January 4, 2012 / 7:01 AM / 8 years ago

Nigerian unions call for fuel subsidy strike, protest

ABUJA (Reuters) - Nigerian trade unions on Wednesday called for a national strike and mass demonstrations to shut down oil production and other sectors starting on Monday unless the government restores a fuel subsidy it scrapped this week.

Protesters shout slogans during a rally against fuel subsidy removal on Ikorodu road in Nigeria's commercial capital Lagos January 3, 2012. Hundreds of demonstrators in Nigeria's commercial capital Lagos shut petrol stations, formed human barriers along motorways and hijacked buses on Tuesday in protest against the shock doubling of fuel prices after a government subsidy was removed. REUTERS/Akintunde Akinleye

“All offices, oil production centres, air and sea ports, fuel stations, markets, banks, among others will be shut down,” the National Labour Congress and Trades Union Congress said in a joint statement.

The elimination of the popular fuel subsidy caused the price of petrol to double overnight and sparked protests across the oil-rich country.

The trade unions said that if the government failed to restore the subsidy, they would direct “that indefinite general strikes, mass rallies and street protests be held across the country with the first on Monday, 9th January.”

The government’s fuel regulator announced the end of the subsidy on Sunday under sweeping economic reforms meant to improve fiscal discipline in Africa’s biggest oil-producer, a move seen as likely to trigger social unrest.

Most Nigerians see the subsidy as the only benefit they derive from living in a country with vast oil deposits, which nevertheless has to import most of its refined petroleum at great cost to the Treasury.

The subsidy removal is part of efforts to cut Nigeria’s exorbitant cost of government, a flagship policy of President Goodluck Jonathan and his economic team, alongside fixing the broken power sector and making ports more efficient.

Thousands of protesters took over the main square of the northern city of Kano on Wednesday, chanting slogans against the elimination of the subsidy.

“We will not leave here. We are ready to bear our cross,” protester Ibrahim Adamu told Reuters in central Kano. “Jonathan should understand it is the people’s mandate he is toying with. We won’t move an inch from here unless the subsidy removal is reversed.”

“BOLDEST MOVE YET”

On Tuesday, protesters shut petrol stations, formed human barriers along motorways and hijacked buses in Nigeria’s biggest city Lagos in anger at the shock doubling of fuel prices. One demonstrator was reported shot dead in the country’s west.

Protests also occurred in other parts of Nigeria on Tuesday, including the Niger Delta in the southeast and in Ilorin, Kwara State, in the west, where the Nigerian Labour Congress (NLC) said one man was shot dead, but police did not confirm this.

Economists say the subsidy filled the fuel tanks of middle-class motorists at the expense of the poor, encouraged corruption and waste, and handed over billions of dollars of government cash to a cartel of wealthy fuel importers.

“Nigeria’s government has made its boldest move yet by abolishing the fuel subsidy,” Renaissance Capital said in a note on Wednesday. “The subsidy is widely believed to have benefited the wealthier (who own cars), encouraged corruption, discouraged investment in refineries and encouraged smuggling abroad.”

But removing it pushed pump prices to 150 naira per litre from 65 naira.

“Look at my fuel tank,” said taxi driver David John, pointing at a half-full fuel metre in his green Toyota Camry. “That was 3,500 naira. Last week that was enough to fill the whole tank.”

The government estimates it will save 1 trillion naira this year with the elimination of the subsidy.

The International Monetary Fund, which periodically criticises Nigeria for its wasteful use of public money, has backed the move.

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