Kingsley Moghalu, a former deputy governor of the Central Bank of Nigeria has criticised the lack of shared sacrifice from the political class in the face of the economic downturn ravaging the country as one of the banes of President Bola Tinubu’s reforms.
Moghalu, in a statement on his X handle on Friday noted that while the economic policies were “hurriedly” made, Nigerian leaders are not putting themselves in the shoes of the citizens bearing the burden of the reforms.
“Executing painful reforms requires the legitimacy of shared sacrifice. That such a sacrifice on the part of the political leaders of Nigeria is absent, while asking citizens to bear the pain of necessary (although incompetently executed) reforms damages the legitimacy of the reforms,” Moghalu said.
He stated that the petrol subsidy and the forex subsidy were unsustainable, adding that in removing such subsidies the government ought to have provided alternatives to absorb the shocks that would follow afterwards.
The former presidential candidate faulted the unification of the FX market and subsequent flotation of the naira without tightening monetary policy and a designated central bank governor.
“The fact that the wrongheaded execution of their removal – removing the petrol subsidy hurriedly without proper planning for consequences and alternative transport solutions for the people, and floating the exchange rate without FIRST tightening monetary policy and without a substantive @cenbank Governor with a real plan in place — is a very different thing from whether those reforms were needed,” he said.
The former deputy governor of the CBN stated further that the issue behind the reforms was competence of conception and execution.
At the very instance President Tinubu was sworn in some 12 months ago, he declared: “subsidy is gone”, marking an end to the era of the fuel subsidy regime. Soon after, the government floated the naira, leaving its value to be determined by market forces.
But these policies do not come without ripple consequences. The very immediate effect was an instant rise in transport fare which fuelled an increase in food prices and other essential commodities.
Though Nigeria’s headline inflation has been on the rise before the reforms, they spiked it and now stood at a near three decades high of 33.69 percent in May.
Moghalu, however, argued that the economic mess could have been averted if the reforms had been properly framed and executed.
