The economic condition in Nigeria today may be very bad; it is actually terribly so, but it is certainly not irreversible. I feel the mood of most Nigerians who watch the value of their earning and savings vapourised in the face of inflation, now at 12.82 percent, exchange rate tending to N500 per United S dollar, and unemployment rate of 27.1 percent. Those are not the numbers you see among happy citizens anywhere in the world. It is natural for individuals to focus on the pains of the moment without casting more than a passing gaze at the solutions. That is human nature. The idea of self-preservation demands that humans react negatively to the stimuli of discomfort.
However, survival, and indeed progress, comes only if this initial reaction is followed by intelligent problem analysis and effort to apply reasonable solutions. In that regard, it is the solutions being administered to the current economic and security crises in Nigerians that should be our central focus. Are they well thought out and appropriate to the circumstances? Are they timely? I think it is better to focus on those things that make our current condition redeemable, rather than the pains of the moment. Scrutinising the economic policies constructively and proffering value-adding solutions should be a better preoccupation for us at this time.
Luckily, books are not judged by their looks and so what we see on the surface may be different from the eventual direction the economy and Nigeria as a whole may be going. First and on the positive side, Nigeria is not alone in the present pass. It is worldwide. This implies that the solution does not lie within Nigeria alone to apply. The varying travel conditions being imposed by different countries exemplifies the global nature of the problem. Even if we no longer have COVID-19 today in Nigeria, we cannot fly into any country as we used to, if they have any concerns with us.
SEE ALSO: Olanrewaju, ex-chairman of CRFFN frowns at Council’s failure to conduct election
Second, many things are being done in different countries and by the Nigerian governments (state, Federal and Local) to return the world to sanity, which have the potential to ease the pain we currently feel. What should therefore take interest in the policies at play and interrogate them for correctness.
Every country embarked on the provision of palliatives to cushion the effects of the pandemic. Nigeria was upfront in this regard, particularly the leading private sector corporates. They raised huge funds to support the provision of treatment centres, drugs and even food. The Central Bank of Nigeria, in its new and increasing activism, has established numerous intervention funds to promote the recovery of the MSME sector and to empower households. In particular, the N50 billion COVID-19 fund was distributed through the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) – a $500 million Non-Bank Financial Institution wholly-owned by the Central Bank of Nigeria (CBN).
NIRSAL was established, according to government, to redefine, dimension, re-price and share agribusiness-related credit risks in Nigeria. This fund was said to have been fully disbursed by April. Again, most Nigerian MSMEs have denied participating in the fund. In fact, some members of the organize private sector are calling for the head of NIRSAL and its management for refusing to heed the instruction of the CBN to carry them along. Such bodies as the Nigerian Association of Small-Scale Industrialist, Nigerian Association of Small and Medium Enterprises, Nigerian Farmers’ Association are said to have been excluded in the distribution.
Governments all over the country have been focused on making life easier for the people. However, whether their efforts are yielding expected results is a different kettle of fish. My preliminary take is that they are not. That is where we all need to be focused. First. are the policies well-intended? Some of them are. The palliatives were provided with good intensions but distributed in, at best, opaque manner. As a result, most Nigerians, particularly from certain parts of the country, did not see a dime of it. Similarly, the N50 billion provided by the CBN for on-lending to MSMEs was equally distributed in a translucent manner.
Evidently, between the cash palliatives and he CBN COVID-19 funds, one string runs through – poor management that culminated in lack of transparency. The federal government-owned microfinance bank, NIRSAL, may claim to have branches in every local government or the technical skills for financial services delivery but that is not all that is needed to effectively distribute financial support to private sector operators. Some have insisted that for accountability sake in matters of national patrimony, it is imperative to give feedback after such events by way of publishing the list of beneficiaries. This should be done at every stage of government distribution of public resources to avoid discretion without accountability, which is my simplest definition of corruption.
Without any doubt, the noose around the neck of the average Nigerian is getting tighter – average Nigerian now defined to include the middle class in its entirety. Every policy action taken, most of which were flawed on arrival due mainly to the operating environment and structural deficiencies of the country, have failed woefully and the livelihood of the people, especially the poor has taken a very bad turn. Without going far down the memory lane, and in order not to amplify the bad feeling about the high degree of destruction of wealth and livelihood that we have suffered in the past few years, I will not dwell on the dastard economic statistic we now clutch.
Suffice it to say that we need to more effectively implement public policy for it impact the targets. The absence of accountability is a major setback as public officers who mismanage policy implementation have had nothing to worry about. We must admit that there is nothing inherently wrong with the current managers of the economy. Some of them were my classmates that beat me in class. But something has gone terribly wrong with them for them to continue to behave as though they have no idea what to do. The system is a killer.
If Allan Greenspan and Ben Bernanke, both successful central bank governors of the United States, shared offices, as Governor and Deputy, in the CBN today, without more, the Naira, would probably be more devastated than it is now and our woes persist. It is time to discuss Nigeria’s economic behaviour, especially with regard to making it a thrifty producer rather than a profligate consumer. That way, we can still breathe despite the knees of insecurity and economic strangulation on our necks. I am not that am an advocate of a strong currency in an unproductive and uncompetitive economy. Although a weak currency will make exports expensive and force domestic production, it is not healthy for those that have nothing to sell but products whose prices are determined outside their limits of influence.
