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Home » IS THEREANY ALTERNATIVE TO DEREGULATION

IS THEREANY ALTERNATIVE TO DEREGULATION

by Ade
October 26, 2009
in Uncategorized

Fidel Aisuodionoe (Petroleum dealer)
In my own opinion deregulation still remains the answer; the Nigerian business men who may be kicking against the idea of deregulation have their own reasons, the first reason is that these business men enjoy the subsidy paid by the federal government. They collect the product from the federal government plus the subsidy at reduced prices which are supposed to be sold at control price and they go ahead to sell above regulated price to Nigerians who for their sake, government provided the subsidy, and because government wants this subsidy to circulate throughout the country they have equally provided what we call petroleum equalization fund (PEF), this helps the transporter or the haulage company to bear the cost of haulage which means that if PMS is N65 in Lagos its supposed to be so everywhere.

We expect that the government will stand its ground, remove all subsidies, let the end users pay the value of the product and they should do everything possible to make the product available, that is the only way to break the cartel and stop scarcity. Government should now take what was being spent on subsidy and now channel it into other areas like power, if power becomes constant in Nigeria, the consumption level of AGO will reduce and once there is reduction the cost of production will reduce because factories that produce  today in Nigeria spend about 50 percent of their budget generating power.

Victor Anyanmele (Petrol marketer)
Deregulation is the perfect solution, because on the long run, the masses will be the beneficiaries.  Initially the  price might go up, but this is what will encourage private investors to come on stream and invest in our refineries, they will not want to lose their money because their ultimate goal will be to get the fuel available to the consumers so as to recoup their investments. We have been postponing it for a long time. If you take the AGO (diesel) for example you will see a lot of development in that business from those who have invested in it. And you know that AGO has been deregulated for a long time. Now you see many investors developing terminals, storage facilities, dispensing facilities and so on

Frank Kokori (NUPENG, ex- Sec. Gen.)
They said investors will not come in until you deregulate, that is too simplistic and pedestrian. In other words, you are not un government and you are not a leader because if you are a leader you cannot say that the oil industry will fall into the hands of some cabal, the solution is that government must always be there especially as Nigeria is a mono-product economy, to put checks and balances in every sphere of the economy. Nigeria is not yet ripe for an uncontrolled free market economy.

Oladipo Bolade (Licensed Customs Agent)
I don’t, in any way support deregulation, the truth is that it would have been easier if all our refineries are working perfectly, if you look at all these tank farms around and the people that constitute the cabal that are importing the petroleum product to the country, I am sure they will not want the refineries to work, and in as much as the refineries are not working; whether you deregulate or not, it will not end the problem we are facing. The best thing is to make sure that the refineries are working in perfect condition and if it is possible to actually discourage those people that constitute the cabal now so that at the end of the day, the common man can get the product at a very reasonable price.
Government should encourage private ownership of refineries so that when they buy the crude, they can now refine it and sell to us at appropriate prices and this will actually solve the problem because the prices will vary, like what is happening in the telecommunications now, Mr. ‘A’ will fix his price different from Mr. ‘B’ and everybody will be encouraged, look at when we use to have only DSTV in Nigeria look at the price, now that we have various once; there is what we call healthy competition, that is how the oil sector will be.

Ebele Odiaka (Stakeholder)
Our labour unions are only kicking against deregulation because some of them are being bribed out of the billions of naira budgeted yearly for the sector, meanwhile the NNPC, DPR and the rest of them just embezzle this money because we don’t see the use. Whether we are in support or not, the government will still go ahead with it if they want to, government have the power to do that. But, the refineries has to be working for it to favour us.

Tunde Salami (Teacher)
Deregulation of the downstream sector remains the best solution to the continuous crisis of interruptions and scarcity of petroleum products in this country. Our inability to operate functional refineries to meet local demands has exposed both marketers and consumers to the dynamics of international prices, because the bulk of products consumed are imported from the international market.
There is no need for us to pretend that all is well with the continuous regulation of the sector, especially in terms of the prices of products because asides Lagos and its environs, consumers in all other parts of the country are still buying at prices far above government regulated prices. I think we need deregulation; it is what the country requires, it takes away a lot of inefficiencies; it takes away a lot of wastages. It frees funds for government to do other development projects.

John Ojeis (PTD unit, NUPENG)
Before the deregulation can take place the refineries must be in perfect condition, it is only then that importation can be stopped; the argument of the labour is that the necessary things that ought to have been put in place are not there because if they are, there will not be sabotage of any form, people will now have to depend on the local content that we now have since there will not be importation again, by that the price will reduce and the product will be available once the refineries are working.

Now we have been able to achieve one thing in the Niger Delta which is the amnesty, all we have to do now is watch if it will bring in investors into the area, without this I don’t see anyway the deregulation can work, but I will agree that it is the best thing for the country if all the necessary things are put in place.  Instead of spending billions of naira on subsidy, if it is channelled into other areas like road construction and so on, it will cushion the effect of that deregulation on the people.

 


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