The Effects of Rolling Back the State on Development of Nigeria’s Political Economy (2003 – 2007).

ABSTRACT The study focused on the deregulation of the downstream of Nigeria’s petroleum sub-sector as an aspect of Rolling back the state in Nigeria. Deregulation of the downstream of the petroleum sector is occasioned by the removal of subsidies on petroleum products. This leads to a hike in the pump price of petroleum products which has brought untold hardship on the people. According to government, it spends a huge amount of money on subsidizing fuel products. Thus government resources previously used for subsidy of petroleum products will be used to undertake more development programmes such as construction of good roads, clinics, hospitals and good drinking water etc. for the general public. Thus, the broad objective of the study was to understand the effects of rolling back the state on the political economy of Nigeria. Its specific objectives were; to examine the impact of deregulation of the downstream of the petroleum sector on the road transport and public health sectors of the Nigerian economy within the period 2003-2007. Data for the study were generated through the observations of primary and secondary sources and interview of respondents. The data were analysed using tables, percentage and correlation analysis. The social production theory propounded by Karl Marx and other exponents provided the basis under which the study was carried out. The framework was applied to the explanation and understanding of deregulation as a capitalist mode of production in the road transport and health sectors of the economy. The findings of the study shows that deregulation of the downstream of the petroleum sector allowed the private sector owned road transportation system to increase the cost of transport fares anytime the government announced increase in the pump price of products. An increase in the cost of road fares translated into increase in prices of goods and services which ultimately resulted in inflation. Equally the huge amount derived from petroleum has not been judiciously expended for building and construction of roads. On the health sector, this has led to poor quality and inadequacy of health care services provided in public hospitals which in turn has made the private sector an unavoidable choice for those seeking health care. The fees charged in private hospitals are expensive and affordable to the rich, with some of them travelling abroad for medical care while the poor are forced to patronize patent medicine stores, quack doctors and the use of herbs for health care delivery. The research recommends that owing to the poor state of social services and infrastructure, government should suspend the idea of deregulation as this will lead to increase in cost of petroleum products, cost of essential services and inflation which will result in hardship on the already impoverished Nigerians.