Swimming Out Of The Recession Blues | Independent Newspapers Limited
Newsletter subscribe

Our View

Swimming Out Of The Recession Blues

Emergency Economic Stabilisation Bill 2016, buhari; recession; FG's blame game
Posted: Sep 5, 2016 at 7:01 am   /   by   /   comments (0)

To discerning economic watchers, Nigeria’s slide into its worst recession in 29 years has been beeping on their respective observatories. The symptoms were manifest.

With plummeting fortunes of crude oil prices in the world market, coupled with decimating output, the nation’s journey to the current abysmal profile was expected, moreso as the economic diversification agenda was vain gloriously been orchestrated with only lip service.

To further promote the rail-roading of the economy down-hill, the present administration enthroned a regime of unclear economic agenda that only succeeded in ushering in stag-nation. In fact, with challenges in the economy, accentuated by steep fall in oil production and prices, foreign exchange sourcing challenges, and rising inflation, the negative reading was a foregone conclusion.

With phenomenal shrinkage in key economic indices like Gross Domestic Product (GDP), employment rate and rising inflation in the first two quarters of the year, the present administration cannot afford, at this period of the nation’s economic history, not to think outside the box, to ensure that the recession period is not unduly prolonged. Specifically, the issues assailing the economy need to be holistically addressed as the pangs of the current hardship have been raining untoward effects on the socio-economic wellbeing of Nigerians.

For a start, the economy requires a robust stimulus package to reflate its current prostrate profile. Beside prompt release of capital vote for development projects, a wave of intervention initiatives should be implemented in favour of critical sectors of the economy. The government, as earlier stated by the Nigerian Employers Consultative Association, should pay heed to the imperatives of sustainable enterprise, as the mortality rate of businesses in the country currently remains alarming.

We believe that with the current widening account deficit, the nation needs to initiate a credible policy response, which must be complemented by an aggressive fiscal-side stimulation, to revive the dying companies in the real sector of the economy. Such initiative, which would improve foreign exchange supply, should be complemented by a correspondingly business-friendly monetary policy, to arrest the sliding for-tunes of the naira and ensure enhanced productivity and production within the system.

It is obvious that the lifeline required by businesses in the economy is improved infrastructure. No effort should therefore be spared in ensuring that challenges in the areas of power generation and supply, transportation, improved manpower training and development facilities, and healthcare are addressed.

Essentially, the much talked about economic diversification programme of this administration must be effected without delay. The nation’s over-dependence on crude-oil over the de-cades has been most unhelpful to the economy, as its current mono-cultural profile has put the nation under undue hostage of the commodity market’s volatility.

But in embarking on the diversification drive, the nation should move away from primary produce exportation saga, by ensuring that value-addition facilities are established to push the economy away from primordial tendencies of the past. For example, the current drive to reposition the agricultural sector must be matched with food processing plants around the country, so that harvests from the farms can engender technological transfers in favour of our youths.

This would also foster greater employment opportunities, to promote a more effective utilisation of our human resources. Similar policy measure should also find expression in the nation’s solid minerals sector’s development programme.

While the government’s plan to stimulate the economy with a record N6.1 trillion budget this year received accolades from stakeholders, the implementation inertia caused mainly by late approvals should not feature in next year’s expenditure plans. The optimism expressed by top officials that the nation would swim out of the recession in record time may not be assuring enough, given the current underperforming communications machinery of the present administration.

The bailout options need to be well communicated to the populace, to attract further contributions from stakeholders and there-by promote confidence in the initiatives. Definitely, this is the time to walk the talk, to make the nation swim out of the current recession, early enough, for improved socio-economic wellbeing of Nigerians.