Lai Omotola, group managing director, Masters Reality International Concepts Limited (MRICL) and chancellor of E-Boot Camp Limited, in this interview with ZEBULON AGOMUO, shares his thought on the implication of the recession for citizens of Nigeria and businesses. He advises handlers of the nation’s economy to roll up their sleeves and get to work. Excerpts:
How did you receive the news of Nigeria slipping once again into recession, second time in five years, and what do you think this means for the ordinary man on the street?
The first thing is that the news of recession would psychologically weigh a lot of people down. The meaning of that to an ordinary man on the street is that a lot of people that that ordinary man would want to do business with or would want to collect money from will hide under the excuse of recession to say that things are not going well and it would have an impact on the ordinary man. Furthermore, is the fact that when there is recession, the prices of goods and commodities would definitely go up; which has been going up even before the recession. It means that food items, the cost of transportation, cost of healthcare would be expensive, given the fact that again the pump price of petrol has gone up. So, the ordinary man on the street is going to see hell going forward. By the way, it is not only the ordinary man that this will affect; it will also affect businesses; it is going to affect the entire country. Businesses are going to suffer setback. Businesses that had already been shut down as a result of the Covid-19 will find it difficult to reopen. Many businesses that are struggling will finally close down. So, the recession will affect everybody. It goes to say that it will have a negative impact on everybody.
With the level of borrowing by the current administration, which means there are no buffers for the rainy day; how do you think the country will navigate the dangerous waters?
Yes, government has been borrowing. It borrowed from World Bank; borrowed from China for railway, borrowed or about to borrow from Brazil. Now, government continues to borrow. When you even look at the budget, it seems to you that there is nothing else the government can do than to borrow looking at the budget of Nigeria. When you have an N8trillion budget and you have a deficit that government is saying that they are going to borrow; the impact of this on businesses is that at the end of the day businesses are the ones that will suffer. How? There would be increase in taxes; taxes would continue to go high. Government would continue to look for ways to siphon money from businesses that are doing well, putting obstacles in front of them. At the end of the day, businesses are the ones that will suffer for this continuous and excessive borrowing. I think that government needs to look inwards and reduce the rate at which they borrow. With the way they borrow, when another government comes in place in the next three years, that government is going to have difficulty in expanding the economy of Nigeria.
From the look of things, it seems there is going to be a bleak Christmas where many people may not be able to have the opportunity to celebrate it on account of the economic hardship in the land. Do you see anything contrary to the postulation?
This is a Covid-Christmas that is coming. Ordinarily, one would think it’s about the blow of Covid-19 on Christmas not knowing that this is not only Covid-19, this is a double dose of Covid and recession Christmas coming up. From what we can see now, it is indeed, going to be a bleak Christmas for ordinary people and we have to be security alert, because when people cannot eat; when people cannot feed themselves they will begin to look at other means that are unlawful to make ends meet. So, security needs to be beefed up and people need to begin to see how they can be their brother’s keeper.
What would be your advice to government and all those that handle the economy of Nigeria?
I have always said that for this economy to grow, or to come out of the woods, we have to begin to be productive; it is not about commission-seekers; rent-seekers, politicians putting money on the ground; it is about being real productive. How do we become productive? As a country, we should be able to feed ourselves. We should be able to clothe ourselves, create shelter for ourselves; Nigeria should be able to have good transport system and manufacture basic things. We should be able, as a country, to feed ourselves up to 99 percent. When that happens, unemployment rate will go down. That’s number one. Number two, there should be massive construction going on for housing. Number three, we should begin to produce. The fact that we missed the industrial revolution does not take it away from us not to produce. Lack of productivity is what is putting pressure on dollar, and because the dollar rate is high and we are importing everything; we are spending so much money on imported goods. Therefore, we must begin to look toward a knowledge-based economy that leads to a productive economy. Anything short of this, we will just be running round the circles, and we will still be telling the same story, year in, year out. My final advice is for them to roll up their sleeves and get to work, and get their hands dirty. The problem with the Nigerian economy is a pedestrian problem. It is not a major problem. But when people are not truthful to themselves, or are not willing to be transparent, but just for their own selfish interest, things will continue to go wrong. The money to take Nigeria out of the woods is in the houses of politicians, in trillions of naira. Nigeria continues to go and borrow money when trillions of naira is hidden in different locations within the country and abroad. The country continues to go begging when politicians have looted trillions of naira since the advent of democracy in Nigeria.
