• Tuesday, March 19, 2024
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Focus on aggressive policy implementation, stakeholders task FG

BD-PostElectionOutlook

As part of agenda setting for the Federal Government ahead of the commencement of President Muhammadu Buhari’s second term in office, leading economists, economic managers and other stakeholders on Thursday harped on the need for aggressive execution of policies to drive economic growth and business confidence in Africa’s most populous country.

The distinguished line-up of speakers and panellists from across key sectors of the economy at the BusinessDay post-election outlook conference in Lagos included Godwin Emefiele, governor, Central Bank of Nigeria; Okey Enelamah, minister of Industry, Trade and Investment; Ayo Teriba, CEO, Economic Associates; Nonso Obikili, chief economist, BusinessDay; Franklin Ngwu, senior lecturer in strategy, finance and risk management, among others.

Speaking at the conference with the theme ‘An Agenda for Economic Growth and Business Confidence’, Enelamah outlined policy thrusts for the next four years to include restoring growth, full execution of investment-friendliness, full execution of industrialisation, and targeted investment for the most vulnerable.

“It is time for aggressive execution of policies,” Enelamah said.
He called for bolder investments in infrastructure to about $25 billion from the current $4 billion by creating opportunities for private investment, proactively attracting investment, expanding depth and access to investor incentives, advancing market confidence, and full rollout of special economic zones and key sector polices. He emphasised the need to grow tax revenue, saying the current tax revenue base is not good enough.

Godwin Emefiele, governor, Central Bank of Nigeria (CBN), said Nigeria’s biggest problem “is execution of policies” and wondered why policies never get to the part of implementation.
President Buhari won a second term in the February 23 presidential polls, defeating his main challenger, Atiku Abubakar of the People’s Democratic Party (PDP), with 15.19 million votes to 11.26 million.

Nigeria’s economy has tottered in the last four years under Buhari’s watch. After five quarters of uninterrupted GDP contraction (beginning from first Quarter of 2016), the economy exited recession in the second quarter of 2017. The recovery, though fragile, has been sustained for seven consecutive quarters. The pace of quarterly GDP growth has improved from .5 percent in the second quarter of 2017 to 2.38 percent in the fourth quarter of 2018. The short-term outlook continued to strengthen with average growth projections of about 3 percent for 2019, up from 1.81 percent in 2018.

Emefiele said there was need to consolidate on this growth, implement strategies and policies that will aggressively grow jobs on a mass scale, and diversify Nigeria’s economic base away from excessive reliance on oil.

“Doing this will require additional efforts by all stakeholders,” he said, adding that Nigerians must close ranks and work to complement policies that will primarily be tagged ‘Grow, Produce and Consume made in Nigeria’.

Emefiele said following the successful general elections, over $6 billion has been flown into the local bond market in one month, indicating confidence in the economy.

In Q4 2018, the market experienced some capital flight from FPIs (primarily due to US policy normalisation) and the CBN stepped up to provide support by intervening in the market.
Since the start of this year, inflows from Foreign Portfolio Investors have picked up, with funds currently accounting for at least 50 percent of inflows at the I&E window.

Emefiele projected the economy to pick up in 2019, forecasting a GDP growth of 3 percent, up from 1.8 percent recorded last year.

He set the post-election agenda for the nation’s monetary policy, projecting that the current monetary policy stance of the bank to continue.

The CBN governor said as at March 15, 2019, the apex bank had committed a total of N171.35 billion in the Anchor Borrowers’ Programme with active participation across 36 states of the Federation and FCT, as a total of 920,788 farmers have benefitted in the programme, cultivating about 960,643 hectares of land.

“In due course, we intend to also address challenges in the cocoa, cassava, beef/cattle ranching, dairy and fish sectors. Soon every region of our beloved country will feel the positive impact of our intervention in the agricultural sector,” Emefiele added.

Ayo Teriba, CEO of Economic Associates, said the problem of poverty, unemployment and low access to finance were not as severe prior to 2015, but Nigeria currently faces a liquidity problem and the government needs to address it.

Teriba also raised concern about Nigeria’s $50 billion annual shortfall in liquidity which, according to him, can only be solved by supply management, not demand management. He also suggested that the CBN needs to move away from retail-driven solutions to wholesale-driven solutions.

“The infrastructures we need to attract FDI into Nigeria are currently owned by the FG and unless the FG offers to sell part of its stake in infrastructure, the country cannot attract FDI, which is what the Saudi government is currently attempting to do,” Teriba said.

Patience Oniha, director general, Debt Management Office (DMO, said private sector lending is required for the economy to grow, helping in the development of infrastructure.

“DMO is trying its best to use borrowing as a tool for development while also hoping that the country’s revenue also continues to grows,” said Oniha, who was represented at the conference by Oladele Afolabi, DMO’s head of portfolio management.

“Borrowing can help but cannot solve all our problems but we all need to focus on growing our tax to revenue which is a bit low,” she said.

Yemi Kale, statistician general and CEO, National Bureau of Statistics (NBS), said the statistical body would be paying close attention to unemployment rates and pressures on inflation rates, most especially the current minimum wage proposal and implementation.

“NBS will also be paying attention to other fiscal responses like VAIDS, social welfare programme targeted at the vulnerable in the society, impact of debt services on budget and challenges diversification of the economy faces,” said Kale, who was represented.

Franklin Ngwu, senior lecturer in strategy, corporate governance and risk management at Lagos Business School, called for devolution of power at the centre, noting that it would ensure effective participation by private sector.

“The central government is trying to do several things at the same time,” Ngwu said in a panel session moderated by Esiri Agbeyi, a partner at PwC, calling for more support for the SMEs in the area of access to credit.

Nonso Obiliki, chief economist at BusinessDay, harped on the need for more clarity around government policies, blaming government for implementing the wrong policies over the years which have yielded no result.

Echoing the thoughts of other panellists, Saeed Husiani, analyst at Control Risks, charged the government to address fundamental issues that fuel insecurities in the country.

HOPE MOSES-ASHIKE, DIPO OLADEHINDE & OLUFIKAYO OWOEYE