow stakeholders’ interest. We believe this will significantly reduce government’s recurrent expenditure,” he said.

The NECA president who also spoke about the continuing infrastructural deficit, power failure, and their impact on national productivity, despite the privatisation of the power sector, said the government needed to do more in these key sectors of the economy.

Uche decried the overbearing regulatory roles of some government regulatory agencies, noting that “most of them have elevated themselves to the level of kings whose words cannot be questioned.”

He added: “Oftentimes they shun dialogues with private sector and on some occasions, have been ruthless by shutting the gates of companies that refuse to give-in to their untoward actions and requests. We appeal to the government to call the agencies to order because they are killing local businesses and smearing Nigerian public image as an unfriendly investors’ destination.”


– This Day

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