16 Sep

The week ahead – Finally, some motion on the economy

The federal government, as part of efforts towards reflating the country’s economy and pulling it out of recession, has summoned an economic session to brainstorm on the issue. President Muhammadu Buhari, his vice, Prof Yemi Osinbajo as well as ministers and heads of relevant federal ministries, departments and agencies converged on Abuja for a one-day retreat to discuss steps to salvage the receding economy.

Following increased hardship to Nigerians as a result of the recession, the Senate President, Bukola Saraki, has said that the Senate, upon resumption next week, will probe the cause of the recession. Saraki said that it was necessary to know why despite budgetary provisions, many more citizens have fallen below the poverty line. He claimed that the Senate on resumption will respond to the economic crisis with a number of measures including getting managers of the economy to account for the people, making tough recommendations to President Buhari on needed changes, formulating the necessary legislative framework for economic recovery and undertaking wide consultations across the private sector.

The Murtala Muhammed Airport, Ikeja, witnessed a blackout some days ago. This is not the first time, or the first airport in Nigeria, that such an event is taking place in. As a matter of fact, a few days later, there was a blackout in the Nnamdi Azikiwe Airport, Abuja. The Minister of Aviation blamed a Chinese firm without providing any further details. Reports have suggested that the frequent blackouts at the airport could be attributed to an organised syndicate at the airport who usually sabotage the power supply in order to execute their nefarious acts under the cover of darkness.

The Defence Headquarters has dismissed a threat made on the life of President Muhammadu Buhari in a new video released by Boko Haram militants. DHQ described the video as “the actions of washouts”, noting that the public had been appreciative of the achievements of the military in decimating Boko Haram. DHQ also said the only ground Boko Haram can go into, hide, and pretend to be alive, is social media, because “it is everybody’s home where sources can hardly be traced.” Brig-Gen Abubakar, the spokesman, said the military was committed to wiping out remnants of the group and people shouldn’t be deceived by their use of software.

Suggestions

  • The meeting called by President Buhari on the economy is long overdue. While Nigeria may have run out of monetary ammunition to address the growing recessionary influences on the economy, there is much that it can still do on the fiscal front. We have in the past said that while monetary policy such as floating the naira would stop us from digging the hole we are in deeper, a corresponding fiscal policy is how we will rise out of the hole. We advise that government rethink its ban on imported goods. We also urge the government to rethink price controls around petrol which threaten to reintroduce subsidy via the back-door. It is important to get money back into the economy, without the commensurate inflationary tendencies, it can bring. A good way is to borrow for infrastructure and it is advisable we explore every available lender for this. On taxation, the key is to make it simpler, and improve coverage, rather than shutting down businesses on increasing tax burdens. The key is to get businesses spending, contractors working and investments returning so that the massive job haemorrhaging can be reversed and people are put back to work.
  • Following Dr Saraki’s statement, we’d like to point out that there is no evidence that the Senate can do justice to the question of the recession facing Nigeria. The fact that they did not deem it fit to cut short their holiday when the recession was officially confirmed three weeks ago tells us a lot about their priorities or lack of them. We do not believe that they have the capacity to tackle such a matter. The way they can help the country is glaringly simple: they should cut down on their extravagant bonuses, and begin to address actual problems that can affect the lives of Nigerians. We also call on the Senate President to do that which is squarely within his purview to release the details of the National Assembly budget.
  • Our international airports are a shame to Nigeria. They represent everything wrong with Nigeria and her leadership. They represent both a security and an economic issue. The constant embarrassment that our airports constitute does more to harm Nigeria’s investment drive than many dare to acknowledge. We believe that this requires the highest possible intervention so that the Ministry of Aviation will be brought to account. Excuses that contractors cut cables should not cut it. There should be contingencies for situations where there are such power cuts so that power is restored within minutes. It is totally unacceptable to have hours of power cuts at the gateways to the nation. There should be a method of addressing these issues and the best-known models used to arrest the decay at the airports, not just the nation’s flagship international airport.
  • It was important that the DHQ publicly played down the threat, and this has been done. However, outside of the public glare, the DHQ should take this with all seriousness. Analysis of the video shows that the sect still holds some urban territory and command a significant following. The DHQ should be interested in finding out where this video was shot, which Nigerian territory they may be holding, and in ascertaining the group’s current leadership, troop strength, logistics and ideology. The group is in flux, with the ongoing leadership crisis and each faction of the sect might be under pressure to score a “big hit” to enhance legitimacy in their desperation to regain control of the group.