Currency Devaluation and Fuel Subsidy Removal for Nigeria’s Economic Development

Abstract

Currency devaluation and fuel subsidy removal are policies that are phenomena to the Nigerian economic environment. The implementation of the policies has further caused more challenges in the pursuit for economic development than remedy to alleviate the crisis in the Nigeria economy. However, the continuous exploration of this policies by successive administration was a concern to this research work. It is as a result of this persistent policies that this paper wants to analyse its viability for economic development in Nigeria.

The paper adopted survey research design with the use of questionnaire administered to 387 respondents. Three major organizations were purposefully selected as sources for data collection which were the Central Bank of Nigeria (CBN), National Petroleum Corporation (NNPC) and the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG).

The paper found out that currency devaluation and fuel subsidy removal is a resultant effect of the mono-productive characteristics of the Nigerian economy which has continually led to balance of payment deficit, low competitiveness in the economy and fall short in living quality of the citizenry. Further exposition revealed that not until diversification of the economy is attained, revitalization of the power sector and industrialization for local manufacturing; economic development might not be feasible. Therefore, it is recommended that industrialization of the economy is highly overdue, infrastructural development imperative and economic policies such as devaluation and subsidy regime should be mildly used when economic downturns are experienced.