Economic Recession And Path To Nigeria’s Genuine Rediscovery
Nigerians over the years had been treated to spirit breaking economic phrases often coined by experts and authorities in their attempts to explain some economic realities. Yet, for decades they seemed not too familiar with the lexicon 'Recession' and the forlorn hope it holds for their future.
Indeed, not a few Nigerians were thrown off balance when the Nigeria Bureau of Statistics recently affirmed that the country had romped into a full scale recession as the economy contracted rapidly in the last two quarters of the 2016 fiscal year. To many, the recession is a tell-tale that the rhythm of prosperity that the Africa's largest economy had enjoyed for decade may have come to a stop.
Unwittingly, though, the Peoples Democratic Party (PDP) seized the scope of the tension generated by the issue to throw darts at the ruling government. With the familiar tone of mischief reeking of malice, critics also found excuses to dismiss the policies by the government on economy, alleging that the economy has been tumbling because the government of President Buhari lacks the savvy on management while failing all the same, to assemble the right team to offer a compelling assistance.
In their haste to denigrate the government, critics very ruefully have kept shying away from the fact that the recession which the Buhari's administration is toiling hard to contain, indeed, stemmed from the omissions and infractions by the past administration of former President Goodluck Jonathan. Nigeria, under Jonathan had an economy running on full throttle. Under it, crude oil sold for $140 per barrel, opening the vista of instant prosperity to the government and its officials. Not too long ago, the head of Jonathan's economic team, Dr Ngozi Okonjo-Iweala admitted that the era of economic bliss it enjoyed notwithstanding, the government was blindfolded, and all through displayed incapacity, failing to plan for the future. Yet, Jonathan's government failed in more diverse ways.
Aside its failure to curb corruption, mismanagement, profligacy and open display of affluence by members of its team and their surrogates, the Jonathan's government exposed itself as bereft of ideas on how to tackle insecurity. The Boko Haram insurgents capitalised on that weakness to ride the government and the rest of Nigeria roughshod. All through, the insurgents demonstrated capacity, looking strong to annex the entire north-east zone with a mission to even advance towards the Nigerian capital city of Abuja. Nonetheless, the government attenuated the zeal by the military to fight terrorism and insurgency. It watched helplessly as monies earmarked for purchase of arms and ammunitions ended in private pockets. Along the line, frustrated troops had to stage a mutiny in protest against lack of weapons to fight. Analysts had no option than to conclude that the government was deliberately fuelling the aggression by Boko Haram as avenue by privileged officials to steal and amass wealth.
With the Amnesty initiative, Nigeria was almost overcoming the Niger Delta question until the past government made another fatal slip in the management of crises from the zone. It ceded the security of oil pipelines to supposed repentant heads of militants who got enriched with contracts signed in billions of naira and foreign currencies. That seemed to be the root of the might by the Niger Delta Avengers and others, and their effrontery to destroy oil installations with intent to pull down the national economy to level zero, just for selfish reasons.
Although Nigeria is grappling with the worst economic condition brought about by maladministration of the past, the fact remains that the country is not the only one suffering from a bout of recession. Great economies, including US, China, Britain, France and others had suffered recessions repeatedly and came out stronger at different times. Nigeria's case from indications will not be an exception.
Economic recession, at the moment is wide spread among countries that operate monolithic economies built around oil resources. Venezuela, Russia, Libya, Iran, Iraq, Yemen are currently the worst hit. Even, Saudi Arabia is not left out of the pang. In a seeming desperation, Saudi Arabia, Iran and other major oil producing countries have been soaking the pressure by increasing their oil production output. The effects have been devastating. It is pegging the crude oil price to an all-time low of $42 per barrel. With this development, each of the countries has been devising the means of managing the brand of recession they suffer.
In Nigeria, the government of President Buhari is learning to approach the stiff challenge with courage, optimism and unflagging confidence. For the first time in history, Nigeria is instituting an economic diversification agenda meant to dwarf the over-dependence of the country on oil resources. The Buhari administration is raising the banner of integrity as the fulcrum of the agenda to drive its change initiatives. It has been placing the fight against corruption on the front burner thus whipping cabinet members and bureaucrats into line. It has attained successes in the battle to contain terrorism in the north-east zone with the zest to enhance national security.
Thus far, hope has started blossoming for Nigeria with the government's diversification agenda. The agriculture sector has taken the lead with preparedness to make Nigeria attain food security within a two-year period. The motive by the government is to return Nigeria to the post-independence era when agriculture stood as the main stay of the economy, generating employment opportunities for both the young and old. Counting on the blue print on Agriculture and the Green Alternative initiative by the Ministry of Agriculture, about 500, 000 youths are on the verge of being employed to produce food for Nigeria. Young graduates are already being engaged as agric extension workers in the scheme.
The aggressive commitment to rice production by the government is a hope for attaining the import substitution long expected in Nigeria. The extant reality is that in few months, Nigeria will begin to rank as a top exporter of rice and other cash crops to earn foreign exchange. Investors of rice production have been sounding notes of confidence that by the end of the year, the price of rice will crash in the face of mass production.
Already, the Raw Materials Research Development Council (RMRDC) has developed a National Strategy For Competitiveness In Raw Materials And Product Development in Nigeria. The strategy is to reactivate the morbid industrial sector in the country and make it more responsive to plans by the government to build industries and make them export oriented.
Under the government of President Buhari, infrastructure development has been on a fast rise. The railway sector is progressively being activated, starting with the inauguration of the Abuja-Kaduna railway line for commercial operations. On record, the government is to complete the on-going Lagos-Kano (with route now extended to Ekiti) within two years. It has set the ball rolling also for the completion of Calabar-Port Harcourt railway projects within same period. Undoubtedly, the projects will, in no small measure fester business prospects across Nigeria. In essence, the ease of business transactions is beginning to look as good as coming to fulfilment in the immediate future of the country, the President having ordered the completion of Enugu-Port Harcourt, Lagos-Ibadan, Oyo-Ogbomoso, Ilorin-Jebba and other major roads in Nigeria before the end of 2019.
A week ago, the Federal Executive Council unveiled a 3-year external borrowing plan to catalyse the growth of the economy. The government is currently riding on the crest of integrity by President Buhari to secure the loans from China, Japan, the World Bank and the African Development Bank
As outlined in the 2016 Budget, the low interest loan would be channelled into the productive sector while agriculture, mining, power and infrastructure would be main beneficiaries. Indeed, the fiscal discipline being exuded by the government in economic management is a guarantee that the loan, if obtained, would not be mismanaged.
More importantly, hope is not lost on Nigeria's oil sector given the disposition for dialogue by the aggrieved militants with the Federal Government. The expected dialogue, if properly explored holds the tendency for Nigeria to attain peace again in the Niger Delta zone. Such may encourage the resumption of full oil production by the companies in the zone.
In summary, the economic recession that has hit Nigeria is beginning to appear as a blessing in disguise. Some analysts conclude that recession it as a wakeup call on the rest of Nigeria to make a radical departure from their past while embracing new ways of meeting challenges. To analysts, it is high time Nigerians began to move away from their corruption breeding life style of ostentation, profligacy, showmanship and wastefulness. Nigerians, they argue must by now learn to be frugal and begin to think creatively on how to be employers of labour to help the economy. For Nigeria, however, a process of change, punctuated by a sudden economic recession is a path to self-rediscovery and genuine greatness that the country has long been craving for.
Written by Idowu Samuel, a journalist and public affairs analyst.