The Nigeria Labour Congress (NLC) has criticised the International Monetary Fund (IMF) for denying its role in advising the Nigerian government to remove subsidies on petrol. The removal, implemented by President Bola Tinubu in May 2023, led to a dramatic increase in the price of Premium Motor Spirit (PMS), rising from N175 per litre to between N1,000 and N1,200 in Lagos, with prices reaching N1,300 in northern states.

The subsidy removal has triggered widespread inflation and rising living costs, drawing criticism from various sectors. In a statement on Sunday, NLC President Joe Ajaero claimed that IMF recommendations have led to increased socioeconomic hardships and stagnation in Nigeria.

This response came after IMF African Region Director, Abebe Selassie, stated during the IMF and World Bank Annual Meetings in Washington, DC, that the Nigerian government’s decision to remove the subsidy was a domestic one.

“The IMF’s recent statement evades responsibility by claiming Nigeria’s subsidy removal was a ‘domestic decision,’ while overlooking its influence on policy-making in developing nations. Although denying direct involvement, the IMF frequently advocates for subsidy cuts as essential for fiscal sustainability, making this disavowal appear insincere in a country often compliant with such recommendations,” the NLC’s statement said.

The NLC expressed concern over the IMF’s stance, viewing it as indicative of the restrictive policies imposed on Nigeria by the IMF and World Bank.

“The IMF appears to be distancing itself from potential backlash, but Nigerians are not naïve; we are aware of the adverse impacts these strategies have had on Nigeria and Africa,” the union stated.

The NLC also noted that while the IMF acknowledges “significant social costs” related to subsidy cuts, its recommendation to counter these hardships with social protections, such as the Rice Initiative, often leaves citizens reliant on inadequate handouts.

In Nigeria, subsidy removal and escalating prices have rendered essential goods unaffordable, while government safety nets remain insufficient. The NLC asserted that the IMF’s refusal to acknowledge its role in these policies reflects a major disconnect in its economic strategy.

Furthermore, the union argued that the IMF’s detachment from the consequences of subsidy removal undermines its credibility, casting doubts on the sincerity of its policy advice.

The NLC also called for Nigeria and other developing countries to reclaim their economic autonomy by resisting external policies that fail to address local needs.

“It is disingenuous for the IMF to deny involvement in Nigeria’s subsidy removal, given its history of advocating similar austerity measures. We hope our economic leaders recognise that during times of crisis, the IMF and World Bank will step aside, leaving the government to bear the consequences,” the statement read.

The NLC urged the IMF and World Bank to step back and allow Nigeria to pursue policies that address genuine needs and promote sustainable growth, welfare, and social stability. The union warned that continued interference could compel Nigeria to demand the institutions’ withdrawal from the country.