THE NIGERIAN ECONOMIC CRISIS: The Way Out

by John Uzie

The Nigerian economy has been in a state of decline as a result of drastic fall in crude oil prices globally since the middle of 2014. The Nigerian economy as at today is in a  recession, this is the reality. The Nigerian government has been on the defensive, blaming the PDP for failure to manage and diversify the economy during the years of high crude oil prices.

The PDP on its part blames the APC-led Federal government for lacking an economic blue print to salvage the Nigerian economy.  Enough of the blame game, cost of living has become tough and hard for many families, the organized private sector has been laying off thousands of workers, crime rate is on the increase, Federal, State, and Local governments are finding it difficult to pay salaries of workers and pensions for retirees. 

The assurances and promises coming from the government is not enough, it is time to work the talk. 

Here are some suggested ways to resolve the Nigerian economic crisis;

1. A stable exchange rate for the naira: 

the decision by the Central Bank of Nigeria on June 21st 2016 to further devalue the naira has proven to be a step in the wrong direction. The effects of this decision has been high inflation rate, increase cost of doing business for manufacturers, increase in the cost of goods and services. Where are the foreign investments that where promised? Are black market Forex traders out of business? Has the quantity of dollars available to the CBN increased?  Has the CBN lifted Forex restriction on some select items?

The Nigerian economy as it stands today cannot benefit from a weak or devalued naira, countries that benefit from a devalued currency are those with a wide range of goods and services for export, and countries with a high rate of visits by tourist, these conditions are not applicable in Nigeria.
The CBN and Federal government should come out with a realistic, feasible, and Nigerian based solution in fixing a stable exchange rate for the naira.

2. Reducing the cost of governance: 

the cost of running the Federal, State, and Local governments in Nigeria remains high. The Federal government needs to merge, and scrap some MDA's, government staff from scrapped MDA'S should be distributed to MDA'S with manpower shortages. The states and local governments should do the same. A comprehensive staff audit should be carried out by all arms government to weed out ghost workers. The number of political appointees should be reduced by 50 percent. The cost of running government houses should be reduced by 60 percent. Reducing the cost of governance will make additional funds available for infrastructure and developmental projects.

3. We need to buy made in Nigeria products: 

when we buy imported biscuits,  cornflakes, soaps, toothpaste, body Cream, rice, household items, vehicles and equipments, we deny Nigerian companies needed revenue and expansion. We also put pressure on available forex. Nigerian companies cannot expand and create job opportunities for our citizens. The Nigerian government should lead by example, importing vehicles for use by officials is wrong when we have made in Nigeria vehicles. The responsibility to sustain and improve the capacity of Nigerian Manufacturers and producers rest on the government and it's citizens. If we fail to help and support our products, no one will do it for us, Nigeria eventually becomes what we make it to be, a nation does not make men, men make a nation.

4. Diversification of the economy:

Nigeria's economic woes have been compounded by low oil prices and the continuous destruction of oil and gas facilities by the Niger   Delta Avengers and  other militant groups in the Niger Delta. A quick and speedy resolution of the attacks on oil assets is not in sight, the government should wake up to this reality, the Nigerian economy can no longer survive on crude oil export. The Federal and State governments should actively work with genuine local and foreign investors in the areas of mining of solid minerals, manufacturing, refining of petroleum products for local consumption and export, and agricultural products for export.
The government needs to help improve the capacity of local farmers, this will guarantee food security, and eventually bring down the cost of food items.

5. Judicious use of recovered looted funds: 

funds recovered from the government's war on corruption should be used to fund critical infrastructural projects that will impact the economy. Attention should be given to power projects, modern health care facilities, completion of Ajaokuta steel project, critical national road network, etc. All legal bottleneck hindering the utilization of these funds should be resolved with out delay, plea bargain should be accepted for those willing to return their loot. Years of protracted legal battles to recover these loots will not help our present economy, the funds are needed now to rebuild the Nigerian economy.

6. Nigerians need to be patriotic: 

the task of  rebuilding the Nigerian economy is not for the government alone, it is the duty of all Nigerians, unpatriotic activities such as hoarding of Forex , over pricing of goods and services, traveling abroad to patronize services that can be rendered in Nigeria, and all acts economic sabotage will not help the Nigerian economy to recover.

The government and citizens of Nigeria at no other time than  now, need to collectively work together to restore the nation's economy. The success or failure of the Nigerian economy lies in our hands.

- John Uzie