ADDRESSING THE NAIRA'S FREE-FALL IN THE WAKE OF ENERGY SUBSIDY REMOVAL: A POLICY ROADMAP FOR NIGERIA'S DEMOCRACY

Abstract

This research review paper explores the complex relationship between the removal of energy subsidies and the depreciation of the Nigerian naira under the current democratic government. Energy subsidies have long been a point of contention in Nigeria, with successive governments grappling with the economic, social, and political implications of their removal. The removal of energy subsidies has been touted as a necessary measure to free up government revenue for development projects, but it has also triggered inflation, social unrest, and a free fall of the naira in the foreign exchange market. This review paper examines the historical context of energy subsidies in Nigeria, their impact on the economy, and the theoretical and conceptual frameworks that explain the interaction between subsidy removal and currency depreciation. It also delves into the current administration’s policies on subsidy removal, the challenges posed by the free fall of the naira, and potential strategies for mitigating these issues. The paper concludes with recommendations for sustainable economic reform, focusing on balancing fiscal responsibility with social equity in a democratic context.