Hope Crumbles as Unions, Police, and FRSC Hinder Tinubu’s CNG Initiative
The Persistent Rise in Transportation Costs in Nigeria
The Nigerian government has invested significant resources into promoting Compressed Natural Gas (CNG) as a cheaper alternative for transport. However, despite these efforts, transportation costs continue to rise across the country. This report explores the key factors behind this persistent increase, as highlighted by industry stakeholders.
Nigeria is facing a complex set of economic challenges that have contributed to a sharp and sustained rise in transportation costs. These include the removal of fuel subsidies, high inflation, and the devaluation of the naira. These issues have placed a heavy burden on commuters and households, deepening economic hardship and affecting living standards.
Transportation costs are particularly impacting food prices, which further exacerbates the challenges faced by Nigerians. While successive governments have tried various measures to curb rising living costs, poverty levels remain high. According to the World Bank’s April 2025 Poverty and Equity Brief, the rural population in Nigeria is disproportionately affected, with 75.5% of rural dwellers living below the poverty line. In urban areas, the figure stands at 41.3%, highlighting the growing inequality in the country.
President Bola Tinubu took office and immediately suspended fuel subsidies, believing it was anti-economic. Previously, the government had been subsidizing fuel and setting fixed retail prices for petroleum products. However, these subsidies were straining the nation's fiscal position and limiting funds for development projects.
In November 2021, the government announced plans to replace fuel subsidies with a monthly N5,000 transport grant for poor Nigerians. This plan was later suspended due to threats of mass protests from labor unions. In 2023, Tinubu officially suspended the fuel subsidy and proposed CNG as an alternative for Nigerians.
During the inauguration of 30 hybrid-powered CNG buses in August 2024, Tinubu emphasized the need for Nigeria to utilize its natural gas resources in the transportation sector. He stated that using natural gas to power transportation is essential for the country’s economic growth.
Despite these initiatives, the federal government has invested $450 million in CNG so far. In early 2025, the government announced plans to attract $1 billion annually in investments for CNG conversion projects. The Presidential CNG Initiative’s Programme Director, Michael Oluwagbemi, revealed that over $500 million had already been invested in the CNG space in the past year.
As more private and commercial vehicles converted to CNG, drivers began to see potential benefits. However, many still face high transport fares. Transport unions, backed by state governments, often take a significant portion of the savings, leading to continued high fares.
Findings show that transport unions are not the only ones contributing to increased fares. Police officers and Federal Road Safety Corps (FRSC) officials also play a role in extorting money from motorists. Drivers in states like Oyo, Lagos, and Ogun reported that fares could be significantly lower if these levies were addressed.
According to the National Bureau of Statistics Transport Fare Watch for April 2024, the average intercity bus fare in Nigeria surged to N7,122.57 in April 2024 from N3,994.51 in April 2023. Anambra State recorded the highest average fare at N9,600 per trip, while Kwara State had the lowest at N5,500 per trip.
The history of transport unions dates back to the colonial era, when they were formed to protect the interests of motor transporters. However, their current role has shifted, with many drivers feeling that they do not benefit from the unions but instead pay them daily.
Levies imposed by unions have significantly increased transport fares. For example, in Lagos, drivers now pay N2,000 per passenger to unions, compared to N800 previously. This has led to higher fares for passengers, especially during peak travel times.
Safety concerns have also emerged, with the FRSC cracking down on overloading in commercial vehicles. In September, over 250 drivers were arrested in the Federal Capital Territory for violating safety regulations.
Drivers have expressed frustration with the unions, describing them as government revenue collectors rather than supportive organizations. Some drivers have even faced physical abuse for refusing to pay union fees.
Transport unions have acknowledged the challenges but argue that only about 10% of commercial drivers use CNG. They suggest that importing LPG vehicles could help reduce fares further. The Road Transport Employees Association of Nigeria (RTEAN) has called for greater investment in the transport sector and the establishment of a transport bank to support drivers.
The Federal Competition and Consumer Protection Commission (FCCPC) has warned against arbitrary fare increases, especially during the holiday season. They emphasized that while price increases are not illegal, exploitative practices will be strictly regulated.
Despite the government’s efforts to promote CNG and reduce transport costs, the persistence of high fares highlights the need for comprehensive reforms and stronger enforcement of regulations. Addressing the role of unions, police, and other stakeholders is crucial to ensuring that the benefits of CNG reach both drivers and passengers.
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