LAGOS - Nigeria's new president Bola Tinubu on Monday urged Nigerians to accept more sacrifice in return for later investments after his government ended a long-standing fuel subsidy in a measure that has spiked petrol, transport and food prices.
Elected in February in a highly contested vote, Tinubu in his first day in office last month called for an end to the fuel subsidy that costs the government billions of dollars to keep consumer prices of petrol artificially low.
Nigeria is one of Africa's biggest oil producers but has little refining capacity.
For decades, it has swapped crude for gasoline that it then subsidises, causing a huge drain on revenue, foreign exchange and contributing to growing debt.
Tinubu's decision has seen petrol prices triple, triggering a spike in transport costs as well as a knock-on impact on food prices and electricity for the many Nigerians who use petrol-run generators for power.
In a national broadcast for Nigeria's Democracy Day, Tinubu said the end of the subsidies was a painful necessity for the country's economic well-being.
"Painfully, I have asked you, my compatriots, to sacrifice a little more for the survival of our country. For your trust and belief in us, I assure you that your sacrifice shall not be in vain," he said.
"The government I lead will repay you through massive investment in transportation infrastructure, education, regular power supply, healthcare and other public utilities."
Although the country is Africa's largest economy, Nigerians already face inflation of around 20 percent, intermittent fuel shortages and a fragile national power supply that forces people to rely on generators for light or sometimes go hours without power if they cannot afford one.
Experts say the removal of subsidies was long needed, but critics say the government has not done enough to put in place measures to counter the inflationary impact.
Soon after the end of subsidies, petrol prices rose from 190 naira per litre to about 540 naira ($1.20) per litre.
Last week, Tinubu's government also fired the central bank chief who was later arrested by the DSS domestic security and intelligence service as part of an investigation into his role.
Central Bank of Nigeria director Godwin Emefiele had been under fire for carrying out former president Muhammadu Buhari's cash swap policy that had caused an acute shortage of physical naira cash earlier this year.
He was also seen by critics as the architect of Buhari's unorthodox multiple currency exchange system, tight controls on access to foreign currency and government debt programme.
Tinubu, a former Lagos governor and businessman, criticised the current bank in his inaugural address at the end of last month, suggesting monetary policy needed "a thorough housecleaning" and demanded the bank push a unified exchange rate to help investment.