Nigerians on Monday were thrown off balance as Vice President Yemi Osinbajo announced Federal government plans to increase electricity tariff.
This announcement came at a time when most parts of the country are groping in darkness and erratic power supply.
Osinbajo dropped this major bombshell while speaking at the 6th Presidential Business Quarterly Forum for Private Sector at the Presidential Villa, Abuja.
His words: “Listening to questions concerning lower tariffs, we must pay higher tariffs, these sorts of things are inevitable. What we are trying to do is not increase electricity tariffs for now, but how we can ensure we clean up the entire value chain. I’m sure you are aware of the Payment Assurance Guarantee which we put in place for over N700billion to ensure gas is paid for and for liquidity in the whole value chain.
“Today, we will be meeting with the World Bank on a scheme they have been working with us on to fund the entire value chain, and ensure we transit smoothly from where we are, to a much more market-determined policy for electricity.
“This will involve a fair amount of subsidy and help the Federal Government and World Bank are working together on that.
“There is no way of sustaining the current subsidies long term, but we want to ensure the process is smooth.”
Osinbajo also noted that the nation was at a special moment in its journey to food security, saying: “We are in a special moment because the Federal Government has shown commitment towards agriculture and entire value chain. We have seen the enthusiasm of all the players, including the small farmers all across the country.
“Getting feedback concerning issues that have been raised, there is cheaper credit, and the President directed that we set up a small committee to look at the issue of intervention funds in agriculture.
“It is clear, that we are not able to bring down interest rates overnight, the way out is by some kind of intervention agreement.”