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Over Reliance On Imported Goods, Bane Of The Naira – Adegbenro



Otunba Adejare Rewane Adegbenro is a Lagos based entrepreneur with passion for the growth of the nation’s economy. In this interview, he suggests ways through whichNigeria can grow her economy and reduce inflation. TUNDE OGUNTOLA met him

How is the economy fairing under this administration compared to what was obtainable before?

It is clear that these are trying times for businesses in the country but with the way things are being done by this government, there is hope for a brighter future.

As a country and people we have to change our ways of ‘business as usual’ and be willing to make sacrifices for a better tomorrow. With the investments being made on infrastructure, agriculture, power and the ease of doing business initiatives, we are heading in the right direction. There are so many sectors opening up, the attention to ICT presently, for people with open mind and willingness to work, the opportunity is huge.

Are you comfortable with the pace the government is going in handling economic matters?

The government is a work in progress. As it is, there are a lot of issues to contend with all at the same time and expectations are very high. But we must be realistic and be patient. We must admit that the way we do things must change. It is obvious things will be tough initially before they get better. However, if people are complaining as much as the government is doing now, it means that the government is not doing enough in terms of awareness to let the people know what they have done so far. However, I would score it 65 per cent from about 30 two years ago. With the diversification of the economy away from oil and other export items on the increase, we will be able to generate more and employ more people.

As an entrepreneur, what economic indices do you use to arrive at your points?

A government that is interested in completing abandoned infrastructural projects like major roads, railroads, power projects and agro-allied projects is a government that is interested in getting the country working again. With the stable production of crude in Nigeria and fairly stable oil price, this government has the opportunity to diversify this economy and shift focus and over-reliance on oil. If this government can also focus on setting up modular refineries that work in all the geo-political zones of the country, huge savings will be made in the forex used in importing petroleum products. The government should increase and encourage loans for SMEs across all vocations, ethnic groups and fields across the country. Many unemployed youths can and would make use of business opportunities if government creates a platform for awareness because most of them are ignorant of dynamics of economic changes in our environment, both locally and globally.

Are you comfortable with the steps taken by this administration to turn the economy around?

Yes. However, there is a lot of room for improvement. The government should focus on youth and sports to curb crimes and position the country for exportation of talents in the short to medium term. Large allocation of the budget should be made for health and education with strict monitoring of usage of resources. The school curriculum should be reviewed to include basic sports like, football, swimming, gymnastics and basketball and so on.

By your personal assessments, is Nigeria truly out of recession?

No, the country is not totally out of recession. The cause of the recession in the first place was an imported inflation characterised by devaluation of the Naira with a resultant multiplier effect of increase in the prices of goods and services. Until the pressure placed on dollar by the country’s over reliance on imported goods are tackled, the value of the Naira will continue to depreciate and the country will always relapse into another round of recession. The government should focus on things that can generate forex and ensure that we produce most of the things we consume like food, petroleum products and export things that we have that the world needs like bitumen, solid minerals and the likes.

What can the government do to bring the  US dollar at par with the naira?

This will be a long and enduring journey but it is not too late to start. The government should continue with the investment in agriculture but it needs to upscale to processing the produce from the farms or empower entrepreneurs that are interested in processing to do it. It needs to open up other ports across the country to ease the clearing of imports and exports to reduce the cost of inputs and factors of production. The government should set up modular refineries that work in all the geopolitical zones of the country to support the production from the Dangote refinery and save the forex used in importing petroleum products. Invest in health and education, sports and youth and reap the reward in few years’ time.


Can we have your assessment on the roles the CBN played in bringing the collapsing economy back to its feet?

The role of the CBN is to ensure implementation of economic policies that drive growth and sustainability. Any deviation from this is a failure on the part of the country reserve bank and the captain of the ship which is the governor of the bank. With the various interventions in the forex space to defend the Naira, the CBN and the governor had done well in my opinion.

However, the CBN should have a more inclusive monetary policy implementation where all stakeholders are well consulted before implementation to avoid policy summersault as we have had in the case of sovereign guarantees giving higher yields than corporate guarantee. The governor has done a lot to bring more people from the informal into the formal sector. The BVN was a great initiative but a lot more needs to be done to increase from about 15 per cent to at least 40. This will go a long way in helping banks develop decent retail banking sector that helps more people have access to loans.

Is there anything that could be done to arrest inflation?

I believe so. The government should first understand that the inflation in Nigeria is a cost-pull inflation where the cost of factors of production are high because they are predominantly imported and cost of clearing at the port has also hit the roof due to lack of proper planning and over reliance on a single port by the government. It is obvious that there is an urgent need for the other ports like Calabar, Onne and Port-Harcourt to be fully functional. This will reduce the cost of clearing and haulage and also reduce pressure on Nigerian trunk roads. Also, Nigeria should stop importation of items that can be produced in Nigeria while looking at producing things we have that are in high demands globally like bitumen, solid minerals, cocoa and cashew.

How can the government create jobs to reduce the rate of unemployment and crime?

Government should make policies that aid all the above mentioned. This will see businesses growing and expanding and other new businesses also springing up with foreign investment opportunity coming into the country. All these will give rise to increase in demand for labour and unemployment rate will reduce automatically. Government should also pay more attention to appointment and allocation of responsibility to ensure that the best brain available in the country and relevant to work requirement are appointed into offices irrespective of whether the person is a politician, party member or not. It should also set up an appraisal system, for the public officers to ensure periodic assessment of activities. This will ensure excellence in the carrying out of the function of all public officers.

The government should also not appoint anyone it cannot fire. It should encourage training of its officials in all sectors. This will help in making right decisions that would put the economy to having world class standard. I also suggest that politicians and few others, who live larger than life, shouldn’t be overpaid. The concept of immunity for governors and other executives should be eradicated as this has paralysed and still paralysing our economy.