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An appellate authority at the Enforcement Directorate (ED) issued the so-called show cause notices under India's foreign exchange laws for alleged illegal remittances of 55.51 billion rupees ($673.2 million). India alleges Xiaomi's local unit made illegal remittances to foreign entities by passing them off as royalty payments. The notices were issued to Xiaomi and officials including the chief financial officer of its India unit, the ED said in a statement. The banks received notices because they allegedly allowed foreign remittances described as royalty payments without conducting due diligence and obtaining necessary documentation, the agency added. Court documents show Xiaomi's frozen assets are spread across accounts at various banks including Deutsche, Citi and HSBC.

Persons: Xiaomi, Aditya Kalra, Shubhendu Deshmukh, Shounak Dasgupta, Jamie Freed Organizations: HK, Deutsche Bank, HSBC, Citigroup, Reuters, Deutsche, Citi, Samsung Electronics, Thomson Locations: DELHI, India

The central bank's first female governor, Erkan is also its fifth chief in four years, underlining the challenge she may face delivering a lasting policy turnaround after Erdogan has all but stamped out the bank's independence in recent years. Analysts now expect Turkey's central bank to hike interest rates to between 20% and 25% from 8.5% as soon as this month. ORTHODOX FINANCE MINISTERErdogan, a self-proclaimed "enemy" of interest rates, has pressed the central bank to deliver stimulus in recent years and has been quick to replace its governor. The central bank slashed its policy rate to 8.5% from 19% in 2021, leaving real rates deeply negative and the lira largely managed by dozens of regulations covering credit and foreign exchange. But the last central bank governor to raise rates, Naci Agbal, was fired in 2021 after less than five months on the job.

Persons: Tayyip Erdogan, Hafize Gaye Erkan, Goldman Sachs, Erdogan's, Erdogan, Kavcioglu, Selva Demiralp, Mehmet Simsek, Simsek, Erkan, Naci Agbal, Marsh, Kathryn Wylde, Wylde, Ali Kucukgocment, Jonathan Spicer, Daren Butler, Cynthia Osterman, Hugh Lawson Organizations: Lira, First Republic Bank, Official Gazette, Koc University, U.S . Federal Reserve, Princeton University, First, JPMorgan, Analysts, FINANCE, Greystone, Partnership, New, Thomson Locations: ISTANBUL, United States, unorthodoxy, Erkan, U.S, New York City

☆ Turkish cenbank data shows $3 bln inflow from abroad -bankers
▼ + stars: | 2023-06-08 | by ( Nevzat Devranoglu | ) www.reuters.com time to read: +1 min

ANKARA, June 8 (Reuters) - Turkish central bank reserves data shows inflows of about $3 billion into depo accounts last week from abroad, bankers said on Thursday. The central bank did not comment when asked about the matter by Reuters. Four bankers contacted by Reuters calculated that there was between $3 and $3.1 billion deposited into the accounts. Before being re-elected to office on May 28, Turkish President Tayyip Erdogan said Gulf states had sent funding to Turkey, briefly helping relieve the central bank and markets. The central bank's net international reserves hit an all-time low of negative $5.7 billion as of June 2, data showed on Thursday, with demand having surged through the elections.

Persons: Tayyip Erdogan, Erdogan, Nevzat Devranoglu, Daren Butler, Jonathan Spicer, Emelia Organizations: Reuters, United Arab, Ece, Thomson Locations: ANKARA, Turkish, Turkey, Ankara, United Arab Emirates, Qatar, China, South Korea

☆ South Korea plans to discuss bilateral FX swap with Japan, finmin says
▼ + stars: | 2023-06-08 | by ( ) www.reuters.com time to read: +1 min

SEOUL, June 8 (Reuters) - South Korea will discuss with Japan re-establishment of their bilateral foreign exchange swap line that expired in 2015, its finance minister said on Thursday. "Current economic issues, including bilateral and regional financial cooperation, will be discussed at the bilateral finance minister meeting on June 29," Minister Choo Kyung-ho said, adding that currency swap arrangement was also on the agenda. Choo was speaking at a discussion forum, in response to a reporter's question about the bilateral finance minister meeting between Japan and South Korea that is scheduled to be held in Tokyo. On the domestic economy, Choo said this year's economic growth would likely be "slightly lower" than the government's previous projection of 1.6%. He said the revision would be contained in the government's economic forecast due in late June or early July, when it releases its biannual policy plans.

Persons: Choo Kyung, Choo, Jihoon Lee, Shri Navaratnam, Simon Cameron, Moore Organizations: Thomson Locations: SEOUL, South Korea, Japan, Tokyo

June 8 (Reuters) - Pakistan is likely to post GDP growth of 0.29% in the fiscal year ending June 2023, the country's economic survey released on Thursday said, well below the target of 5% set last year. Finance Minister Ishaq Dar told a news conference on the annual report that 0.29% GDP growth was a "realistic achievement" and anything higher was not achievable. Average year-on-year inflation rate for the period up to May 2023 was recorded at 29.2%, the survey found. In April and May, the country's inflation hit record levels, which were also the highest in Asia. Remittances of money sent from relatives abroad were down 13% for the FY23 until April, to $22.7 billion.

Persons: Ishaq Dar, Ariba Shahid, Asif Shahzad, Gibran Peshimam, Sakshi Dayal, Sudipto Ganguly, Barbara Lewis Organizations: International Monetary Fund . Finance, Thomson Locations: Pakistan, Asia

☆ Mexico peso's expected fall to be broken by favourable rate spread
▼ + stars: | 2023-06-08 | by ( Gabriel Burin | ) www.reuters.com time to read: +3 min

BUENOS AIRES, June 8 (Reuters) - An expected fall in Mexico's peso will likely be cushioned by its favorable interest rate spread, although there is a wide range of views on the currency's prospects over the coming year, a Reuters poll of foreign exchange strategists showed. It was also the best projection for the 12-month period in the survey's recent history, reflecting positive sentiment towards the big margin between Mexico's benchmark rate, currently at 11.25%, and the U.S fed funds rate range of 5.00%-5.25%. "This is particularly stark for MXN, whose volatility is the most subdued despite its arguably greater sensitivity to U.S.-driven risk-off shocks." In Brazil, the real , is set to fall 4.5% in one year to 5.14 per U.S. dollar from 4.91 this week. The real is up 7.7%, confounding detractors who saw it crashing early on in President Luiz Inacio Lula da Silva's government.

Persons: Optimists, Luiz Inacio Lula da Silva's, Gabriel Burin, Anitta Sunil, Aditi Verma, Jonathan Cable, Ross Finley, Sharon Singleton Organizations: Thomson Locations: BUENOS AIRES, Mexico's, U.S, Brazil, Buenos Aires, Bengaluru

The currency later recouped some of its losses, standing at 23.33 against the dollar by 0542 GMT, after touching a record low of 23.39 overnight during illiquid trading hours. "There is no air of panic in the markets as in previous times when there were such high losses. The central bank's net forex reserves hit an all-time low of negative $4.4 billion last month as demand surged through the elections. Investors are now awaiting the appointment of a new central bank governor to succeed Sahap Kavcioglu, who has spearheaded Erdogan's rate-slashing drive since 2021. Erdogan is considering appointing Hafize Gaye Erkan, a U.S.-based senior finance executive, as central bank governor, Reuters reported on Monday.

Persons: Tayyip Erdogan's, Erdogan, Mehmet Simsek, Simsek, Erik Meyersson, SEB, Meyersson, Sahap Kavcioglu, Hafize Gaye Erkan, Ali Kucukgocmen, Jonathan Spicer, Gareth Jones Organizations: Lira, Reuters, Thomson Locations: ISTANBUL, Ankara, U.S

☆ Kenya's parliament approves appointment of new central banker
▼ + stars: | 2023-06-07 | by ( Duncan Miriri | ) www.reuters.com time to read: +2 min

He will replace Patrick Njoroge, who is retiring after serving two terms as the central bank governor since 2015. In a voice vote, lawmakers adopted the report of the National Assembly's finance committee, which urged the house to back his appointment after vetting his suitability for the post. His predecessor, Njoroge, has maintained stable prices for most of his eight years at the helm. But the World Bank expects growth to edge up to 5.0% in 2023, underpinned by a recovery in agriculture. Reporting by Duncan Miriri; Writing by Alexander Winning; Editing by David EvansOur Standards: The Thomson Reuters Trust Principles.

Persons: Thugge, William Ruto's, Kamau, Ruto, Patrick Njoroge, Duncan Miriri, Alexander Winning, David Evans Organizations: Njoroge, National, Johns Hopkins University, International Monetary Fund, Kenyan, Treasury, Bank, Thomson Locations: Ruto, U.S

That hawkish change in market expectations has helped boost the U.S. dollar to its highest level since March. Just over 25% of economists in the poll, 23 of 86, forecast at least one Fed rate cut by the end of 2023, but that is down from 28% in the last poll. The U.S. Labor Department is due to release consumer price inflation data on June 13, the first day of the Fed meeting. "If most Fed officials feel at least another 25-basis-point hike will be necessary, it seems simplest to deliver that hike in June rather than 'skip'." Inflation as measured by core PCE was forecast to remain above 2% at least until 2025.

Persons: Jerome Powell, Powell, Philip Marey, Janet Yellen, Andrew Hollenhorst, Oscar Munoz, Prerana Bhat, Indradip Ghosh, Vijayalakshmi Srinivasan, Maneesh Kumar, Ross Finley, Mark Potter, Paul Simao Organizations: U.S . Federal, Reuters, U.S, Rabobank, Treasury, Bank of Canada, U.S . Labor Department, Citi, National Bureau of Economic Research, TD Securities, Thomson Locations: BENGALURU, U.S, Canadian

☆ Turkish lira crashes as new government sets sights on ‘rational’ policies
▼ + stars: | 2023-06-07 | by ( ) edition.cnn.com time to read: +3 min

Markets are also waiting for the appointment of a new central bank governor to replace Sahap Kavcioglu, who spearheaded interest rate cuts under Erdogan’s unorthodox policies. Bankers say the lira’s continued gradual depreciation will lead to improved market conditions and halt a decline in central bank reserves. But it sparked a record lira crisis in 2021 and sent inflation to a 24-year high above 85% last year. Erdogan is considering appointing Hafize Gaye Erkan, a senior finance executive in the United States, as central bank governor, Reuters reported Monday. Erkan would be the country’s fifth central bank chief in four years, after Erdogan fired previous governors as part of frequent policy shifts.

Persons: Tayyip Erdogan, Erdogan, Mehmet Simsek, Simsek, Sahap Kavcioglu, ”, Tim Ash, “, Hafize Gaye Erkan, Erkan, Paul McNamara Organizations: BlueBay Asset Management, Bankers, Reuters, Simsek, GAM Locations: Turkish, United States, Ankara, Turkey

☆ Turkey’s Lira Falls to New Low as a New Economic Policy Forms
▼ + stars: | 2023-06-07 | by ( Patricia Cohen | ) www.nytimes.com time to read: +2 min

A change in the country’s economic policy could reverse what several economists argue has been an unsustainable and reckless course. The president has repeatedly flouted conventional economic wisdom by maintaining that high interest rates fuel inflation. Most economists argue the opposite: Higher interest rates makes borrowing more expensive, which slows down investment and spending and, in turn, reins in price increases. When central bankers resisted pressure to lower interest rates, Mr. Erdogan fired them. That is why the government did everything it could to protect the lira’s value before the presidential election, Mr. Tastan said.

Persons: Mr, Erdogan, Goldman Sachs, Kadri Tastan, Tastan, “, ” Organizations: German Marshall Fund Locations: Turkey, Brussels

Markets are also waiting for the appointment of a new central bank governor to replace Sahap Kavcioglu, who spearheaded rate cuts under Erdogan's unorthodox policies. "I think we are seeing the impact of Simsek pushing (the Turkish central bank) for rational policy." Bankers say the lira's continued gradual depreciation will lead to improved market conditions and halt a decline in central bank reserves. But it sparked a record lira crisis in December of 2021 and sent inflation to a 24-year high above 85% last year. Erdogan is considering appointing Hafize Gaye Erkan, a senior finance executive in the United States, as central bank governor, Reuters reported on Monday.

Persons: Tayyip Erdogan, Erdogan, Mehmet Simsek, Simsek, Sahap Kavcioglu, Tim Ash, Hafize Gaye Erkan, Erkan, Paul McNamara, Huseyin Hayatsever, Jonathan Spicer, Ali Kucukgocmen, Tom Hogue, Christina Fincher Organizations: BlueBay Asset Management, Bankers, Reuters, Simsek, GAM, Thomson Locations: ANKARA, Turkish, United States, Ankara, Turkey, Jorgelina, Rosario, London

In its 13 charges, the SEC alleged that Binance and Zhao used Merit Peak and Sigma Chain, another trading firm controlled by Zhao, to commingle corporate funds with client assets and use the monies "as they please." This put customers' assets at risk while Binance sought to "maximize" its profits, the SEC wrote in its civil complaint on Monday. "All user assets on Binance and Binance affiliate platforms, including Binance.US, are safe and secure," it said in a statement on Monday. The funds received by British Virgin Islands-based Merit Peak between 2019 and 2021 flowed from Key Vision Development Ltd, also controlled by Zhao, the SEC filing on Tuesday showed. Reuters reported last month that Key Vision and Merit Peak, along with Binance's Cayman Islands holding company, formed the core of the global crypto exchange's financial network.

Persons: Changpeng Zhao, Binance, Zhao, Guangying Chen, Chen, Tom Wilson, Jane Merriman Organizations: U.S . Securities, Exchange Commission, SEC, Sigma, British, Vision Development, Key Vision, U.S, Reuters, Vision, Binance's, Sigma Chain's, BAM, Thomson Locations: Seychelles, British Virgin Islands, Islands, Binance, United States, U.S, Singapore

☆ Exclusive: China's state banks told to lower cap on dollar deposit rates -sources
▼ + stars: | 2023-06-06 | by ( ) www.reuters.com time to read: +3 min

SHANGHAI/BEIJING, June 6 (Reuters) - In a rare attempt to bolster China's yuan, a self-regulatory body overseen by the country's central bank has told major state-owned banks to lower dollar deposit interest rates, four people with direct knowledge of the matter said. The buoyant U.S. currency and the Federal Reserve's interest rate hikes have prompted many Chinese companies to hoard dollar receipts. China's central bank said last month it would resolutely curb large fluctuations in the exchange rate and study the strengthening of self-regulation of dollar deposits. China's central bank has so far appeared calm after the yuan breached the psychologically important 7 per dollar level in May. During previous rounds of depreciation, the central bank has sent verbal messages against one-way bets on the yuan.

Persons: Sumeet Chatterjee, Louise Heavens, Mark Potter, Alexander Smith Organizations: Reuters, People's Bank of China, Shanghai, Thomson Locations: SHANGHAI, BEIJING, United States, China, Beijing

☆ Bank of Korea: less desirable to increase gold holdings at this point
▼ + stars: | 2023-06-06 | by ( ) www.reuters.com time to read: +1 min

SEOUL, June 6 (Reuters) - The Bank of Korea (BOK) assesses it is more desirable to maintain its dollar liquidity than to increase gold holdings for foreign exchange reserves at this point, the central bank said. "A cautious approach is necessary for determining whether to increase the ratio of gold in the foreign exchange reserves," the BOK's Reserve Management Group said on Tuesday. The BOK released the gold management policy along with the results of its first inspection of gold holdings on May 23. It said the inspection at the Bank of England, where all of its gold holdings are stored, concluded without any major concerns other than some simple errors in refiner marks on three gold bars, which it said are frequent. The Bank of Korea holds 104.4 tonnes of gold in its foreign exchange reserves, or $4.8 billion, which account for 1.14% of its total $421 billion in reserves as of the end of May.

Persons: BOK, Jihoon Lee, Gerry Doyle Organizations: Bank of Korea, BOK's Reserve Management, Bank of England, Thomson Locations: SEOUL, London

☆ Analysis: Egypt faces external debt reckoning after borrowing spree
▼ + stars: | 2023-06-06 | by ( Patrick Werr | ) www.reuters.com time to read: +6 min

Amid a foreign currency crunch, Egypt has drawn down net foreign assets in the banking system by more than $40 billion in two years, partly used to prop up the pound. Reuters Graphics Reuters GraphicsReuters GraphicsFINDING FOREIGN FUNDSTwo of Egypt's main foreign currency streams, tourism and Suez Canal transit fees, have edged up. The hard currency squeeze has raised concerns about Egypt's ability to repay foreign debt. Those repayments to the IMF and foreign bond holders alone, worth about $4.5 billion, amount to more than half the annual $8 billion Egypt earns from the Suez Canal. Egypt's external loans leapt to $162.9 billion by December 2022 from under $40 billion in 2015, central bank data showed.

Persons: snubbing, Monica Malik, Moustafa Madbouly, Moody's, politican Abdel Fattah al, Sisi, Farouk Soussa, Goldman Sachs, Patrick Werr, Sumanta Sen, Aidan Lewis, Edmund Blair Organizations: Investors, International Monetary Fund, Finance, Reuters Graphics Reuters, Reuters, Reasssured, Stockholm International Peace Research Institute, Thomson Locations: CAIRO, Egypt, snubbing Egypt, Ukraine, Abu Dhabi, Suez, Cairo, Stockholm

☆ De-dollarization signs are emerging as the greenback slides in currency reserves, JPMorgan says
▼ + stars: | 2023-06-06 | by ( Filip De Mott | ) www.businessinsider.com time to read: +3 min

Signs of de-dollarization are showing in FX and central bank reserves, JPMorgan said. "Some signs of de-dollarization are emerging; this trend is likely to persist but USD should maintain its large footprint for the foreseeable future." "Some signs of de-dollarization are emerging; this trend is likely to persist but USD should maintain its large footprint for the foreseeable future," they said. And the dollar's share of foreign exchange reserves has also dropped. "De-dollarization is evident in FX reserves where USD share has declined to a record as share in exports declined, but is still emerging in commodities," JPMorgan said.

Persons: —, invoicing, Goldman Sachs Organizations: JPMorgan, Service, West, Russia's Locations: Ukraine

☆ Erdogan considering Erkan as Turkey cenbank chief, sources say
▼ + stars: | 2023-06-05 | by ( Orhan Coskun | ) www.reuters.com time to read: +4 min

Erkan met with Mehmet Simsek, Turkey's newly-appointed treasury and finance minister, in Ankara on Monday, one of the sources said. The two sources told Reuters she is set to meet Erdogan soon to discuss the possible role. Turkey's policy rate was cut to 8.5% from 19% in 2021, setting off a historic currency crash in late 2021. Erkan would be the country's fifth central bank chief in four years. The central bank has been the linchpin of Erdogan's programme of monetary stimulus and targeted credit to boost economic growth, exports and investments.

Persons: Erdogan, Tayyip Erdogan, Hafize Gaye Erkan, Erkan, Mehmet Simsek, Sahap Kavcioglu, Goldman Sachs, Simsek, Kathryn Wylde, Wylde, Naci Agbal, Marsh, Jonathan Spicer, Daren Butler, Angus MacSwan, Emelia Organizations: Reuters, First Republic Bank, Treasury, Ivy League, Princeton, New, First, JPMorgan, Greystone, Thomson Locations: Turkey, ANKARA, United States, Ankara, New York City, U.S

SHANGHAI/SINGAPORE, June 2 (Reuters) - China's yuan has skidded to six-month lows against the dollar and analysts say it could weaken further as investors fret over a bumpy pandemic recovery in the world's second-largest economy. "The yuan suffers as China's reopening story is less appealing than before, and there is no sign of further stimulus," said Gary Ng, senior economist for Asia Pacific at Natixis. "A weaker currency at the current juncture can help export performance, especially as global trade is shrinking this year." "A weaker yuan helps exporters when they convert the dollar receivables to yuan," said Barclays' FX strategist Lemon Zhang. A weaker yuan might also temper deflationary pressures being seen in parts of the economy due to weak domestic demand.

Persons: Gary Ng, Alvin Tan, Tan, Tommy Wu, Lemon Zhang, Serena Zhou, Winni Zhou, Brenda Goh, Tom Westbrook, Kim Coghill Organizations: Asia Pacific, Reuters, People's Bank of China, Asia FX, RBC Capital Markets, Barclays, FX, Mizuho Securities, Thomson Locations: SHANGHAI, SINGAPORE, United States, Natixis, Asia, China, Shanghai, Singapore

☆ Sri Lanka to remain on policy loosening course, next rate cut likely in August -analysts
▼ + stars: | 2023-06-02 | by ( Uditha Jayasinghe | ) www.reuters.com time to read: +3 min

Sri Lanka plunged into crisis last year as its foreign exchange reserves ran out, food and energy prices spiralled and protesting mobs forced the ouster of the country's then president. "With no inflation risk the central bank will cut rates aggresssively to push demand and target growth." The CBSL expects Sri Lanka's GDP to contract by 2% in 2023, slightly better than the 3% contraction predicted by the IMF. Five analysts backed CBSL and IMF estimates, two said Sri Lanka would perform better and one projected a steeper contraction of 4.8%. []Sri Lanka will begin rolling back import restrictions on 300-400 items from next week, as per a statement from the finance ministry which gave no further details.

Persons: CBSL, Dimantha Mathew, Kenji Okamura, Uditha Jayasinghe, Devayani, Swati Bhat, Toby Chopra Organizations: Sri, Citi Bank economists, International Monetary Fund, First, IMF, Thomson Locations: COLOMBO, Lanka's, Sri Lanka's, Sri Lanka, Colombo

☆ India's forex reserves fall for second straight week
▼ + stars: | 2023-06-02 | by ( ) www.reuters.com time to read: +1 min

MUMBAI, June 2 (Reuters) - India's foreign exchange reserves (INFXR=ECI) fell for a second consecutive week and stood at a one-month low of $589.14 billion as of May 26, the Reserve Bank of India's (RBI) data showed on Friday. Reserves had fallen by $6.05 billion in the week ended May 19, the biggest fall in more than three months. Foreign exchange reserves include India's Reserve Tranche position in the International Monetary Fund. The rupee rose 0.1% in the week ended May 26, having traded in a range of 82.5575 to 82.8500. The rupee ended at 82.3050 on Friday to record its best week in five.

Persons: Siddhi Nayak, Savio D'Souza Organizations: Reserve Bank of India's, International Monetary Fund, Siddhi, Thomson Locations: MUMBAI

KARACHI, Pakistan, June 2 (Reuters) - Pakistan has passed a special order to allow barter trade with Afghanistan, Iran and Russia for certain goods, including petroleum and natural gas, the Ministry of Commerce said on Friday. The government order, called the Business-to-business (B2B) Barter Trade Mechanism 2023 and dated June 1, lists goods that can be bartered. Sajid Amin, deputy director of the Sustainable Development Policy Institute, said Pakistan could gain particularly from oil and energy imports from Russia and Iran without adding to dollar demand. "While it may not solve currency smuggling, particularly at the Afghanistan border, it can discourage smuggling of goods from Iran, such as diesel, and Afghanistan which is hurting the economy," Amin added. In May, the Pakistan Petroleum Dealers Association complained that up to 35% of the diesel sold in Pakistan had been smuggled from Iran.

Persons: Sajid Amin, Amin, Pakistan's, Musadik Malik, Malik, Ariba Shahid, Asif Shahzad, Simon Cameron, Moore, David Holmes Organizations: Ministry of Commerce, State, Sustainable Development Policy Institute, Reuters, Pakistan Petroleum Dealers Association, Thomson Locations: KARACHI, Pakistan, Afghanistan, Iran, Russia

LONDON/TOKYO, June 1 (Reuters) - Global shares rose on Thursday amid receding bets for a U.S. rate hike this month and relief over the passage through the U.S. House of Representatives of a bill to suspend the federal debt ceiling. The Euro STOXX 600 index (.STOXX) rose 0.8% after closing at a two-month low in the previous session. The MSCI world equity index (.MIWD00000PUS), which tracks shares in 47 countries, added 0.2%. Also bolstering the mood were U.S. Federal Reserve officials including governor and vice chair nominee Philip Jefferson pointing to a rate hike "skip" at the Fed's June 13-14 policy meeting. However, shortly after, the Fed's Jefferson said skipping a rate hike in two weeks would provide policymakers time to see more data before making a decision.

Persons: Joe Biden, Ray Attrill, Philip Jefferson, Sandrine Perret, Jefferson, Patrick Harker, It's, it's, Tony Sycamore, Tom Wilson, Kevin Buckland, Simon Cameron, Moore, Lincoln, Emelia Organizations: U.S . House, Republicans, National Australia Bank, Federal, Fed, Philadelphia Fed, IG Markets, Treasury, Thomson Locations: TOKYO, U.S, Unigestion, Asia, London, Tokyo

☆ Nigeria: Fuel prices triple as new leader Tinubu ends subsidy
▼ + stars: | 2023-06-01 | by ( Nimi Princewill | ) edition.cnn.com time to read: +4 min

In a seemingly off-the-cuff remark during his inaugural speech Monday, Tinubu declared, “the fuel subsidy is gone,” adding that it was unsustainable. The last time the government tried to remove fuel subsidies in 2012, it sparked nationwide protests. Fuel subsidies are a drain on public finances and many argue that they have led to widespread abuse and corruption. Previous governments have tried unsuccessfully to remove the fuel subsidy, which has kept gas prices artificially low, although they have steadily climbed through the years. Fuel subsidies were not sustainable, but ending them “abruptly” without provision for economic and social consequences was “reckless,” he added.

Persons: Bola Tinubu, Tinubu, “, Joe Ajaero, Goodluck Jonathan, Sam Amadi, ” Amadi, NNPC Organizations: Nigeria CNN —, CNN, National Petroleum Corporation, Nigeria’s Labour Congress, Occupy, Abuja School of Social, ” Locations: Abuja, Nigeria, Africa’s, State, Occupy Nigeria

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