Impacts of Fuel Subsidy on Economic Growth in Nigeria 2005–2022: Driving Economic Growth through Fuel Subsidy Removal Policy and Implementation

Abstract

This study aims to examine the impacts of fuel subsidies on economic growth in Nigeria from 2005 to 2022, driving economic growth through fuel subsidy removal policy and implementation. Fuel subsidies have long been a significant policy measure in the country, aimed at reducing the cost of fuel for consumers. The study analyzes and understands the economic consequences associated with the removal of fuel subsidies in Nigeria. An empirical research approach is utilized with a combination of quantitative data analysis and econometric modeling techniques. The primary focus of the analysis is on changes in key macroeconomic variables during fuel subsidies. The study explores the effects on government revenue, recurrent expenditure, capital expenditure, tax, inflation, exchange rate, technology, and GDP. The outcomes of this research include valuable insights into the impacts of fuel subsidies on economic growth in Nigeria. Findings from this study can inform policymakers, government agencies, and stakeholders about the potential consequences of subsidy reforms on the overall economy. Moreover, the results contribute to the ongoing policy discussions surrounding the removal of fuel subsidies and aid in the formulation of evidence-based strategies to ensure sustainable economic growth and development.