The Nigerian economy is in recession, or
“technically in recession”, as the Minister of Finance, Kemi Adeosun,
put it last week, and seems to be at the lowest point it can be in
recent history. We have rocketing inflation at 16.9 per cent, high
unemployment rate, high interest rates exceeding 20 per cent per annum,
weak demand for goods and services and not just a stagnant economy, but
an economy that is shrinking. The foreign currency reserves over the
years fell from over $40bn to just about $26bn whilst international
rating agencies had a free reign downgrading Nigeria’s economic rating
and that of its associated private sector institutions. All the economic
indicators are pointing south and the horizon looks extremely bleak.
What do all these figures portend and how can they be reversed? It feels
like going down a steep slope without any hope of a wedge to slow down
the movement.
It is imperative to recall that sometime
in July 2015, the Central Bank of Nigeria through the communique of its
Monetary Policy Committee warned about an impending recession if things
continued the way it was going. The CBN called for urgent and drastic
measures to stem the tide but it is obvious no one seemed to have
listened. At that time and even up till now, most economic watchers stay
glued to the media to know the outcome of the Monetary Policy Committee
meetings. The impression has been created that the fiscal policy
component of macroeconomic policy does not matter or is either in
abeyance or does not exist.
Where do we begin to stem the tide? The
first step is to ask and provide answers to the fundamental posers. What
does the political leadership of the country headed by President
Muhammadu Buhari think about this situation? Is the President and his
team sufficiently worried about this ugly scenario? If the political
leadership have thought through the economic challenges, have they
communicated to Nigerians? If the answer to the second poser is in the
affirmative, what new ideas or old tested ideas are they bringing to the
table? The government is elected to govern with the consent of the
people and is expected to show leadership and policy direction in
matters that impact on the lives, livelihood and properties of citizens.
From the present scenario, the leadership seem to be in denial and no
one is seriously talking about the challenges in terms of planning an
exit strategy.
The starting point will be to devise an
agenda for action, an overarching framework for governance, not just in
the anti-corruption sector alone, but across all sectors. It is a
fundamental aphorism that if you fail to plan, you plan to fail. Nigeria
is too big to be run without a coherent policy framework. Running
Nigeria as the “spirit leads” the leaders cannot be an option in the
21st century. Investors, rational citizens, the international
community, etc, need to see the policy framework which will be the basis
of engagement. No reasonable person takes a leap of faith in making
investments worth billions of naira.
Just like the anti-corruption agenda has
taken the time of the administration, Nigerians need to be alive to
continue the struggle. We need to see our President lead discussions,
appoint strong committees, and hold expert sessions on different themes
of reviving the economy. The President needs a strong team anchoring our
economic revival. We need the best hands available in this country
irrespective of their political, ethnic, religious or geographic
leanings and origins.
In reviving our economy, we need to get
our priorities right; declare a state of emergency on the economic
sector. The contours of this state of emergency will have nothing to do
with accumulation of powers in one person or committee to enable the
abuse of human rights and liberties. Rather, it will include leadership
by example, reduction of salaries and perks of office of political
leaders. It is immoral and I dare say illegal, for elected and appointed
political office holders to insist on collecting the huge perks of
office at a time ordinary workers have not been paid for months. We need
to see a Nigerian-centric policy of buying made-in-Nigeria products
with the President, governors and legislators leading the way – not just
at the formal launch but in real terms.
If the Federal Government can produce
over a trillion naira to bail out states, why are we not implementing
the federal capital budget to the letter? Public spending and works in
roads, electricity, schools and other infrastructure are needed to
reflate the economy. So, why the delay? What is happening to the
hundreds of billions of naira that have been recovered through the
anti-corruption drive or the money saved through centralisation and the
curb of leakages by the TSA arrangement?
The emergency will create opportunities
for enhanced government-citizens dialogue and engagement so that
everyone (if possible) becomes part of the solution. Communication will
be important. The President needs good speech writers so that Nigerians
can hear motivating presidential speeches which challenge our sense of
productivity, patriotism and “Nigerianity”. But the work of economic
emancipation cannot be possible without responding to the Nigerian
question of how to run a federation with diverse peoples, cultures,
religions and expectations out of the system. There have been several
conferences funded at the public expense and all the President needs to
do is to dust them up and start the conversation. The legislature will
finish the remaining part based on the expressed wishes of the Nigerian
people. Such discussion and restructuring will liberate the energies of
Nigerians and galvanise them into enhanced productivity. There is no
part of Nigeria without the requisite resources to survive, blossom and
create surplus.
The emergency will activate actions in
the energy sector and seek to resolve the posers around access to
electricity. Without electricity, enhanced production of goods and
services cannot proceed. It will also seek to reform the petroleum
sector; many Nigerians are surprised that more than one year after
taking office, the Buhari administration has presented no clue through a
bill to reform the petroleum sector. These two components cannot go on
without seeking a final resolution to the Niger Delta debacle. Nigeria
will continue its ostrich movement to think it can resolve its energy
crisis without resolving the Nigeria Delta crisis. As we seek to
diversify the economy, we must insist on harvesting low hanging fruits,
which includes exploiting the whole value chain of the oil and gas
industry. Beyond Dangote’s sole intervention, we need refineries and
petrochemical complexes, gas collection and transportation facilities.
These can immediately improve energy access, lower prices and make the
economy more competitive. With gas availability, we will restart the
export of gas through the West African Gas Pipeline and even expand its
reach beyond the present configuration. We will make same available in
industrial hubs, commercial areas and households across many cities in
Nigeria.
The value chain approach adopted in
agriculture needs to be intensified. Utilizing the vast tracks of arable
land in the north and south of Nigeria will reduce un-necessary
confrontations and clashes between settled communities and herdsmen will
be a thing of the past. Can anyone imagine the economic benefits of
using the 95,363 thousand square kilometres of Niger State (and land in
other states) for all season farming to the Nigerian economy?
These are just but a few examples and in no way exhausts the possibilities open to us as a nation. The future lies in our hands.
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