By Adetunji Ayobrown
Nigeria economy is in depression; a multiple season of economic declines. Rare as it affects both the demand and supply sides, severe and prolonged downturn in economic activity. Commonly defined as an extreme recession that lasts three or more years or which leads to a decline in real gross domestic product (GDP) of at least 10%. in a given year. Last for years, rather than just several quarters and with all clarity, depressions and recessions differ both in duration and the severity of economic contraction.
Gross Domestic Product (GDP), the broadest measure of economic prosperity, Nigeria fell again by 3.62 per cent in the three months up till September. According the National Bureau of Statistics, for third quarter of 2020 indicated in its latest report that all is not well economically in our nation after just coming out of a recession.
Though, there is a global recession which already affected most industrialised and developed nations not to mention others, and which Nigeria was not excluded is now suffering another recession in a general recession kind of.
The giant of Africa turned dwarf under the burden of unabated rising debt profiles, inflation and unemployment, as official figures showed that the economy shrank again in the third quarter of this year. Buhari’s policies geared towards sharing revenue than production, according to experts cannot stimulate necessary elixir for any meaningful development or growth.
Arguably, economists disagree on the duration of depressions. Some believe a depression encompasses only the period plagued by declining economic activity. Some other economists argue that the depression continues until the point that most economic activity has returned to normal.
Series of factors can cause an economy and production to contract severely. But described as a stars spangled team of economic advisors comprising of most independent minded economists and with enviable CVs. Names in the formation of Nigeria economic teams will rival any team anywhere in the world. But unfortunately, under their watch, the business called Nigeria opens its chapter 11 again, bankruptcy was declared, our nation recorded another recession in a space of five-year business period.
Learning from the invaluable, with all their weekly meetings at the State House, the Economic Management Team (EMT), chaired by the vice president with key FG’s ministries and parastatals as members, solving any economic crisis should not be difficult coupled with their advisors’ profiles. But with all these, Nigeria business not only failed woefully but also repeatedly.
Don’t be evil, the Google’s mission statement, many Nigerians see many of the Buhari’s policies as anti-masses, fault of which can only be put at the door of the president himself.
Politics can be likened to a pastoral activities using instrumentalism of government for the betterment of the people. But no big deal for any government that seems to be failing in such to swallow pride, listen and seek help. Buhari regime’s second recession in five years.
Buharinomics is not working. Let us reverse this declining economic trend by changing the economic module. Nepotism is killing business, while square pegs in round holes won’t work. Recession or depression simply means FG had failed, lost the plot and not be able to do it properly. Now running desperately because of their non-creativity.
Issues of workers’ material condition. Government would have to spend a lot of money by increasing workers’ wages and capital expenditure to get the economy out of recession. Formulation of policies and strategies that will encourage private investors to invest should be considered.
Nigeria is not in recession but in depression because most of government borrowings were misused. Change is possible, the only problem is political will and diversification of the economy in real terms, not beseeching international buyers to buy our oil at $9/barrel and importing refined petroleum products at any fluctuating prices putting the ordinary citizen at the mercy of international oil price dictates.
Money is used to make money; it is a concept, money making is a bit like sport, the more you practice, the better you become and that is why the rich are getting richer because bank notes are bits of paper with enormous power. Nigeria business environment for production is seen as hostile by international investors, for no other reason but FG policies and weaker institutions which have not made it any better.
Venezuela, an oil producing nation currently experiencing total economic collapse and hyperinflation started like this. A good example for reference, we must do everything to avoid another depression.
When business is put before people’s feelings. Perhaps, a glaring trust deficit between the citizens and this government is key. there is an urgent need for both players in the Nigeria social contract to play their part for the country to achieve economic development.
According to the World Bank, Nigeria’s per capital income could fall to a 40-year low.
And that they don’t know Nigeria economy is about to hit the wall again, is shameful.
Be smart; when recession admires your business you better not make him partner!
Borrowing is a placebo and not a cure. Debt is a millstone round the debtor’s neck which can affect not only the health but also the wealth of a nation. Even right decision at a wrong time is a bad decision as prosperity is one those done privately, clandestine, and surreptitiously.
Purpose does what it must, while talent does what it can. That the team did not foresee that borrowing unscrupulously will lead to recession still baffles many, leaving everyone in disbelief that none of these high-powered team members refused to see or avert this national disaster is troubling and questionable of what they claimed to converge about all those times.
Ironically, taxation, a social contract which analyst believed and pointed out on how in short time can drive the needed economic development. But for abysmally low level of tax compliance, which i considered was not the citizens’ fault, but for the mistrust in government. A meagre 13 per cent of our population is captured in the tax net. People do not trust that the government would channel tax revenues for its intended purposes.
That the third recession is imminent is more than a cause for worries. Conventional monetary policies analyst said is not working, that the Central Bank of Nigeria (CBN) should ensure the full implementation of initiatives such as the agricultural intervention funds.
A good plan of yesterday will never result to today’s depression. About time something critical is done now to save the nation.
*Ayobrown, Senior System Analyst, National Pilot Newspaper, writes via [email protected]
