Nigeria is a middle income, mixed economy and emerging market, with expanding financial, service, communications, technology and entertainment sectors. It is ranked as the 21st largest economy in the world in terms of nominal GDP, and the 20th largest in terms of Purchasing Power Parity. (From Wikipedia, the free encyclopedia).
Nigeria has pursued economic reforms to enhance management of public finance and make business regulations more efficient. However, the oil sector continues to dominate the economy, and
structural changes needed for broad-based development have not been forthcoming. Progress on privatization has been limited.
For decades, this country has been run by evil cartels which have kept the Nigerian consumer under their stranglehold. These cartels have manufactured fake drugs which kill our citizens. They have made fake spare parts, made cement and fertilizer unavailable to the people.
The generator importing cartel largely controlled by immigrant traders would always ensure that electricity supply would never work in Nigeria.
Since 1963, every economic policy by various political parties has been inconclusively executed. What has been for this has been a lack of political will followed by the absence of ideological orientation by successive chief executives of the federation.
The "Political Will" needed for economic growth and development is what President Buhari is using various means to install.
Is Buhari The Messiah or Not?
At this stage that President Muhammadu Buhari had barely spent eleven months in the office, I think it is more or less too early to criticize him and his cabinet or praise him as well.
Many people especially those in the opposition parties are claiming that, the country’s economy has slid into recession due to what they termed as the strict monetary policy of the President Muhammadu Buhari’s government.
A former President of the Nigerian Bar Association, Dr. Olisa Agbakoba (SAN), said and I quote “Nigeria is in a major recession. Economists measure recession by two negative growth periods. The National Bureau of Statistics has shown that we had negative growing periods all through last year, and the main reason, I think, is the economic policy of the government.
“The policy is referred to as strict monetarism, meaning that the government uses money to control growth. But it is a very difficult policy to use.”
Some said five months ago that, due to the glut in the international oil market, lack of a clear-cut policy orientation from the government and the absence of the federal executive council, there isn’t much to report on Buhari’s impact on the economy in the first 100 days of his tenure.
I have heard and I have read, many people say that the government of President Muhammadu Buhari does not have an economic direction. That this is the reason why things are getting bad in the country. My submission is that people who share this opinion have either refused to tell themselves the truth or they live elsewhere outside this world.
People need to know that not only does the Buhari government have an economic direction, it is also one that looks very promising.
In the last few months, particularly since President Buhari took over the mantle of leadership, things have really taken a nose dive. The hunger in the land is increasing, the unemployment rate is worsening and the poor are getting poorer. Was this unexpected? The answer is a clear no. What we are witnessing today is not a factor of a Buhari government. I posit that Nigeria would still have been witnessing the same thing or even worse if Jonathan were to be the president today and I will tell you why.
Except for the first quarter of 2015 when the price of crude under the Jonathan regime sold for $58.7 per barrel on the average, Nigeria’s crude sold for as high as $150. In 2011, 2012, 2013 and 2014, Nigeria’s crude was sold for a yearly average of $113.8, $113.5 $111.0 and $100.4 per barrels respectively. Within the same period, our foreign reserves rose and fell from $32,639.8bn $43,830.4bn $42,847.3bn and $34,250bn respectively, before it finally crashed to $29,595.28bn in the first quarter of2 015, while the country’s GDP rose from $409.34bn in 2011 to $561.61bn in 2014. (Source: RTC Advisory Services Ltd, Nigeria Retrospect – Economy and Policy, 1999-2015).
Looking at the above figures, the believe was that Nigeria’s economy was on a good footing, but this is not exactly so. Why the growth figures are good, the successes recorded are largely uncoordinated, especially because the structure and quality of growth were not considered. This is why the UNDP Human Development Report, 1996 stated that “unless governments take timely corrective action, economic growth can become lopsided and flawed. Determined efforts are needed to avoid growth that is jobless, ruthless, voiceless, rootless and futureless.” Take unemployment for example, despite the huge revenue from oil between 2011 and 2014, the unemployment rate never really dropped. In 2013, its was 24.7% and in 2014, it stood at 24.3%. Even in 2012 when the yearly average of oil earning was $113, unemployment rate stood at 27.4%.
The question then is why are most Nigerians poor despite rising revenues and GDP growth? The answers are not far-fetched. Firstly, oil which is Nigeria’s main revenue does not by itself, create many jobs. Jobs created from oil are only a few compared to the revenue it generates. Secondly, is the issue of corruption and lack of transparency that was pervasive in the last government. Over the last four years, there have been several alarming and scandalous cases of corruption in Nigeria. From the $6bn Fuel Subsidy Scam to the missing $20billion NNPC scam and the 300,000-400,000 barrels of oil per day that was stolen from the country amongst many others. And juxtaposing this with the fact the infrastructural problem of the country especially in areas of roads and transportation; power; Information technology continue to suffer neglect despite huge revenue, it will be a mirage to think that Nigeria can be repositioned for success.
So what is the way forward? What is the Buhari government doing differently? Since coming into power, President Buhari has put in place measures specifically to shore up the revenue of government because no matter how lofty your plans are, you can only implement those plans where there is money. This is why the president has ensured transparency in the oil and gas sector with the appointment of Dr Ibe Kachiku as the GMD of NNPC who in turn has taken measures to reform the sector and block leakages in oil revenue. The president also appointed Babatunde Fowler, the man who turned around the revenue of Lagos state to head the Federal Inland Revenue (FIRS) Hameed Ali into the Nigeria Custom Service (NCS). With the reforms and re-organisation going on in these two agencies of government, the plan is to ensure that revenue earned from both surpasses the revenue generated from oil.
The directive that all Ministries, Departments and Agencies of the Federal Government register for the Treasury Single Account domiciled with the Central Bank of Nigeria is also another measure to shore up government revenue. At least N1.4tn had so far been paid into the TSA to date, an amount that would have been available to looters to feast on in previous administration.
In addition, the government is also pursuing an anti-corruption agenda to prosecute and bring to justice, those who turned the country’s resources into their private pockets. Though, nobody has been convicted so far, but some perpetrators have been taken to court and some amount of money recovered.
Away from shoring up revenue, government has also put in place measures to invest in the people (social sector investment).To achieve this therefore, the government has outlined an objective of stimulating and supporting the establishment of world class skill acquisition centres in all 109 Senatorial Districts of the Federation. The government has also made a commitment to provide one meal a day for all primary school students which will create 1.14million jobs in agriculture, with a multiplier effect in increased food production and attract investment.
The government is also set to diversify the economy by investing in the areas of Agriculture, Manufacturing, Entertainment and Technology as well as boosting education and building capacity to improve teacher quality with the expectation of having an educated population to increase economic potential for productivity.
With the efforts at shoring up revenue as I earlier outlined, the government will have the resources to implement these programmes, the resultant effect of which would be more jobs for Nigerians, an educated and healthy population, a repositioned economy built on structures and quality of growth and a population lifted out of poverty. If this is not an economic direction, I wonder what is.
For Muhammadu Buhari, it is a walk back through history. Recall that the Nigerian economy at this time shares characteristics with the Nigerian economy of 1983 when he took charge of the reign of government on a rescue mission. The Naira was weak, crude oil prices were plummeting just as the national treasury – coupled with a heavy debt profile.
Nigeria has pursued economic reforms to enhance management of public finance and make business regulations more efficient. However, the oil sector continues to dominate the economy, and
structural changes needed for broad-based development have not been forthcoming. Progress on privatization has been limited.
For decades, this country has been run by evil cartels which have kept the Nigerian consumer under their stranglehold. These cartels have manufactured fake drugs which kill our citizens. They have made fake spare parts, made cement and fertilizer unavailable to the people.
The generator importing cartel largely controlled by immigrant traders would always ensure that electricity supply would never work in Nigeria.
Since 1963, every economic policy by various political parties has been inconclusively executed. What has been for this has been a lack of political will followed by the absence of ideological orientation by successive chief executives of the federation.
The "Political Will" needed for economic growth and development is what President Buhari is using various means to install.
Is Buhari The Messiah or Not?
At this stage that President Muhammadu Buhari had barely spent eleven months in the office, I think it is more or less too early to criticize him and his cabinet or praise him as well.
Many people especially those in the opposition parties are claiming that, the country’s economy has slid into recession due to what they termed as the strict monetary policy of the President Muhammadu Buhari’s government.
A former President of the Nigerian Bar Association, Dr. Olisa Agbakoba (SAN), said and I quote “Nigeria is in a major recession. Economists measure recession by two negative growth periods. The National Bureau of Statistics has shown that we had negative growing periods all through last year, and the main reason, I think, is the economic policy of the government.
“The policy is referred to as strict monetarism, meaning that the government uses money to control growth. But it is a very difficult policy to use.”
Some said five months ago that, due to the glut in the international oil market, lack of a clear-cut policy orientation from the government and the absence of the federal executive council, there isn’t much to report on Buhari’s impact on the economy in the first 100 days of his tenure.
I have heard and I have read, many people say that the government of President Muhammadu Buhari does not have an economic direction. That this is the reason why things are getting bad in the country. My submission is that people who share this opinion have either refused to tell themselves the truth or they live elsewhere outside this world.
People need to know that not only does the Buhari government have an economic direction, it is also one that looks very promising.
In the last few months, particularly since President Buhari took over the mantle of leadership, things have really taken a nose dive. The hunger in the land is increasing, the unemployment rate is worsening and the poor are getting poorer. Was this unexpected? The answer is a clear no. What we are witnessing today is not a factor of a Buhari government. I posit that Nigeria would still have been witnessing the same thing or even worse if Jonathan were to be the president today and I will tell you why.
Except for the first quarter of 2015 when the price of crude under the Jonathan regime sold for $58.7 per barrel on the average, Nigeria’s crude sold for as high as $150. In 2011, 2012, 2013 and 2014, Nigeria’s crude was sold for a yearly average of $113.8, $113.5 $111.0 and $100.4 per barrels respectively. Within the same period, our foreign reserves rose and fell from $32,639.8bn $43,830.4bn $42,847.3bn and $34,250bn respectively, before it finally crashed to $29,595.28bn in the first quarter of2 015, while the country’s GDP rose from $409.34bn in 2011 to $561.61bn in 2014. (Source: RTC Advisory Services Ltd, Nigeria Retrospect – Economy and Policy, 1999-2015).
Looking at the above figures, the believe was that Nigeria’s economy was on a good footing, but this is not exactly so. Why the growth figures are good, the successes recorded are largely uncoordinated, especially because the structure and quality of growth were not considered. This is why the UNDP Human Development Report, 1996 stated that “unless governments take timely corrective action, economic growth can become lopsided and flawed. Determined efforts are needed to avoid growth that is jobless, ruthless, voiceless, rootless and futureless.” Take unemployment for example, despite the huge revenue from oil between 2011 and 2014, the unemployment rate never really dropped. In 2013, its was 24.7% and in 2014, it stood at 24.3%. Even in 2012 when the yearly average of oil earning was $113, unemployment rate stood at 27.4%.
The question then is why are most Nigerians poor despite rising revenues and GDP growth? The answers are not far-fetched. Firstly, oil which is Nigeria’s main revenue does not by itself, create many jobs. Jobs created from oil are only a few compared to the revenue it generates. Secondly, is the issue of corruption and lack of transparency that was pervasive in the last government. Over the last four years, there have been several alarming and scandalous cases of corruption in Nigeria. From the $6bn Fuel Subsidy Scam to the missing $20billion NNPC scam and the 300,000-400,000 barrels of oil per day that was stolen from the country amongst many others. And juxtaposing this with the fact the infrastructural problem of the country especially in areas of roads and transportation; power; Information technology continue to suffer neglect despite huge revenue, it will be a mirage to think that Nigeria can be repositioned for success.
So what is the way forward? What is the Buhari government doing differently? Since coming into power, President Buhari has put in place measures specifically to shore up the revenue of government because no matter how lofty your plans are, you can only implement those plans where there is money. This is why the president has ensured transparency in the oil and gas sector with the appointment of Dr Ibe Kachiku as the GMD of NNPC who in turn has taken measures to reform the sector and block leakages in oil revenue. The president also appointed Babatunde Fowler, the man who turned around the revenue of Lagos state to head the Federal Inland Revenue (FIRS) Hameed Ali into the Nigeria Custom Service (NCS). With the reforms and re-organisation going on in these two agencies of government, the plan is to ensure that revenue earned from both surpasses the revenue generated from oil.
The directive that all Ministries, Departments and Agencies of the Federal Government register for the Treasury Single Account domiciled with the Central Bank of Nigeria is also another measure to shore up government revenue. At least N1.4tn had so far been paid into the TSA to date, an amount that would have been available to looters to feast on in previous administration.
In addition, the government is also pursuing an anti-corruption agenda to prosecute and bring to justice, those who turned the country’s resources into their private pockets. Though, nobody has been convicted so far, but some perpetrators have been taken to court and some amount of money recovered.
Away from shoring up revenue, government has also put in place measures to invest in the people (social sector investment).To achieve this therefore, the government has outlined an objective of stimulating and supporting the establishment of world class skill acquisition centres in all 109 Senatorial Districts of the Federation. The government has also made a commitment to provide one meal a day for all primary school students which will create 1.14million jobs in agriculture, with a multiplier effect in increased food production and attract investment.
The government is also set to diversify the economy by investing in the areas of Agriculture, Manufacturing, Entertainment and Technology as well as boosting education and building capacity to improve teacher quality with the expectation of having an educated population to increase economic potential for productivity.
With the efforts at shoring up revenue as I earlier outlined, the government will have the resources to implement these programmes, the resultant effect of which would be more jobs for Nigerians, an educated and healthy population, a repositioned economy built on structures and quality of growth and a population lifted out of poverty. If this is not an economic direction, I wonder what is.
For Muhammadu Buhari, it is a walk back through history. Recall that the Nigerian economy at this time shares characteristics with the Nigerian economy of 1983 when he took charge of the reign of government on a rescue mission. The Naira was weak, crude oil prices were plummeting just as the national treasury – coupled with a heavy debt profile.
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