'Small businesses will crumble completely' - Business operators lament hardship as fuel sells for N617/litre

Business operators in Nigeria are lamenting the spate of increases in cost occasioned by the sudden hike in fuel prices in the country.

This is coming after the Nigerian National Petroleum Company Limited adjusted its pump price of Premium Motor Spirit, popularly called petrol, from N537/litre to N617/litre.

The adjustments were spotted in some filling stations in Abuja on Tuesday, July 17, 2023, and it is expected that the new prices will be implemented across the country.

Operators express frustration

Francis Meshioye, president of the Manufacturers Association of Nigeria, commented on the situation and warned that the unpredictable nature of fuel price increases would have a significant negative impact on manufacturers, who have had to reevaluate their budgets to account for the additional expenses brought on by the loss of fuel subsidy.

He claimed the recent increase would add to the logistics expense, which had already increased due to fuel prices.

He said that given the trend, manufacturers were concerned that this might not be the final rise, and he encouraged the government to create a culture involving important stakeholders before making choices with broad-reaching effects like this.

When the fuel subsidy was eliminated, Meshioye said most people believed the change would only be temporary as no one anticipated it would be drastic.

The hike in gasoline prices, according to Gabriel Idahosa, Deputy President of the Lagos Chamber of Commerce and Industry, will cause great hardship for businesses, particularly in the near future.

Idahosa said: In the near term, there will be a lot of hardship. A lot of small businesses will crumble completely. There will be a drop in production capacity. How fast we can get out of it is what the conversation is about now.

Femi Egbesola, president of the Association of Small Business Owners of Nigeria, voiced concern that more companies will fail due to the harsher working climate.

He claimed that raising the petrol price at the pump when small businesses were already struggling due to the recent elimination of fuel subsidies was a "sledgehammer" that would destroy numerous SMEs.

Segun Kuti-George, national vice president of the Nigerian Association of Small-Scale Industrialists, said that the move would put additional pressure on companies already dealing with rising prices brought on by the government's recent economic changes.