Fuel Price Hike: NACCIMA Warns of Economic Fallout, Industry Closures

Samuel Mobolaji

The President of Nigerian Association of Chamber of Commerce, Industry, Mines and Agriculture (NACCIMA), Dele Kelvin Oye, has kicked against fresh hike in price of fuel.

This is even as he noted that the new increment will affect real sector and lead to closure of more industries that have been struggling to survive the hard business environment.

In his reaction to the fresh increment, Oye said: “The fresh increase in petrol pump prices to N998 per litre in Lagos and N1030 per litre in Abuja poses significant implications for both businesses and households in Nigeria.

This decision, influenced by several underlying factors, warrants careful examination of its potential repercussions on our economy, particularly in the realms of pricing for goods and services and transportation.

With transportation costs directly tied to fuel prices, this increase will serve as a catalyst for higher freight charges.

Noting that the price hikes will invariably filter down through the supply chain, leading to an increase in costs for consumers across various sectors, he noted that foodstuff, household essentials, and all other goods will become pricier, severely impacting household budgets and straining purchasing power.

Oye claimed that, since fuel is a primary driver of inflation, the rise in petrol prices will exacerbate the already high inflation rate in Nigeria. Households will find themselves paying more not only for fuel but also for everyday goods and services, prompting a vicious cycle of rising costs and economic hardship.

He said the hike will have effects on businesses and Small and Medium Enterprises (SMEs) since they depend on use of fuel and diesel to power their machines.

He reminded federal government that as Nigeria is home to over 41.5 million micro enterprises, which constitute 99.8 per cent of all businesses in the country.

“These small-scale businesses are already grappling with challenges such as poor power supply and rising operational costs. The surge in petrol prices will further strain their already meagre resources,” he pointed out.