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Sanusi Lamido Sanusi Defends Subsidy Removal, Questions FX Policy Timing in Viral Remarks

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Promise Odejide

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Former Central Bank of Nigeria Governor and Emir of Kano, Sanusi Lamido Sanusi, has reignited national debate on fuel subsidy removal and foreign exchange reforms following a viral video where he reviewed Nigeria’s economic policies and their long-term impact.

His comments come amid rising concerns over inflation, living costs, and continued currency instability.

Defence of Subsidy Removal and Oil Sector Shift

In the widely circulated remarks, Sanusi maintained that the fuel subsidy regime was never sustainable and had long-term economic consequences.

“I have always said the subsidy regime was unsustainable. We cannot continue supporting foreign refineries. We’re an oil-producing country,” he said.

He argued that Nigeria’s earlier reliance on imported refined products weakened domestic capacity, stressing that recent changes in local refining mark a positive shift.

“Today, we have a situation where we have our own domestic refinery. We’re not importing petroleum products. We’re even exporting to Europe, and this is very good for the economy,” he added.

Warning on Exchange Rate Controls

Sanusi also turned attention to Nigeria’s exchange rate management, warning against artificial pricing systems that do not reflect real market conditions.

“Artificial exchange rates, especially when you’re printing money, cannot work. There was going to be a devaluation,” he said.

While backing both subsidy removal and exchange rate liberalisation, he questioned the sequencing of reforms and whether they were implemented at the right time.

“For me, removing subsidy or liberalising exchange rates, these are good interventions. Were they done at the right time? Those are certain questions,” he noted.

Debt Burden and Fiscal Pressure

The former apex bank chief pointed to Nigeria’s debt servicing burden as a key reason reforms became unavoidable.

“It’s not enough to say, oh, they removed subsidy. You had to. When you get to a point where 100% of your revenue goes into debt service, you cannot continue. Where is the money going to come from?” he asked.

He warned that policy reforms without proper monetary tightening could deepen economic pressure.

“However, if you decide to remove subsidy and liberalise exchange rates in an environment of very loose monetary conditions, before you have tightened money supply, the Naira drops to a bottomless pit. That was a timing issue,” he said.

Call for Fiscal Discipline

Sanusi also raised concerns about continued borrowing despite subsidy removal, urging stronger fiscal discipline from government.

“Secondly, we’ve removed the subsidy. We’re not spending it. What we should not see is fiscal consolidation,” he said.

“You cannot remove wastages and continue borrowing. If you’re not paying the subsidy and you’ve got the money, why are we still borrowing and borrowing? What are we borrowing for?” he added.

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