The Minister of Finance, Mrs. Kemi Adeosun has finally confessed that the Nigerian economy is in recession even though I had argued that the economy was already in recession in my article titled “Nigeria’s economy is finally in recession” and which was published by an online newspaper on 16 March 2015. Although the Minister of Finance, Mrs Kemi Adeosun immediately allayed the fears of Nigerians saying that we are soon going to get out of the recession.
Mrs. Adeosun further mentioned the measures that are being taken and assured that the economy will turn around for the better shortly. It is pertinent to state that Nigeria’s Economy finally fell into recession because the Buhari government have no concrete plan of action as far as the economy is concerned. Hence, President Buhari and his cabinet members have to fold their sleeves and start working towards economic recovery.
Since the inauguration of the Buhari administration on May 29, 2015, the president is yet to announce his economic team that are expected to help him design an economic plan and map out the policy direction for the government to address the economic problems it faces with the fall in price of crude oil and the looting of the Nigerian treasury by corrupt public office holders.
According to the National Bureau of Statistics, inflation rate is now 16.5 per cent and this was occasioned by the rise in energy cost which most Nigerians failed to kick against when government decided to increase the price per litre of refined petroleum products such as petrol, diesel and kerosene which now sell for 145 Naira, 200 Naira and 300 Naira respectively. Now, this has had a heavy toll on people’s welfare and living standards.
The negative economic growth for both Q1 and Q2 in 2016, the high rate of unemployment, high level of poverty and the high exchange rate shows that the Buhari administration cannot afford to handle the economy with prejudice and nonchalance. These economic indices must not be left the way they are and not made worse. Nigerian economy will not recover by itself as government had hoped and wished for. The Buhari government must know this and take appropriate action. The only way the populace can be sure that government is taking the right steps towards economic recovery is when we begin to see positive signs and improvements in the economic indices.
Nigerians should no longer be fooled with rhetorical statement from the Buhari administration officials that government is committed towards reviving the economy.
Having left the economy to recover by itself for over one year, the CBN governor, Mr Godwin Emefiele announced a new foreign exchange policy regime –a move that was expected to salvage the economic situation. But alas, the inter-bank dollar rate went from $197 to $330 while the black market rate increased from $330 to $375. Yet the Minister of Finance, Mrs Kemi Adeosun wants Nigerians to believe that government is taking appropriate steps but this is not a concrete plan of action.
Obviously, the Buhari administration needs help and must be bold enough to appoint the best minds as well as economic experts to guide the process of economic recovery irrespective of their political leanings. It will be foolhardy for the present government to run the economy based on unfounded believes and prejudice towards those who are knowledgeable about economic management and economic recovery.
The CBN under the leadership of Mr. Godwin Emefiele has decided to take the back seat on reviving the economy and watch the body language of the President. The CBN is afraid of coming up with solutions when the president has an idea of how the economy should be run. This idea has so far worsen the economic situation in the country with poor Nigerians bearing the brunt while those in power have failed to make the needed sacrifices.
Acknowledging that the economy is in dire straits, the Buhari administration provided a stimulus package to the states in order to enable them pay workers salaries. There are allegations that the states did not use the monies allocated from the stimulus package for the said purpose rather many of the states governors diverted the funds into capital projects where the funds can be easily embezzled. It is evident that the stimulus package alone is not enough to revive the ailing economy.
The events and happenings in the National Assembly since the inauguration of the 8th Assembly does not give a ray of hope towards economic recovery. The National Assembly is too embroiled in different scandals that the revival of the economy is not top on its agenda. Revelations made by Hon. Abdulmini Jibrin, showed that most Nigerian legislators are only concerned about their private pockets rather than working in the interest of poor Nigerians. The Buhari administration through the Secretary to the Federal Government, Babachir Lawal made matters worse when he truthfully admitted that the 2016 budget would not be fully implemented due to a 40 per cent drop in government revenue. All these indicate that poor Nigerians are in for a prolonged economic battle with no strong leadership, concrete plans and policy direction to revive the economy over the short, medium and long terms.
However, governments at all levels have to sit up now that we have finally confessed and admitted that the economy is in recession. I have offered the Buhari administration solutions to Nigeria’s economic crisis in my article titled “Nigeria’s Economic Crisis: The Way Forward” published by Guardian Newspaper on 16 August 2015 and available online. President Buhari need to increase the tax net, cut down the cost of governance by 50 per cent, expand the agricultural sector and create jobs under an agricultural youth empowerment program, expand the mining sector, encourage the export of Nigerian products and strengthen the manufacturing sector. It is up to officials of the Buhari administration to open up their minds to solutions and suggestions on the way forward for the economy. There is no harm in trying ideas for the administration that may work in ameliorating the sufferings of poor Nigerians.
The 8th National Assembly is less likely to pass bills that will impact positively on the lives of Nigerians just as it’s the case since the return of democracy in 1999. So the Buhari administration should lead the economic recovery efforts. The president has to encourage farming across the country by recruiting about 10 million farm workers yearly who will be registered under the government’s agricultural expansion scheme. Buhari administration must as a matter of urgency initiate a new power project as well as review the National Independent Power Project (NIPP) in order to jump-start the economy and create the avenue for the resuscitation of the manufacturing sector. Government should also revive the textile and clothing industry and provide players in this industry with tax cuts and incentives in order to meet the needs of millions who have to depend on the importation of textiles year in year out. These are some of the solutions that the Buhari administration can adopt to create the condition for economic growth.
The Buhari administration and the officials of the CBN must come up with a concrete plan of action to save Nigeria and Nigerians from the effect of negative growth and poor economic indices. The present recession is a consequence of lack of concrete plan of action as well as the believe and hope that the economy will recover by itself over time. Every Nigerian and businesses are now bearing the brunt of a mismanaged economy under the immediate past administration and lack of concrete plan of action under the Buhari administration. However, the Buhari administration must be commended for telling Nigerians the truth about the current state of the country’s economy. Government need a strong economic plan and policy direction in order to overcome the current economic crisis and lay a strong foundation for long-term economic growth.
Bolaji Samson Aregbeshola is an Op-Ed Contributor and the author of ‘’Nigerian Political Parties and Politicians: Winding Road from Country to Nation’’.
Op–ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija