The Minister of Transport, Mr. Rotimi Amaechi, said Nigerian economy has not collapsed as being speculated, stressing that the year 2016 is going to be tough given the fact that crude oil price has not stabilised. Also, a renowned financial expert, Mr. Bismarck Rewane has said that the Federal Government’s fiscal and monetary policies need to be harmonised in order to give investors confidence to invest in the country.
Speaking at the Business Eye Roundtable Discussion tiled “Nigerian Economy 2016 : Charting way forward , Amaechi said “We are going to have tough time in 2016, because the crude oil benchmark that the Federal Government fixed for the Budget is less than what the price is right now.
The Federal Government fixed N38 per barrel while the price now is less than N30 per barrel. Nevertheless, Nigerian economy has not bottom out as some people do say. With the corruption fight by Buhari’s administration and blocking of leakages, the economy will bounce back with time, but individuals have to make sacrifices.”
Continuing he said “If Nigerians had revolted during the period that public funds were missing and stolen things would not have been like this. He stated that the missing $49bn oil revenue, which the former Governor of the Central Bank of Nigeria, Sanusi Lamido, alleged that the Nigerian National Petroleum Corporation did not remit into the Federation Account, would be looked into.
He said, “Even before Sanusi and President Goodluck Jonathan began to quarrel, I had to leak that letter. Sanusi wrote that letter to the President in September, I leaked it sometime in January, and that letter was personal: ‘Mr. President, $49bn was missing,’ and I got a copy of that letter. “Instead of the Federal Government to say we are going to address this, they began to debate with the CBN governor and Nigerians join in the debate. Oh, it is not possible. Now, they have seen that is possible.”
Meanwhile, Rewane, who is the Managing Director of Financial Derivative Company, while analysing the economic situation of Nigeria said “The country is in crunch time. Government has budgeted 25 increases in expenditure; subsidy has been removed. But the missing thing is monetary policy stability. The exchange rate policy needs to be changed. We had money in the past and squandered it. Now crude oil price is less than the budgeted crude oil bench mark by the Federal Government in 2016 budget. The economic reality is that 2016 would be worst for sub Saharan Africa countries. Most country would seek IMF support, but Nigeria not inclusive. The increase in interest rate in US will continue and this will likely affect some countries.”
While, proffering solution to Nigeria’s dwindling economy, Rewane said “There is need for the monetary policy to compliment the fiscal policy. There should be exchange rate adjustment to enhance investors’ confidence. Also, there is need for more investment in the country. So government must provide infrastructure and the ease of doing business in the country must be enhanced. Presently, the exchange rate is inefficient, so the potentials are enormous for the country. We get N21 billion remittances a year into Nigeria from people living abroad. So, if there is stability in exchange rate people will be willing to invest in the country. Investment is what is needed to grow the economy.”
In his own comment, Mustapha Akinkunmi, Lagos State Commissioner for Finance said “Lagos State is doing well compared to other states because of prudent management. We are not going to increase tax given the state of the economy. We are doing well because of the efficient collection of taxes; we are going to deploy more technology and use private sector for the collection. Our budget is 24 per cent higher than the previous year. So, state governments need to be business friendly. Dangote invested in Lagos because of the business friendliness of Lagos.”
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