The socio-political situation in Nigeria has called for an overview to offer an insight into the true state of the nation. Regardless of what politicians and public officeholders are peddling in the media about the economy, the fact remains that it is the citizenry who are better positioned to evaluate governance based on their own economic realities. All through the ages, people bear the brunt of governance, whether good or bad; they wear the shoe and know where it pinches.
In recent times, some government officials have taken turns to regale us with their own version of the economic situation in the country. But most of those speakers are only commenting from their own political lineages, instead of giving a true picture based on the facts.
This article is particularly responding to the comments of the Director-General of the National Orientation Agency (NOA), Dr Garba Abari during an interview he granted the TM News, where he affirmed that Nigeria’s economic recession started in 2013. This is far from the truth. We all know that the economic performance under the Jonathan administration in 2013, reported at 5.4 percent then, was far better than what we have now.
Recession is a negative growth, to start with. It can be understood by looking at certain economic indices such as the Gross Domestic Product (GDP), employment, inflation rate, risk of doing business, etc. According to the former governor of the Central Bank of Nigeria (CBN), Prof Chukwuma Soludo, the size of Nigeria’s GDP has dropped by half in dollar terms in less than two years of the Buhari administration. Soludo, in his review of our economy from May 2015, affirmed that the GDP dropped from $575 billion to between $354 and $232 billion, a situation which makes the Naira lose both first and second position in Africa GDP’s rating.
The former CBN governor also said that at the interbank rate of about N375 per dollar, the GDP was around $288 billion, while the parallel market rate of about N465, the figure was closer to $357 billion. He further said the country’s economy was not only in recession in domestic terms, but has suffered “massive compression” in dollar terms. Prof Soludo, who made this statement at a Vanguard Newspapers event titled: “The Hard Facts to Rescue Nigerian Economy”, added that though the Buhari administration inherited a bad economy, it only won the microeconomics battles while losing out on the macro economy.
The former CBN governor criticized the financial policy of the current administration in the area of command and control measures, exchange rate control, and massive capital flight, which he says were responsible for the recession. Recent stats show that inflation has moved up from 9 to 19 percent, exchange rate from 197/215 to 305/380, unemployment from 7.5 to 14 percent, and the GDP from 2 to -1.56 percent. Also included is the business confidence which remained very low at -29 while competitiveness index was also low at 3.39 points, a figure making the nation rank the 124th worldwide.
The Nigerian workers are not spared from the recession-driving Buhari administration. They have suffered a double blow: declining average nominal wages, shrinking real wages with high inflation pressures, collapse asset price and shrinking household wealth.
In 2016, the economy experienced a negative growth of minus 1.6 percent; the first in 24 years. This is rewriting history in a negative way, which we did not bargain for. This is therefore a clarion call to the Buhari administration and his media watchdogs that they have a major work in their hands of fixing the economy – the very reason Nigerians gave him our mandate at the polls. We do not want the economy worsening any further than this.
We can afford to do without the submission of the likes of Dr Abari. We all know where we were before Buhari took over the reigns of power in 2015. There was positive economic growth during the Jonathan years compared to the recession and contraction of the economy in Buhari’s era. The rate of inflation, GDP growth, exchange rate, unemployment rate, etc, were better then than now. The costs of commodities have soared to an unbearable level for the common man, and a bag of rice now sells around N24,000 instead of the N7,000 obtainable during the Jonathan era. The stark reality staring us all in the face is a sure indication that the economy is only running backwards.
Ola Sunday is a Public Commentator