Nigeria’s incumbent president, Goodluck Jonathan and his main challenger at the February presidential elections , former military head of state, General Muhamadu Buhari, have been advised to consider and exhaustively discuss six quick facts about the Nigerian economy and their strategies for dealing with them, if they get elected into office next month.
A gathering of economists spoken to by BusinessDay last week, said the number one quick fact is lack of capacity in government for quantitative policy analysis required to reveal sensitivities of variables for decision making in the country.
The economists who BusinessDay spoke to include a professor of Economics who was once adviser to a Nigerian president. We also spoke to another professor of Economics who retired from a Federal Government Think Tank. Another was a Peoples Democratic Party chieftain and economic strategist to the Obasanjo administration.
The economists identified the consequences of this lack of critical capacity for policy making to include the possibility of monetary and fiscal policies not being properly coordinated to achieve desired results. “Part of the reason is that we do not have quantitative models to determine policy sensitivities of various measures being taken, as to their complementarities or the possibility of their cancelling each other out” a former minister and economist speaking anonymously told Business-Day.
“We do not know the time-lags required by the policy measures being taken by CBN and the finance ministry to play out. No models. Just largely rule-of-thumb and common sense. This makes it difficult for people outside government to make meaningful contributions to policy debate within the context of participatory and inclusive governance”, he added.
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The second quick fact on the list, states that although the Nigerian economy is large, as measured by GDP (some $510bn in 2013), it is largely based on primary production.
Thirdly, and as a consequence of the second quick fact, the size of the Nigerian economy does not translate to a strong economy because the growth the economy has experienced in the last decade remains largely fragile.
Fourthly, over-dependence on one commodity as a source of forex earnings has been decried for many decades without commensurate measures for diversification of sources of forex earnings.
Fifth, the GDP rebasing exercise has revealed the structural weaknesses in the economy that need to be addressed through proper planning.
Lastly, they said the Nigerian government often loathes planning (ie hates planning) because of the orientation of key officers in government.
To rescue the country from the debilitating consequences of the foregoing six quick facts about the Nigerian economy, the economists called on President Jonathan and his main challenger at the presidential ballot next month, to consult their economic strategy teams and tell Nigerians what they will do differently to take the Nigerian people to the next level of shared prosperity.
