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The Impact of Nigeria’s Fuel Subsidy Removal on the Sustainable Development Goals of Selected African Countries: A Cross-Country Impact Assessment

In: Impacting Society Positively Through Technology in Accounting and Business Processes

Author

Listed:
  • Kola Benson Ajeigbe

    (Walter Sisulu University)

  • Fortune Ganda

    (Walter Sisulu University)

  • Oji Okpusa Oke

    (Cape Peninsula University of Technology)

Abstract

The objective of this research was to examine the association between fuel subsidies and sustainable development goals in selected African nations covering the period 2010–2022. The study employed the Panel Autoregressive Distributed Lag (PARDL) technique, the fully modified ordinary least squares (FMOLS), and dynamic ordinary least squares (DOLS) techniques. The findings of the techniques affirm that fuel exports, fuel subsidies, energy consumption, and renewable energy exhibit a positive relationship with economic growth, but a negative association with poverty. The estimated coefficients of fuel price and imports reveal negative associations with economic growth and positive connections with poverty in all model specifications. Overall, the outcomes of the FMOLS and DOLS techniques align with the long-term coefficients reported using the PARDL approach. The findings confirmed that the subsidy removal has a long-run positive impact on the selected economies. The outcome suggests a very strong relationship between fuel subsidy, renewable energy, and sustainable economic growth and poverty alleviation. Therefore, if the subsidy is removed, money saved from it must be diverted to developmental projects and renewable energy sources that can boost the economy and alleviate poverty. Based on these findings, it is recommended that nations should divert their resources into renewable energy sources by taking advantage of their seashores, hilly and steep topography areas to mount all their solar gadgets in order to solve energy problems in their countries. Achieving energy efficiency would not only solve electricity supply problem, but would also help grow local industries, attract more foreign investors, change investors’ perceptions about Africa, and help transit into the consumption of renewable energy, which is more environmentally friendly. This study provides new insights for nations, policymakers, investors, governments, lending institutions, and other stakeholders on the formulation of efficient policies to boost the achievement of the sustainable development goals (SDGs) in African countries and the entire world at large.

Suggested Citation

  • Kola Benson Ajeigbe & Fortune Ganda & Oji Okpusa Oke, 2025. "The Impact of Nigeria’s Fuel Subsidy Removal on the Sustainable Development Goals of Selected African Countries: A Cross-Country Impact Assessment," Springer Proceedings in Business and Economics, in: Tankiso Moloi (ed.), Impacting Society Positively Through Technology in Accounting and Business Processes, pages 801-819, Springer.
    • Handle: RePEc:spr:prbchp:978-3-031-84885-8_44
    DOI: 10.1007/978-3-031-84885-8_44
    as

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