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Bank of industry

Posted by Editor One on 11th July 2016
The spiralling rise in the price of energy sources in Nigeria has become truly worrisome.  All within the space of a few months, the prices of petrol, diesel and kerosene as well as public electricity supply have experienced significant hike.
Petrol, which finds multiple usages within the economy, both as automotive oil and alternative source of energy by most small and medium-scale enterprises in the face of near non–existent public power supply, has increased in price from N86.5 per litre to N145. Kerosene, which is commonly referred to as the poor man’s fuel because of its major use by the very poor in society and people in the rural areas of the country, has gone up, where available, from about N120 per litre to over N300. Diesel, which predominantly finds its use in the industrial sector as an alternative to public power supply, currently trades at over N200 per litre from its N120 a few months ago. The case of domestic gas is not much different, as it currently trades at about 50 per cent of its retail price about two months ago.
These increases have obviously led to reduced domestic and industrial capacity occasioned by the reduced disposable income of both domestic and industrial consumers. But it would appear that the economic and social implications of this trend are lost on government.
The inability of small householders and other domestic users of kerosene and domestic gas should be of concern to the government because of its likely threat to the ecosystem. Primarily, users of these products are now being forced to use wood as an alternative. This not only fuels global warming but directly and negatively impacts the country’s afforestation campaign.
In view of the growing army of unemployed citizens, the government should also be concerned  about the social cost of the inability of small and medium enterprises as well as large industrial to operate maximally.
It is quite discomfiting that the government is thumping its chest about achieving a reduction in the consumption of Premium Motor Spirit by about 30 per cent at a time it should be more concerned about the long-term effects of its policies that have gradually brought on severe economic consequences. We believe that the government should have asked and sought answers to questions on the fundamentals that had brought on the astronomical reduction in the prices of these products.
Over time, the World Bank and other multi-lateral agencies had  established that the standard of living of residents of nations across the world is directly proportional to the amount and cost of energy available to them. By extension, the rising cost of access to a reasonable amount of energy at affordable prices at home and at work by Nigerians is sufficient evidence of worsening standard of living, as homes and offices are now forced to ration their energy use in view of lower disposable income.  It goes without saying that unemployment will increase with attendant negative social consequences. The government, too, will have to pay a huge price to  deal with these social consequences.
Worldwide, a prosperous economy is first known by the abundance of energy or otherwise that is available to its people. This is no rocket science
We believe that the time has come for the Nigerian government to roll up its sleeves and do the needful to empower the people by fixing the economy. This is no time to be heard talking about ‘something is being done;’ this is the time to see that something concrete is actually being done. This is the best time to quickly do something positive to avert the looming energy crisis. To ignore this warning is to prepare ground for an avoidable, yet costly, social crisis