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The Group Managing Director, Afrinvest, Ike Chioke, has said the Federal Government needs to remove the subsidy on electricity to complete its cost-cutting moves.
This was disclosed at the Half year investment parley of the investment firm in Lagos on Tuesday.
A new report by the Nigerian Electricity Regulatory Commission showed that government spending on electricity subsidy had risen to N2.8tn as of December 2022.
Chioke said that while the removal of the electricity subsidy would push the inflation figures higher, he hoped that the savings made would be put to use to ameliorate the sufferings of poor Nigerians.
He said, “There is still one more subsidy element that the government needs to tackle and that is electricity subsidy. We see that will likely push inflation from 23 per cent up to 24 per cent towards the end of the third quarter of the year before we can then see inflation being reined in. But most of this would depend on the policy direction of the new government.”
Speaking on the outlook for the rest of the year, Chioke said, “In the fixed-income market, you see a lot of volatility but volatility is good if you are an active trader. In the equity market, we have seen a significant correction in the market.
“It is up by over 20 per cent from when President Tinubu came in but you have to be selective because there have been windows of profit-taking that put pressure on the market.
Peoplesmind
