• Thursday, February 22, 2024
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The imperatives of elevated economic discourse

The imperatives of elevated economic discourse

Nigeria is currently in the throes of painful but necessary economic reforms, which are essentially structural in nature – in the sense that they are reforms that affect or determine policies, procedures and processes that guide how and at what price we buy and sell in key markets like the foreign exchange market, the petroleum products market and the electricity market. Time will be required for the needed results to bear fruits, which is another nature of structural reforms. Meanwhile the short to medium term cost of economic reforms is huge and, in Nigeria, is largely and historically borne by the poor and economically vulnerable.

This explains why debates on economic reforms in Nigeria are often very emotional, acerbic and visceral. I remember how widespread, heated, vicious and emotionally draining the debate was on whether Nigeria should devalue the naira and accept an International Monetary Fund (IMF) loan in 1986 to cushion the effects of the harsh economic realities of the time. Nigerians unanimously stood against both the devaluation of the naira and an IMF loan to give the naira a soft landing. At the end of the day, a brilliant ‘homemade’ Structural Adjustment Programme blueprint was produced, which was essentially an IMF economic reform package without the cushioning effect of an IMF loan. Thus, the reform process was unnecessarily painful and the naira began an adjustment process that later became literally a free fall. All because Nigerians developed a deep-seated aversion for anything from the IMF.

 Nigeria should regain its position as the largest economy in Africa by the first quarter of 2025 or possibly the fourth quarter of 2024.

We are also aware of the strong ideological stance of the Nigerian Labour Congress against the removal of petroleum subsidy, which is one key reason President Muhammadu Buhari with his welfarist disposition found it so difficult to develop the required political will to remove or phase it out. We also witnessed the recent emotional outburst of the NLC against the World Bank, when it labelled the bank as enemy of Nigeria for advising the Federal Government to adopt a cost-reflective petrol price of N750/litre.

To be sure, the opposition to economic reforms goes beyond the labour movement and is a bit widespread, especially among the people at the bottom of the economic pyramid, but is also found even among the enlightened and highly educated, including academics. Some of the reasons include cost-of-living effects or consequences of economic reforms, the uneven sharing of the burden of economic reforms, with the larger share borne by the poor; and the least borne by politicians and policymakers – the initiators and implementers of the reform programmes. Other reasons include lack of trust of policymakers or government officials, even when they mean well and are prepared to do all that is necessary to successfully implement the reform programme; and sometimes ignorance or inadequate knowledge of economic principles, especially market-based economic reform policies, and how they can work to deliver the necessary change and improvement in the economy, provided all sta