Nigeria’s economy in dire need of professional touch

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Uba Group

Uba Group

Since the All Progressives Congress took over the steering of the ship of the Nigerian state from the Peoples Democratic Party in 2015, the country’s economy has set the unenviable record of slipping into recession twice within a four-year period.

When Nigeria’s Gross Domestic Product contracted by 3.62 per cent, year-on-year, in real terms in the third quarter of 2020, according to data from the National Bureau of Statistics, the country’s economy handlers blamed Covid-19.

While analysts agree that the pandemic had an impact on national economies, they posit that the Nigerian economy had no business falling into a stagflation but for gross mismanagement that has come to characterise governance under the current administration.

The NBS put the Nigerian economy into two buckets – oil and non-oil sectors. However, analysts insist that the country ought to be looking beyond oil as the mainstay of its economy. Popular opinion is that the vast natural resources and human capital available should be properly harnessed to boost the economy, as against overreliance on oil.

Recall that two former presidents thoroughly briefed and mandated astute professionals to take charge of the national economy while reporting directly to the president. Prof Chukwuma Soludo and Dr Ngozi Okonjo-Iweala, erstwhile Governor of the Central Bank of Nigeria and Minister of Finance, respectively, took their turns to shine in the positon of overseeing the economy, the highpoint of which was the rebasing that captured all segments with credible statistics that showed Nigeria to be Africa’s biggest economy.

But the President Muhammadu Buhari administration seems averse to putting round pegs in round holes. Rather, it appears the government is preoccupied with propaganda, despite riding to power on the back of a four-pillar economic agenda.
The APC, while campaigning for office in 2014, promised to grow the economy through food sufficiency, youth employment, social investment programmes, and fighting corruption.

Now, halfway into its second four-year term, though the government has tried to encourage local food production through an import ban on rice and border closure, the jury is still out on the achievements of these policies. Meanwhile, growing insecurity has adversely impacted food production in the country. Many farmlands remain deserted as farmers now require “special arrangements” with renegades or the armed forces to access their farms or risk death in the process.

Youth employment seems to be a tool to fuel and mask corruption in the bid to empower party members and loyalists. The government’s N-Power and 774,000 jobs programmes have been hijacked by politicians who use them to soothe the nerves of cronies and hangers-on. Even then, some beneficiaries of N-Power’s N30,000 (about $63) monthly stipend lament non-payment. The 774,000 jobs scheme promises a monthly stipend of N20,000 (about $42).

“While analysts agree that the pandemic had an impact on national economies, they posit that the Nigerian economy had no business falling into stagflation but for gross mismanagement”

Meanwhile, unemployment has jumped to 33 per cent, from 19 per cent in 2018, according to NBS data.

Similarly, the Buhari administration’s social investment programme has achieved little. Whether it is TraderMoni, MarketMoni or by whatever other name it goes, the paltry N10,000 (about $21) extended to random individuals by the government has been generally perceived as a form of voter inducement, especially as the government has habitually chosen electioneering periods to distribute the money.

The fourth leg of their four-point economic agenda, fighting corruption, stands shaky. The government’s propaganda is that corruption is fighting back. However, what is common knowledge is that the so-called anti-corruption fight may have become a veritable political tool. Many accuse the administration of being partisan in its anti-graft war. For many observers, the ruling APC has become a sanctuary for corrupt politicians seeking to escape prosecution.

While the current administration pays lip service to growing the economy, harsh operating environment – including epileptic power supply and the resultant high cost of generating private power – continues frustrating foreign direct investment inflows. This has also seen many companies relocate from Nigeria, leading to job losses and worsening unemployment levels.

The global village reality is best seen in the areas of commerce and trade. We are worried that Nigeria seems to be doing nothing to take advantage of her vast market potential. The naira, the local currency, has been on a free fall, while foreign exchange challenges continue to frustrate businesses and manufacturers who need dollars to import essential raw materials.

Clearly, all is not well with the Nigerian economy. No matter how long the handlers continue to live in denial, the worsening living conditions of the average Nigerian bear the tell-tale signs of an economy not built.

In order to steer the economy away from the brink where it is currently tottering, analysts say the government should encourage more private sector participation in the economy. We agree. The government can only do so much. Private capital can go a long way in rejuvenating the economy.

That is why strategic efforts should be geared towards boosting the MSME segment, the engine of economic growth. When businesses survive, they will employ people, pay taxes and contribute to the overall growth of the economy.

“CBN"