Subsidy removal, FX reforms yielded N15.8tn in 30 months – FG

The Federal Government announced on Wednesday that the removal of petrol subsidies and implementation of foreign exchange market reforms generated N15.8tn in additional resources for Nigeria between June 2023 and December 2025. State and local governments received the larger portion of this amount. The government clarified that these savings did not appear as a separate line item in the Federation Account, but rather as increased revenue collections resulting from changes in the exchange rate and elimination of subsidy-related distortions.

Finance Minister Taiwo Oyedele explained that the N15.8tn was not deposited in the Federation Account under a designated "subsidy savings" heading. Instead, the combined impact of the petrol subsidy removal and foreign exchange reforms boosted the naira value of revenues earned by the Federation. He emphasized that the subsidy savings were not explicitly recorded in the Federation Account, but instead surfaced through higher revenue collections, such as increased customs collections and higher Petroleum Profit Tax revenue.

Oyedele also noted that the additional fiscal resources were not solely a result of the petrol subsidy removal, but also due to the removal of the implicit exchange rate subsidy.