Getting Out Of Recession Is An Interplay Of Many Forces – Ugwu-Oju | Independent Newspapers Limited
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Getting Out Of Recession Is An Interplay Of Many Forces – Ugwu-Oju

Posted: Oct 14, 2016 at 3:30 am   /   by   /   comments (0)

Emeka Ugwu-Oju is the President of South-East/South-South Professionals of Nigeria, (SESSPN). He is also the founder of Nigeria and Entrepreneurship Summit and Honours (NESH). In this interview with TEMIDAYO AKINSUYI, he spoke on the way out of economic recession and other issues. Excerpts:

 So many experts have been giving conflicting views on when Nigeria will get out of economic recession.  While some said it will happen in the first quarter of 2017, others said it will take a cycle of three years. What is your perspective on that?

I think it is only God who can say a recession will start and end at a point in time.  If not, it means someone can conjure up a recession or drive away  a recession.  I believe it is an interplay of many forces. So, if you are in a recession, you work towards getting out of it. If you get it right, fine but if you don’t get it right, you go into depression which is much worse.  I believe it all depends on how the factors play out.  If for instance, they say ‘let’s reflate the economy’. If some of the factors of production that should be in play is not there, the reflation might lead into something else.  Also, you could reflate by way of government putting a lot of money into the economy. You might do that but what you put in is not enough.  It is when things work out that the resources you put in can work effectively and if it is enough, then you can be able to get out of recession.  The swiftness or tardiness will also determine how it will be.  If for instance, government says ‘we are going to pump in N1tr, and then that N1tr is pumped in one year later based on certain things we see in government such as bureaucracy or waiting for one person to decide to sign the disbursement of the funds, after much delay, by the time the N1tr was eventually pumped in, the factors have changed.  By the time you decided to reflate, you believe N1tr will be enough but by the time you get the funds, you discover that you will need N2tr based on changing factors. These are things that will determine how long a country will get out of recession.

There has also been argument about whether we are in recession or depression. What is your view on that?

Using the normal indices of recession, which is two negative quarters and other parameters, I believe we are in recession. We are not yet in depression and we pray we don’t get there.

So far, do you think the federal government is handling the situation right?

It is for Nigerians to be the judge; but from where I am observing things and also based on antecedents, where decisions are very slow for reasons I don’t know, if we are to use the past to judge the present, one can conclude that they might not get it right but we hope it wouldn’t be so.  The reality is that decisions on flexible exchange rate and decisions on partial deregulation of the petroleum downstream sector was a year late and that created  lot of distortions which wouldn’t have happened and wouldn’t lead to that degree if the decisions were taken at the appropriate time.  So, if the fiscal policies are timely in terms of what is being said to be done to get us out of recession, the journey may have started. But we just hope that the actual implementation is not delayed.

There have been strident calls for the president to reshuffle his cabinet. Do you think that will help?

The president has enough advisers who can advise him but I think the bulk stops on the president’s table. If he thinks he is not getting enough from his ministers, I believe he will act.

What is your position on the proposed sale of national assets as a way of revamping the economy?

I think it is the responsibility of the executive to see what best they can do in order to solve a particular problem.  The issue of sale of national assets is neither here nor there.  If you want to sell an asset to block a gap; for instance, there is a gap of N1tr and you decided to sell an asset worth N1tr to block that gap, next year,  if the gap is N2tr and there are no assets to sell, what do you do?  We shouldn’t look at sale of assets as a solution. If need be, It may be part of a holistic solution and in doing that, you have to look at how does it fit in?  We need to have what we might call a balanced budget, balancing of your income and expenditure. So, one needs  to take a decision  and not taking the easy way out in the short term which will be very damaging in the long term. Instead of taking decision on how to balance income and expenditure, you say ‘let’s sell assets’. Tomorrow when things get worse, there is nothing to sell. What will you do?  That is my opinion on the sale of national assets. It is neither here nor there.

The 22nd National Economic Summit commenced in Abuja on Monday. Do you think the decisions taken there will help in revamping the economy?

I think the theme of the summit is ‘Made in Nigeria’ which focuses on how to encourage made-in-Nigeria goods which is a good initiative. But we also as Nigerians are interested in how Nigeria will be better off and that is why I have founded a platform called Nigeria and Entreprenership Summit and Honours (NESH). What we are trying to do with this platform is to  bring Nigerian entrepreneurs; be it small, medium, micro-small medium and large under one roof so that we can have a big platform  that will be able to help us move the country out of economic recession. NESH will be in the forefront of promoting the patronage of Nigerian made goods and services by the governments and people , but on the condition that the goods and services will be made in Nigeria for the world and not for Nigerians alone. NESH will offer not only live hub but also build out an online platform (NESH TV) for and about entrepreneurs, offering advice , case studies, news and analysis. There will also be a NESH for young entrepreneurs aged 18 to 35 years named NESH-NXT. Some of the NESH-NXT attendees will also participate in the NESH to gain further insight and network with more experienced entrepreneurs.