Every other day, we come to this space to talk about the current state of Nigeria’s economy and honestly, it’s become a tad… well, not tiring. We won’t stop until we get it right as a nation so here’s yet another solution thread provided by this oh so benevolent social columnist @sleezebreeze88.

The message he’s shared is way more convincing than his Twitter handle, so please learn from this thread and share accordingly:

Before I start, I would like to state that it would literally be impossible to talk about Nigeria's Economy while isolating her Politics.

— Fölarin (@sleezebreeze88) September 21, 2016

But I promise to do my best to make this talk as apolitical as possible.
The reason is not farfetched, so let's move on then.

— Fölarin (@sleezebreeze88) September 21, 2016

Another asked me what could be done to get the nation out of recession.
Before I answer these questions, I feel I would be justified…

— Fölarin (@sleezebreeze88) September 21, 2016

By stating a few of the reasons why the Nation is in an economic recession in the first place.

— Fölarin (@sleezebreeze88) September 21, 2016

Contrary to Twitter beliefs, Recession isn't just a word. Its an actual thing that happens to economically mismanaged states.

— Fölarin (@sleezebreeze88) September 21, 2016

And as far as economical mismanagement goes, Nigeria is right there at the very top of the list of these type of states.

— Fölarin (@sleezebreeze88) September 21, 2016

Lease let me quickly point out that this mismanagement didn't start 1year ago.

It is financially impossible to hit recession in 24months

— Fölarin (@sleezebreeze88) September 21, 2016

It's a gradual process of social, infrastructural & financial decay.

Where that cue takes us, I'll leave for now.
Because this is politics.

— Fölarin (@sleezebreeze88) September 21, 2016

Let's take Subsidies for example.
Nigeria subsidies foreign consumables to the detriment of domestic producers.

How, you ask?

— Fölarin (@sleezebreeze88) September 21, 2016

Petroleum Products, Rice, Wheat, Fertilizer, Cassava.

These are all products produced here, in Nigeria, but we still import the end produce

— Fölarin (@sleezebreeze88) September 21, 2016

Take Cassava for instance.

Nigeria is the leading producer of Cassava but we import Ethanol.

— Fölarin (@sleezebreeze88) September 21, 2016

How about Rice?

We have Abakaliki, Epe & the likes & yet in 2014, spent $2billion on rice importation alone.

— Fölarin (@sleezebreeze88) September 21, 2016

How about Tomatoes?

We have a vast Tomato belt in the North but we're the highest imported of Tomato Paste the world over!

— Fölarin (@sleezebreeze88) September 21, 2016

And then there's Petroleum!
The 6th highest oil producing nation in the world with d highest import of Petroleum Products!
Need I say more?

— Fölarin (@sleezebreeze88) September 21, 2016

Subsidies in Nigeria come in the form of a guaranteed fixed price on an internationally valued commodity

Regardless of the price difference

— Fölarin (@sleezebreeze88) September 21, 2016

What this simply means is, we are providing middle to high income earners extra jobs & financial security in foreign countries

— Fölarin (@sleezebreeze88) September 21, 2016

When you subsidize a consumable, you're saying “bring it & sell it for 30kobo, even if they're selling it for 90kobo"

— Fölarin (@sleezebreeze88) September 21, 2016

Anything your marketer makes on this margin is free money.

I could go on a detailed analysis of this, possibly later on as we proceed

— Fölarin (@sleezebreeze88) September 21, 2016

Anything your marketer makes on this margin is free money.

I could go on a detailed analysis of this, possibly later on as we proceed

— Fölarin (@sleezebreeze88) September 21, 2016

What I'm saying however in essence is simple.

Don't subsidize the consumable.
Subsidize the potential domestic producer of such a product!!

— Fölarin (@sleezebreeze88) September 21, 2016

Translation: DO NOT SUBSIDIZE RICE IMPORTATION!

SUBSIDIZE LOCAL RICE FARMERS WITH LOANS & FERTILIZER!!!!!!!!!

— Fölarin (@sleezebreeze88) September 21, 2016

DO NOT SUBSIDIZE OIL MARKETERS UPON IMPORTATION!

SUBSIDIZE THE BUILDING OF AN INDIGENOUS REFINERY!!!!

— Fölarin (@sleezebreeze88) September 21, 2016

Nigeria's present financial recession was caused by two simple things.

Just two.

Its Banking Sector (Capital Market) & Oil & Gas Market!

— Fölarin (@sleezebreeze88) September 21, 2016

Any Twitter handle who says its Buhari's is deliberately unintelligent.

Or a tool in the PDP led propaganda system

Both are bad either way

— Fölarin (@sleezebreeze88) September 21, 2016

This last point again, I would deliberately avoid expanding on.

But focus on the points I've chosen to speak on

— Fölarin (@sleezebreeze88) September 21, 2016

Banks failed simply because they were not being monitored.

Most were found to be in the practice of stock speculation.

— Fölarin (@sleezebreeze88) September 21, 2016

Anyone who knows his onions in the Banking industry knows this is highly unethical.

Most went as far as using depositors' money to do this

— Fölarin (@sleezebreeze88) September 21, 2016

It was literally Zero Risk investment.

If the stocks rose, they made a killing. If it crashed, they were safe, because depositor's funds.

— Fölarin (@sleezebreeze88) September 21, 2016

Most would have forgotten now, but this particular trend led to the jailing of a certain Bank CEO & the sack of many others.

— Fölarin (@sleezebreeze88) September 21, 2016

So just in case you're tempted to yell “Na Buhari cause am" just remember that Okonjo Iweala was the finace minister at the time.

— Fölarin (@sleezebreeze88) September 21, 2016

For the sake of just being petty, I remember someone referring to her as the Financial Sir Alex Ferguson.

What trite bullshit!

— Fölarin (@sleezebreeze88) September 21, 2016

That aside.

The second main reason behind the recession was our Petroleum market, which I have given a brief intro on.

— Fölarin (@sleezebreeze88) September 21, 2016

How, you ask?

Let's use Aunty Ngozi's faulty figures for a second as an illustration.

— Fölarin (@sleezebreeze88) September 21, 2016

They at the time claimed Nigeria was consuming anywhere between 35 to 36 million litres of petrol daily.

Assuming this is correct.

— Fölarin (@sleezebreeze88) September 21, 2016

and you do the numbers, Nigeria would be consuming 13.14Billion Litres of petrol a day!

I won't argue with this logic. Let's stick with it

— Fölarin (@sleezebreeze88) September 21, 2016

Pre-subsidy removal, this would have amounted to a daily subsidy fee in the excess of #392.4Million Naira!

Yes. 392Million Naira Daily

— Fölarin (@sleezebreeze88) September 21, 2016

With a yearly figure of about 143.23Billion Naira!

Just for subsidy to some few already ridiculously rich Billionaires!

— Fölarin (@sleezebreeze88) September 21, 2016

And this went on for 16years!

Need I remind you that the one person who advocated for its removal was sacked by GEJ before election?

— Fölarin (@sleezebreeze88) September 21, 2016

My apologies. I'm going political.

Its hard work not to mix the two, because the policy makers are all politicians.

So cause & effect.

— Fölarin (@sleezebreeze88) September 21, 2016

In a but shell, Nigeria pays a ridiculous amount of money on subsidizing fuel products to marketers who then resell these same products…

— Fölarin (@sleezebreeze88) September 21, 2016

.. To neighbouring nations like Cameroon & Chad at the standard market value of a 140naira on the litre.

Talk about classic Arbitrage!

— Fölarin (@sleezebreeze88) September 21, 2016

This steady fund deprivation within the economy led to the steady collapse of the nation's capital market.

— Fölarin (@sleezebreeze88) September 21, 2016

Which was made worse by the fact that the country doesn't have a say in determine the market value of Crude Oil.

— Fölarin (@sleezebreeze88) September 21, 2016

Neither do we have any substantial foreign commodity to help balance the books in terms of sales in the event of an Oil price collapse.

— Fölarin (@sleezebreeze88) September 21, 2016

This is still the case as we speak.

Hence my reason for starting this discussion by defining subsidization & where it should be applied.

— Fölarin (@sleezebreeze88) September 21, 2016

Now we're in a recession, how can the money market recover?

This is no easy feat to explain, but once again I would do my best to explain

— Fölarin (@sleezebreeze88) September 21, 2016

Nigeria's economy is not self sufficient.

Understand this in all totality. Our main means of value is determined by people we never see.

— Fölarin (@sleezebreeze88) September 21, 2016

Our GDP is predominantly determined by Crude Oil & we do not determine its pricing.

So if there's a price dip, we're in trouble.

— Fölarin (@sleezebreeze88) September 21, 2016

This is also the same for our Forex.

External forces determine the value of the Naira. So when the CBN set an exchange rate of 199…

— Fölarin (@sleezebreeze88) September 21, 2016

…it doesn't mean its the actual value of the naira to the dollar.

It means its the benchmark they can set to absorb the price difference

— Fölarin (@sleezebreeze88) September 21, 2016

A proof of this is the prevalence of a fully functional Parallel Market.

The naira is not as strong as its made to seem.

— Fölarin (@sleezebreeze88) September 21, 2016

Because the economy is not autonomous.

But we live in a country where Naira valuation to the dollar is used as a campaign slogan.

— Fölarin (@sleezebreeze88) September 21, 2016

“We left the economy at 180 to the dollar"

Yen yen yen!
Sit down & learn!

— Fölarin (@sleezebreeze88) September 21, 2016

The CBN is an autonomous regulatory body responsible for Nigeria's fiscal policies & reforms.

So when the set a value, its based on the…

— Fölarin (@sleezebreeze88) September 21, 2016

…market indications.

Take the subsidy reforms for example, the CBN provides the Forex to these marketers to buy Petroleum products…

— Fölarin (@sleezebreeze88) September 21, 2016

But all of this is a discussion for another day.

The ficus here is recession & its possible solutions.

— Fölarin (@sleezebreeze88) September 21, 2016

With an Inflation rate of 18% & an Interest rate of 14%, the economy is at an all time low
Once, it used to be a case of low risk high yield

— Fölarin (@sleezebreeze88) September 21, 2016

But the exchange rate and unstable oil prices is causing a bigger problem than we know.

We need to take the safer route of self production

— Fölarin (@sleezebreeze88) September 21, 2016

Nigeria wants to sell more oil to drive up revenue.

This is unwise considering the current market trend.

— Fölarin (@sleezebreeze88) September 21, 2016

The safer bet would be to source alternative income lines while they restructure the Oil & Gas sector.

— Fölarin (@sleezebreeze88) September 21, 2016

Anything beyond this is simply a case of “Quicker rewards, higher risk for the foreseeable future", and there are limitless proofs for this

— Fölarin (@sleezebreeze88) September 21, 2016

Another thing I would like to touch on briefly behind our many problems is the power players in the elite section who profit from the chaos

— Fölarin (@sleezebreeze88) September 21, 2016

Solution?

This is simpler than we've been led to believe in truth. And I'll never understand for the life of me why we ignore it.

— Fölarin (@sleezebreeze88) September 21, 2016

DIVERSIFICATION!!! DIVERSIFICATION!!! DIVERSIFICATION!!!

Diversify the Economy!
Its so Obvious!

— Fölarin (@sleezebreeze88) September 21, 2016

And also drive the GDP up.

Not to mention job creation, product availability & price reductions because of competition.

— Fölarin (@sleezebreeze88) September 21, 2016

A capital project must be set up for a major EPC company for the building & maintenance of local refineries.

— Fölarin (@sleezebreeze88) September 21, 2016

Lord knows we have more than enough Chemical Engineering & Petroleum & Gas Engineering graduates in the country.

— Fölarin (@sleezebreeze88) September 21, 2016

So in case you have 300 Billion Dollars you're not using, set up a Refinery here in Nigeria.

The economy would thank you for it.

— Fölarin (@sleezebreeze88) September 21, 2016

While the BoI & BoA can intensify their efforts to support small, medium & large scale industries & agricultural setups!

— Fölarin (@sleezebreeze88) September 21, 2016

The main reason why people are discouraged is because for farmers, there are poor storage facilities & manufacturers, foreign competition!

— Fölarin (@sleezebreeze88) September 21, 2016

Please note that my subtle hints at the failures of the last dispensation were not for the sake of partisan politics.

— Fölarin (@sleezebreeze88) September 21, 2016

…but rather to dispel the baseless & uninformed propaganda making the rounds about the present dispensation.

— Fölarin (@sleezebreeze88) September 21, 2016

Nigeria's economy didn't fail 15months ago.

That seed was planted long into the military regime.

— Fölarin (@sleezebreeze88) September 21, 2016

But make no mistake about it, that seed was well watered by every single PDP dispensation that ever ruled this nation in the last 16years.

— Fölarin (@sleezebreeze88) September 21, 2016

Cheers everyone…

— Fölarin (@sleezebreeze88) September 21, 2016

This was quite a lengthy yet well-articulated read and no details were missed. Now, we need someone who can submit it to the Finance minister…