When it was announced that Nigeria would fully deregulate its downstream petroleum sector, I wrote: ‘“You need to see to believe… Yes, I do not believe this policy or initiative…” Partly, the agency that put the press release was the agency that was created to regulate the sector. In that press release, the Executive Secretary of Petroleum Products Pricing Regulatory Agency (PPPRA), Abdulkadir Saidu, did not say he was resigning or disbanding/downsizing the agency. So, how can petrol prices be unregulated when the regulator is still fully operational? Of course, even fully deregulated markets have regulators (example, NCC for telecoms). Yet, at least PPPRA would have noted how many people it was firing for reduced activities. That did not happen, and many of us did not believe the government in the long-term.
Just as expected, indeed the PPPRA is not going out of business. It has clarified that nothing has really changed. No full deregulation!
The Petroleum Products Pricing Regulatory Agency (PPPRA) has made a U-turn on its decision to allow marketers to fix petroleum products prices as indicated by market forces. The Regulatory Agency had a few days ago published a document containing the government’s decision to partially deregulate the downstream sector.
On Saturday, the PPPRA said it would not allow petroleum products marketers to fix prices, although its role will be to advise and recommend prices that will serve as a guide to marketers.
The statement signed by the Executive Secretary of PPPRA, Abdulkadir Saidu, confirmed that the Nigerian government has deregulated the market, but added that it does not excuse the role of the Agency as the Regulator.
“Suffice to say that in a deregulated market, the role of a Regulator in monitoring and regulating activities in the sector cannot be over-emphasized,” he said.
That is the Nigerian problem: interests. How do you expect a big man or woman to disarm in Nigeria? This is why a national leader shapes the destinies of nations. Many do know the right thing to do but cannot because of self-interests. So, you have to make the calls for them!
This agency has shown that even though it may still be useful to provide guidance on a full deregulated market, it may not have to run at 100% current capacity. Yes, less than 30% of the current manpower may be needed for the post-deregulation regime. But for that to happen, it means the Executive Secretary will reduce this agency budget which will be like a poison pill. That does not happen in Nigeria. And because of that, no deregulation as self-interests will always win.---