Economic Recession: APC’s Search For Remedial Measures

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The over N6trn 2016 budget by the All Progressives Congress (APC) led government which was designed to revive the economy is the most ambitious yet by any administration in recent times. This template for the economy raises the hope for a better 2016. But the hope appears to be waning, CHIBUZO UKAIBE and ANDREW ESSIEN write.

With the economy in recession, Nigerians are becoming increasingly concerned as to how the APC-led federal government which prides itself as a harbinger of change intends to make good on its campaign promises and deliver the much-needed dividends of democracy.

The anxiety that greeted the government for keeping its economic blueprint for too long was largely expected going by the slow in the economy and the attendant high cost of living. But with the budget estimate finally laid before the National Assembly, expectations have moved from how the party intends to go about fixing the country, to how it intends to implement “the budget of change”.

The APC-led administration came into governance, as the National Chairman of the party, Chief John Odigie-Oyegun puts it “when the nation was finally brought to its knees and the people recognized that the nation needed saving and so they rallied around the personality of President Muhammadu Buhari to do what has never been done before or what most people thought was impossible.”

He continued “The people had finally had enough hence they rallied around the personality and the name they could trust to bring about real, genuine and positive change.”

After the presentation of the budget, APC’s National Chairman, John Odigie-Oyegun, said that the promises made to the Nigerian electorate by the party in the course of the 2015 presidential campaign are captured in the proposed 2016 National Budget just as he added that the present administration’s pro-people policies would be implemented full blast in the coming 2016 financial year.

In an interview, Mr. Rotimi Fashaki, a former National Publicity Secretary of the defunct Congress for Progressive Change (CPC) one of the legacies parties that formed APC, was quoted to have said “In 2016, looking at the budget of past governments in the last five years, you will find out that the budgets were about N4tn. Now, this government is making a budget of over N6tn.

“That should tell any Nigerian that this government is conforming to the postulation of a notable British economist like John Reinhard King, who said in the 1930s during the depression that at the time of depression is when the government should be the big spender; to invigorate the economy, jack up the nation and spend all through the recession. From the budget (proposal), it is clear that this government is going to spend and spend real big. We will improve on a lot of infrastructure.

“There will also be tough decisions to be taken. Our hitherto undisciplined lifestyle may have to give way for us to toe the line of rectitude and transformation.”

The administration’s desire to revamp the economy was always going to be on the front burner in 2016. This is despite the plummeting oil prices, the government expects Nigeria’s economy to grow by 4.4 percent next year.

“The 2016 budget, as outlined, is designed to ensure that we revive our economy, deliver inclusive growth to Nigerians and create a significant number of jobs,” the president had said during the budget presentation.

With capital expenditure expected to gulp about N1.8 trillion, the government is marking a significant over 300 percent increment from the 2015 vote of N557 billion.

But since then, the economic continued in a downward spiral. Largely, the bombing of oil pipelines by Niger Delta militants affected the mainstay of the economy, stifling an already dwindling revenue from crude oil, whose price at the international market has fluctuated within the 40 dollars mark.

The ace opposition party, Peoples Democratic Party (PDP) leveraging on what they described as poor handling of the economy since the passage of the budget, called on the president and his cabinet to resign if they are not able to keep the economy afloat.

The party in a statement said “We join all well meaning Nigerians to call on President Buhari to resign if he is unable to reverse the disastrous economic decline he has brought on Nigerians.”

This call was just hours after figures released by the National Bureau of Statistics (NBS) confirmed that Nigeria had slipped into recession. The NBS said Nigeria’s Gross Domestic Product contracted by 2.06 per cent, marking the first major recession in 29 years for Africa’s largest economy.

The statement as signed by the party’s director of new media, Deji Adeyanju, further saw the crisis as a direct consequence of the President’s “ineptitude and incompetent” approach to economic management which were a rehash of the “archaic and incoherent economic policies” he similarly pursued as the head of a military junta between 1983 and 1985.

“Nothing better showcases the absolute ineptitude and incompetence of the Muhammadu Buhari administration than the GDP, Inflation and unemployment figures released by the Nigerian Bureau of Statistics today.”

Analysts had long predicted that Nigeria’s economy was heading for a recession as the Naira continued to fall amid diminishing revenues occasioned by low crude prices.

The downward spiral has led to an increase in the number of Nigerians struggling to eke out a living, fueling fears of an outbreak of social unrest.

Behavioural economic experts and religious leaders recently raised concerns about the dangers of leaving the country’s expanding youth population without means of livelihood for too long.

Dismissing PDP’s criticism however, the APC has often assured Nigerians that the its government under President Muhammadu Buhari will actualise its promises made to the citizens during the presidential campaign, as evident in the 2016 budget.

The call by the PDP on President Muhammadu Buhari to resign also attracted the attention of the ruling APC as the party has called on the PDP to apologise Nigerians for plunging country into economic bakwardness through what it described as “voodoo economics and reckless fiscal policies” rather than engage in a silly call for President’s resignation.

The APC further stressed that the the Buhari-led administration is open to and welcomes positive and constructive contributions on resolving the country’s economic challenges.

This was contained in a terse response signed by the party’s national secretary, Mai Mala Buni and issued to journalists on Thursday in Abuja stressed that “Instead of this charade by the PDP, we advise the PDP and their cronies to apologise to Nigerians and toe the path of honour by returning public funds stolen under its watch.

The APC further said “the PDP faction by its demand to return the country to the years where looting of the public treasury was the order of the day, has taken its orchestrated plot to deflect attention from the economic mess it left behind to new insensitive and shameless heights.

“While the PDP attempts to fraudulently re-write history and misrepresent facts on its misrule of the country, Nigerians are traumatised on a daily basis on disclosures of the startling level of pillage of the country’s commonwealth perpetuated under its watch. Instead of saving for the rainy day, past PDP administrations and their cronies literally looted the public treasury blind, using the loot to build luxury hotels and other properties, stashing loot in farmlands and hidden bank accounts.

He also assured Nigerians that the President Muhammadu Buhari administration is already employing all legitimate and innovative means to restore the country’s battered economy back to health in the quickest possible time.

Clearly, all eyes are on President Buhari just as the expectations gets higher with each passing day.

The recent retreat on the economy points to a troubled president anxious to generate ideas “out of the box”. For a president who perceptibly had a laid back disposition towards radical economic policies, his declarations at the retreat, themed is “Building Inter-ministerial Synergy for Effective Planning and Budgeting in Nigeria”, portrayed an intent to clear doubts of concerns over his ability to turn the economy around.

Although the outcome of the retreat is tailored more towards the process of developing the 2017 Budget, Buhari had said it was “coming at a critical time in our economic history, when the Nigerian economy is in a recession, with significant downturn in performance in various sectors.

“It is with regard to the importance of this Retreat that I decided to sit through the first part of the session to listen to the views from experienced economists and development experts on how best to implement our plans to rid the country of its oil dependence and to diversify the economy and bring the country out of the current economic recession.

“This is in line with our Administration’s determination to lay a solid foundation for growth and development as outlined in the Strategic Implementation Plan (SIP) of our Change Agenda.

“Given that this Retreat is a lead-up to the 2017 Budget, my expectation is that we will come out of the these sessions with a determination and common position on how to have improved synergy amongst the various Ministries and Departments for the effective formulation and implementation of the 2017 Budget.”

He however disclosed that some ministries may get significantly less capital allocation than they received in 2016, while others may get significantly more.

“Indeed, the challenges we face in the current recession require ‘out-of-the-box’ thinking, to deploy strategies that involve engaging meaningfully with the private sector, to raise the level of private sector investment in the economy as a whole.

“We are confident that the level of private investment will grow as we are determined to make it easier to do business in Nigeria by the reforms we are introducing under the auspices of the Presidential Committee on Ease of Doing Business.

“Let me reiterate that this Government will continue to strategize on how we can turn the current challenges into opportunities for our nation and especially for our vibrant youth on whose shoulders lies the future of this nation.

“This is why we have embarked on measures and actions that will open up the opportunities we have seen in the Power, Housing, Agriculture, Mining, Trade and Investment, Information Communication Technology (ICT) Sectors, Tourism, Transport and other sectors.

“I wish to reassure its teeming youth that this Government would remain steadfast in its effort to ensure greater progress and prosperity for you.

“While Government is taking the lead in the task of repositioning our economy for Change, we cannot achieve this completely by ourselves. We will need, and we ask for the support and cooperation of the private sector’s domestic and foreign investors, the States and Local Governments, the National Assembly and the Judiciary as well as all well-meaning Nigerians in this important task. We are confident that working together, we shall succeed.”

Still, while the dividends of the retreat may not come immediately, analysts believe that the by-in of the National Assembly will be crucial.

However, the move by the presidency to seek emergency powers to arrest the raging economic challenge, has not gone down well with some law makers and analysts.

The emergency bill, according to reports, will among others, seek to curtail the procurement process with a view to assuring stimulus spending on critical sectors of the economy.

This will enable the president make orders to favour local contractors/suppliers in contract awards; abridge the process of sale or lease of government assets to generate revenue; and allow fervent of budgetary allocations to projects that are urgent, without recourse to the National Assembly.

The Bill also seeks to amend laws to reduce stringent condition such as those related to the Universal Basic Education Commission (UBEC) Act, preventing states the access to their cash trapped in the commission’s accounts as a result of their inability to meet the counterpart funding can do so.

While there are rumblings from some lawmakers over the bill to the effect that it could make an already power president too power, the presidency has since denied media reports that President Buhari is seeking emergency power to stimulate the nation’s ailing economy.

The senior special assistant to the vice president on media and publicity, Laolu Akande, said although the ‘‘economic management team has indeed been considering several policy options and measures to urgently reform and revitalize the economy…..

‘‘As far as I know, this has not been passed on to the president, the FEC or legislative arm of government’’.

However a former governor of Abia, Chief Orji Kalu, believes such emergency law is the right way to go. He encouraged President Muhammdu Buhari to initiate policies and legislations that will bail Nigeria out of the current economic recession.

Orji while speaking with newsmen in Umuahia last Friday, said “The president should push for an emergency law that would help to stimulate economic growth and bring the country out of recession.

“The moment the manufacturing sector attains full-capacity production, there will be less dependence on importation and this will shore up the value of the naira,” he said.

Kalu said that the activities of Niger Delta militants further aggravated the nation’s dwindling revenue, leading to a full-blown recession. He said that he first noticed the signs of economic recession in the country in 2014, when the Federal Government borrowed to pay the salary of federal civil servants.

From those who have lost hope to those who have been unable to find gainful employment opportunities, from citizens for whom the access to basic necessities of life remains a tall dream to those who cannot even go home because of insurgency, the wait on this administration to provide the change it so boldly promised is becoming longer than they expected.

What’s more, for a population that has been let down by successive administrations, many are skeptical, particularly as the full implementation of budgets in Nigeria has largely remained a mirage.


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