Economic Recession: Why Nigerians Must Know What Went Wrong – Presidency

Filed in News by on September 3, 2016

Nigerians reserve the right to keep talking and asking questions about how the economy got stuck, the Senior Special Assistant to the President on Media, Malam Garba Shehu has said.

Shehu, in a reaction to the “cacophony of voices telling the Muhammadu Buhari administration to close its eyes to the past,” observed that citizens “must keep a fiery memory of the past so that we don’t repeat its mistakes.”

He said: “To avoid repeating the past mistakes, Nigerians must come to terms with what went wrong with the past, how bad were things, what was done wrongly, and what the past government should have done, before we come to what needs to be done to right those wrongs.

“Believe me, episodes from the Jonathan era can fill books, and other possibilities such as courtroom drama thriller.”

He said that the economic pain which the generality of Nigerians currently experience is inevitable given “the mismanagement of the past.”

“This government is simply being honest with the people instead of piling up debts and concealing the truth by pretending all was rosy. This government believes that Nigerians deserve to know the truth,” he said.

“People stole unbelievable amounts of money. The kind of money some of these ex-officials hold is itself a threat to the security of the state. Since it is not money earned, they feel no pain deploying it just anyhow to thwart genuine and well-intentioned government efforts.

“Sadly, even that which was not stolen was wasted. Government coffers were left empty, with huge debts unpaid and unrecorded (this government is working to quantify the amount owed). Even the current high food prices can be traced to past deceit.

“For example, the previous government purchased fertiliser in 2014 worth N65 billion and left the bill unpaid. In 2015, the suppliers could not supply fertilizer, which resulted in a low harvest, shortages and high food prices. This government had to pay off the debt so that the suppliers could begin to supply fertiliser again.

“Across Nigeria, a green revolution is occurring as Nigerians are going back to the farms, from rice in Kebbi and Ebonyi to Soya and Sesame in Jigawa and Kano. At the same time, Nigerians are looking inwards to identify commercial opportunities from agri-businesses.

“Most of our road contractors had not been paid since 2012; many of them had sent their workers away, adding to the unemployment problem. This government has released capital allocations in the last three months that is more than the whole of 2015.

“In 2015, Nigeria spent a paltry N19 billion on roads. In three months, we have spent N74 billion and we are already releasing more.”

He argued that Nigeria would have been worse than it is now had the PDP returned to power in 2015. “If PDP were still in power they would have continued deceiving people, by borrowing to fund stealing and wastage, and the problem would have simply been postponed for future generations to face.

“In addition to failing to spend money on what was needed, no savings were made by the government unlike other countries like Qatar, Saudi Arabia and Norway.

“To compound the problem, the previous government was borrowing heavily and owed contractors and international oil companies. When this government took over, we had accumulated debt back to the level it was at before the Paris Club Debt Forgiveness.

“All these factors were building up to Nigeria heading for a major crisis if the price of oil fell. Nigeria did not have fiscal buffers to withstand an oil shock.

“The oil shock should and could have been foreseen. These are matters that both the Emir of Kano, Muhammadu Sanusi II and Professor Chukwuma Soludo, both of them eminent former Central Bank Governors, had occasions to warn the government of the day about, but they were clobbered. The dire warning was written all over the wall, but they were ignored by Nigeria’s economic managers.”

He said the Buhari administration is currently reinventing the country by re-orientating the relevant agencies to:

Focus government spending on infrastructure which will create jobs and opportunities for Nigerians across a number of sectors (not just oil).
Ensure that we reduce our reliance on oil by developing other revenue streams such as taxes, efficient customs collections and other government revenues.
Develop key sectors in which we have comparative advantage.
Encourage development of agriculture to ensure food security for our huge population.
Develop petro-chemical industry on the back of the oil industry.
Develop solid mineral extraction and
Develop light manufacturing to provide locally made basic needs and reduce importation.

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