Buhari And The Economy By Abbiba Princewill

by on October 30, 2015

In April 2014, most Nigerians received the news that we had become Africa’s largest economy with apathy. This apathetic attitude is perfectly understandable, as the vast majority of our population have not benefited in any meaningful way from the incredible growth rates of the past 15 years. We still have a situation where over 63% of Nigerians live in grinding poverty, have no access to clean water, toilet facilities and a functional health care system.

 It is hardly surprising that when President Good luck Jonathan fired the eccentric but rather outspoken CBN Governor, Lamido Sanusi who during his time at the helm of the CBN created interventionist funds to give support to the real economy i.e (agriculture, recovery from the 2012 floods and Boko Haram attacks) most people felt, and rightly so that this breached the independence of the Central Bank.
However, under the new CBN governor the pendulum has swung too far in favor of the Central Bank.
The remit of the bank is in the area of monetary policy but the new governor appears to have the ears and confidence of the president and in the past 5months, the bank is making both fiscal and monetary decisions that would have a long term impact on our economy and possibly impede growth.
The 2015 elections promised 3 things.
1. Security, 2. Corruption and, 3. Economy.
Specifically, 25 million poor Nigerians where promised 5000 Naira a month, kids in public schools were promised free school meals. All this promises can only be fulfilled when we have a diversified source of revenue and a robust and growing economy. We can only have a growing economy when we have an economic team that is intelligent, and creates policies that are reflective of the nature of the Nigerian economy.
Sadly, this is not the case.  The monetary policies coming out of the President’s economic team , particularly the forex policy has put a huge burden on small, medium and large-scale businesses that depend on foreign currency to import machineries and goods for their businesses.
The impact of this policy can be seen in the very discouraging Q2 figures released in July, the economy only grew at 2.35%, it’s slowest since 2001. Our stock markets have lost trillions of Naira in value and are still shaky. FDI flows into the economy have declined substantially; the confidence of the business community and foreign investors in our economy has plummeted.
All of these economic troubles will unravel in 2016 where we could potentially be facing a recession. The ruling party has made so many promises to the 63% of our population that for once in a very long time are hopeful and expectant. They expect their 5000 Naira monthly, they want their free school meals, they want Boko Haram crushed.
All this cost money, we need to grow a larger cake, we need our economy back on the path of robust growth so that we can meet the expectations of the other 63% and continue to deliver for the 37% living above the poverty line.
Therefore, it is important that President Buhari remembers that in the end the failure or success of his government would be decided not by his anti corruption stance but by the economy. The economy led to his downfall in 1985. He needs to pay more attention to the bread and butter issues, inflation is up, interest rates are atrocious, unemployment and underemployment is stubbornly high, access to credit is almost impossible and this  new Forex policy is unpopular.
Finally, he is in the last days of his honeymoon period and 2016 would bring a lot of rumblings. The edifice that was built around him in the last elections is beginning to crack. He needs to act ASAP by gathering a strong economic team that can sit down and debate amongst themselves before introducing policies.  The CBN governor should not be the only voice on the economy.
President Buhari, the economic clock is ticking………..
The Writer can be contacted on Twitter : @Bibbs_A
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