…Calls For Oil Price Stabilisation Amid Escalating Middle East Tensions
The Minister of State for Finance–designate, Mr Taiwo Oyedele, has raised concerns over what he described as a misalignment between Nigeria’s fiscal policies and the country’s industrialisation and import substitution objectives.
Speaking on Wednesday in Abuja during his screening by the Senate, Oyedele said the current fiscal framework has continued to constrain domestic production, particularly in the manufacturing sector, as imported goods often arrive cheaper than locally produced alternatives.
According to him, recent engagements with the leadership of the Manufacturers Association of Nigeria (MAN) highlighted the extent of the policy gap.
“I spent quite some time with the leadership of MAN a few days ago and it became clear that there is a misalignment between Nigeria’s fiscal policies and the goal of industrialisation,” he told the lawmakers.
He explained that the prevailing policy structure discourages local manufacturing by allowing imports to compete more favourably with locally produced goods.
Oyedele also warned that the ongoing conflict in the Middle East could heighten inflationary pressures in Nigeria through rising energy costs.
He noted that escalating tensions in the region are already pushing up global petrol prices, with potential ripple effects across the domestic economy.
According to him, the Federal Government should consider introducing a price stabilisation mechanism to cushion the impact of volatile energy costs on consumers and businesses.
He explained that increases in fuel prices typically trigger higher costs for goods and services, but such prices rarely decline even when fuel prices later stabilise.
“The war in the Middle East is triggering an increase in petrol prices in Nigeria and many other countries on an hourly basis, with serious implications for purchasing power,” he said.
Oyedele further described the country’s revenue profile as “fragile,” noting that Nigeria must diversify its revenue sources beyond oil.
He identified the solid minerals sector as a major area with untapped potential for revenue generation but lamented that policy inconsistency has hindered its development.
According to him, the absence of clear and stable legislation regulating mining activities has prevented Nigeria from fully harnessing the sector’s economic benefits.
He drew parallels with the Liquefied Natural Gas (LNG) industry, which initially suffered from policy uncertainties that discouraged investors.
“However, once the right legislation was enacted by the National Assembly, the LNG sector became a success story.
“If we can fix the policy framework in the solid minerals sector, we will get there,” he said.
The tax expert he would work closely with the National Assembly to strengthen the legal framework governing the sector and unlock its investment potential.
On fiscal management, Oyedele criticised Nigeria’s heavy reliance on public sector–driven economic activities, although he acknowledged that the current administration is gradually steering the economy towards a more private sector–led model.
Addressing concerns over poor budget implementation, particularly the capital component, he attributed the problem largely to unrealistic revenue projections.
“Nigeria’s budgets over the last five years have been too ambitious relative to available resources. There is a need for more realistic revenue projections and a more effective cash management system,” he said.
On the economic hardship facing Nigerians, Oyedele argued that the removal of fuel subsidy effectively meant that government had taken resources previously enjoyed by citizens.
He therefore stressed that the savings from subsidy removal must be channelled into visible public investments such as road infrastructure, healthcare delivery and other social services.
He also cautioned Ministries, Departments and Agencies (MDAs) against awarding contracts without secured funding, noting that the growing backlog of unpaid contractors has become a major fiscal concern.
According to him, public expectations in key sectors such as education, healthcare and infrastructure continue to rise despite limited government revenues.
“The Nigerian economy has not been able to generate the level of revenue required to meet many of the government’s critical obligations,” he said.
Oyedele also disclosed that Nigeria’s per capita income stood at less than $130 in 2025, significantly lower than levels recorded in several African economies, including Algeria and South Africa.
He, however, expressed optimism that ongoing policy reforms by the Federal Government could lay the foundation for stronger economic growth and long-term development.
