Friday, August 26, 2016
Former governor of
Central Bank of Nigeria (CBN), Prof. Charles Chukwumah Soludo yesterday said
the economy is in deep trouble considering the reduction in per capita income
and dwindling Gross Domestic Product (GDP). He said the economy had compressed
by 50% in the past year.
With inflation
already at 16.48 per cent and still rising, most Nigerians are finding it
increasing hard to meet their basic needs, as the economy entered into full
blown recession following two quarters of consistent negative growth.
His comment on the
economy came barely 24hours after another ex-CBN governor and Emir of Kano,
Alhaji Sanusi Lamido Sanusi, expressed regrets on the policies of government.
But speaking in
Kaduna yesterday in his lecture at the fourth progressive governance lecture
series of the Progressives Governors' Forum in Kaduna, Soludo said the collapse
in the oil prices was a blessing for the country to start a new beginning.
His lecture was
titled: "Building the economy of states: Challenges of Developing Inclusively
Sustainable Growth". It was organized by the ruling All Progressives
Congress (APC) governors.
Soludo stated for
instance that the GDP has been compressed to 50 per cent from $578 billion
after the rebasing programme of 2014 to $290 billion due to huge deterioration
in key economic indications, while per capita income has also dropped from
$3,100 to $1,500. He noted that this has to be urgently addressed by economists
if the country is to survive the harsh realities and continue as a going concern.
The former CBN
boss who further observed that the collapse of oil is a privilege for a new
beginning for Nigeria, stated that the current recession was structurally and
politically induced and that the APC-led government must stop the blame game
and start on a clean slate.
Soludo, a foremost
economist, noted that agriculture, which is currently receiving massive
attention from the Federal and state governments, may not afterall, serve as a
means of economic diversification because many people will be forced out of the
business when mechanised farming is fully implemented. "Nigerian economy
has been massively compressed by 50 per cent. GDP is being compressed to 50 per
cent from $578 billion to $290 billion while per capita income has also dropped
from $3,100 to $1,500. "The transition to a Nigerian economy without oil
cannot be sustainable by merely pumping money into the system. If the aggregate
demand is on one side, we have other things on the other side to consider in
order to be able to sustain our economy," he said. According to him, no
state can develop sustainably if the overall governance and economy are in
crisis, stressing that Nigerian economy in terms of the dollar has collapsed by
about 50 percent.
"Nigeria is
facing unprecedented and tremendous political and economical challenges with
global and local dynamics. Regardless of these challenges, opportunities and
possibilities abound if we address some fundamental issues. The key to
achieving this is to have a development plan that is anchored on realizing
inclusive and sustainable growth.
He therefore,
recommended the restructuring of the economy from consumption-driven to
production-based and consistency in micro-economic policies.
"Encouraging
fiscal federalism in ways that allow states to have greater control of their
resources, evolution of a master plan for mass export-oriented
industrialization that answers the economic questions and realities of
today," he said.
At the forum, Vice
President Yemi Osinbajo said Nigeria has what it takes to be a great nation,
but the desired positive change cannot be achieved except public servants take
responsibility for the transformation of the country.
This is even as
the Governor of Kaduna State, Mallam Nasir Ahmad El-Rufai said the worst job in
Nigeria today is to be a governor.
Osinbajo said:
"We have what it takes to make a big difference. Like I said in Kano some
few minutes ago, we have the capacity in this country to make a great nation. I
don't believe there is any country, especially on the African continent that
has resources, men and material that we have.
"But a lot
will depend on us, the public servants, whether we are elected or appointed, we
are the ones that can make a difference in this country. If we as public
servants, see ourselves as being responsible for transforming our society, we
see ourselves as being the hope country and continent need, then perhaps, the
change is really possible. But, without us taking responsibility, very little
can happen.
"The
challenges that many states in Nigeria face today are not self-inflicted, some
are historical, they are legacy challenges, but then, we are required to come
to the table with fresh ideas to solve the problems. Some of the problems are
not problems we can solve in few months or even years.
"We have the
next few years to transform this country and I hope we would be able to make
that change. Am sure the states here are the ones to make that change,"
Osinbajo said.
El-Rufai said
Nigeria is facing an unprecedented economic crisis most of which arose from the
circumstances of the present and past.
The governor, who
also said the worst job in Nigeria today is to be a governor, lamented,"
we are left to redeem inherited problems. We don't have a hand in them, but we
have a duty to solve them".
El-Rufai, however,
expressed hope that Soludo's lecture will throw more insights into problems
that will help the states to get out of the current fiscal crisis.
In attendance at
lecture were Governors of Ogun, Lagos, Kaduna, Bauchi, Plateau, Kebbi, Borno,
Adamawa, Osun, Zamfara and Imo states. While those of Kwara, Benue, Nasarawa,
Katsina and Oyo states were represented by their deputies.
Reacting,
President, Manufacturers Association of Nigeria (MAN), Mr. Frank Jacobs, said
Soludo's comments were very accurate. "At the moment, many companies are
shutting down every day while many are managing to remain in business. It is
that bad. Unless there is a drastic change in the policy of government, the
unemployment condition in the country will take a turn for the worse,'' he
said.
Also, Sam Willie
Ndata, the doyen of stockbrokers, said said it is not only him that has been
talking about it, but every other person has been saying the same thing. The
country has not been going the way it should go and the government had better
sit up and do the proper thing and get the experts to run the government
"If he knows
what to do, he should do it fast before everybody dies," Ndata said.
Also commenting, a
former deputy governor of the CBN and social commentator, Dr. Obadiah Mailafia,
said: " I wouldn't say that I am satisified with the present economy. We
need a stimulus package. I have mentioned stimulus package before. I agree with
the Emir of Kano as well as Professor Soludo because they have a point. We need
a greater and more vigorous leadership. The President has the opportunity to
come out with new ideas, the opportunity to be innovative. He should also build
a coalition of the transformation of the economy. Right now we are not
happy."
But apparently
responding to attacks on Buhari's economic policies, royal fathers yesterday
urged Nigerians who have ideas on how to revive the economy to communicate the
Presidency in writing.