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Time to get it right on Nigeria’s economic policy

By Adetunji Ayobrown
Democracy is about accountability to the people, but when government it exercising political authority, it is using force, and force is violence. Allocating roles must be undertaken in an open, transparent and fair manner; this is the evolving developmental roles of Central Banks around the world especially as it concerns resource allocations. By bringing together all available good heads; maximising their intergalactic economic and individual potentials, making the nation’s ordinary policy infinitely more prolific.
A bit of a quandary when it comes to lending, many are of the opinion that banks and stock markets only believed in money and not people, but the reverse was the case when Nigerian banks Chief Executive Officers (CEOs) resigned from the board of the Nigeria Economic Summit Group (NESG) over a chain of policies initiated by this government portend to have negative impacts on Nigerians who had suffered beautifully for so long..
Politics apparently should brings out the best of all side of our nature, but crony capitalism will cause hunger and poverty as been witnessed by many Nigerians under the current leadership. However, it is rather weird or funny how APC governors continue to hail President Muhammadu Buhari in spite of obvious inefficiency in managing the Nigeria’s economy. As if it is a deliberate attempt to destroy the sleeping giant, the present economy policy is pushing people further down the poverty line.
In a self appraisal in the face of national hunger, the President, Major General Muhammadu Buhari (retd.) boasted that his regime has recorded what he called notable achievements, specifically in the area of agriculture. Perhaps his was commendations taken too far, while yet to fulfill most of his party’s electoral promises to the people.
While all that was on, Buhari met critical stakeholders over the rising prices of food in the country, leaving many bewildered about such sycophantic and unnecessary arrogation of praises where there is non-performance. Imagine what it will look like when banks CEOs are not part of a country’s economic team.
Three bank CEOs quitted NESG Board over Central Bank of Nigeria (CBN)’s economic interventions stance, which had created more poverty than wealth. Serious corporate governance breaches are daily being experienced, which actually shouldn’t be so, especially not at this time when the citizens, alongside citizens of the world are battling Coronavirus pandemic. Our FG is even now more nonchalant with its economic policies.
It is of serious concerns on how the CBN has been carrying on the business of foreign exchange transactions, loan disbursements (intervention funds) and price fixings without appropriate policy definition, therefore resulting in resignation of the NESG Board members, which is believed among financial experts to be the confirmation of the eroding credibility of the private sectors led think tank and policy advocacy group under the current leadership.
These workings can be subject to abuses, manipulations and significant market disruptions, reflective of a policy akin to crony capitalism. Evidently enough, on our national food security, the issues are beyond money and therefore require a complete overhaul of the management and support for the Agriculture sector and all related sectors – with a view to getting more value for our investments. Though, since the inception of this administration, agriculture and the need to ensure zero hunger for Nigerians have received considerable attention. But despite the budgetary allocations and huge sums of money disbursed by the CBN through the Anchor Borrowers’ Programme (ABP), a huge gap remains in meeting our national food requirements.
Nigeria made some progress in the socio-economic terms in recent years, but the human capital development remains weak due to underinvestment, which ranked the country 152 of 157 countries in the Human Capital Index.
Described as a growth too low to lift the bottom half of the population out of poverty, since 2015, Nigeria’s economic growth remains stagnant or muted, with an average of 1.9% in 2018 and remained stable at 2% in the first half of 2019, according to the World Bank.
Increasing our local food production by over 2000% will ranked the nation’s better in sufficiency and this is doable, so to say, with goodwill. And to make Nigeria’s agriculture productivity more sufficient, the government and private sector need to develop ways to enhance competitiveness in the international market and improve the efficiency of the country’s domestic production.
Without significant structural policy reforms, Nigeria’s medium term growth, which is projected to remain stable around 2%, given that the economy is expected to grow more slowly than the population, living standards are expected to worsen as been witnessed. The weakness of the agriculture sector weakens prospects for the rural poor, while high food inflation adversely impacts the livelihoods of the urban poor.
Associating numbers with structures; experts are of the belief that some of the measures taken by the CBN to stabilise the financial system will not bring the needed antidotes good enough to fast track meaningful economic recovery within the shortest possible time.
According to Debt Management Office, the country debt hits N31trillion, unfortunately, money made unscrupulously never stop recession. Despite expansion in some sectors, employment creation remains weak and insufficient to absorb the fast growing labour force, resulting in high rate of unemployment of about 25% with another 27% of the labour force underemployed.
Nigeria’s growth is constrained by a weak macroeconomic framework with high persistent inflation, multiple exchange rate windows and forex restrictions, experts say distortional activities by the CBN, and a lack of revenue driven fiscal consolidation results in such situation the country found itself. With an abundance of different natural resources, and being the biggest oil exporter with the largest natural gas reserves on the entire continent of Africa, Nigeria should have no business with poverty.
Financial experts expressed severe concerns about certain provisions of the ‘repealed and reenacted’ Bank and Other Financial Institutions Act 2020; recently passed by the National Assembly, and in the process of being transmitted to the President for assent. Many called it draconian, totalitarian and inimical to the development of a stable and transparently regulated financial sector and wishing the president should withhold his assent until the bill is properly reviewed, amended and is made fit for the purpose.
Being a key regional player in West Africa (Nigerians account for about half of West Africa’s population with approximately 202 million people and one of the largest populations of youths in the world), ought to be put to good use.
Objective and sensible decisions are needed to avert the continued massive developmental challenges, reduction of the nation’s dependency on oil through diversification of the economy, addressing the insufficient infrastructure and building strong and effective institutions, as well as issues of governance and public financial management systems.
Condo from many good ideas; at a time when all hands should be on deck, not allowing the Chief Executive Officers (CEOs) of prominent banks in the country to be part of the nation’s economic policy may not augur well for the needed economic stimuli. Restoring credibility into Nigeria’s financial sector is key, appropriate authorities need to properly review some of its policies to suit international best practices.
*Ayobrown, Senior System Analyst, National Pilot Newspaper, writes via

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