EFFECT OF FUEL SUBSIDY REMOVAL ON PURCHASE OF CONSUMER GOODS IN NIGERIA: A LITERATURE REVIEW

Abstract

The fuel subsidy removal in Nigeria has been a very controversial issue. While some experts believe that it will lead to increased poverty, others are of the opinion that it will liberate the much needed resources needed to develop other sectors of the economy. This study examines the implications of fuel subsidies removal on Nigeria’s economic development. The study adopts exploratory research design and qualitative method to collect data, analysed via content analysis. Findings reveal amongst others that removal of fuel subsidy in Nigeria will have direct economic consequences including increase in product prices, hike in fuel pump prices and quality of petroleum products amongst others. The authors concludes that the higher the pump price of fuel, the higher will be the cost of consumer products purchased as fuel plays an important role in the production of goods and services in all sectors of the economy.