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Expert lists 8 minuses that frustrated 2016 economy, warns against repeat

Leading development economist, writer and public affairs pundit, Mr. Jide Ojo has listed six key negative factors that fought and clouded the Nigerian economy in 2016 and warned the federal government to learn from the mistakes of last.

In an interview, he listed oil crisis-induced economic challenges, wrong policy options and erratic changes, poor Ease of Doing Business’, forex differentials, the floating exchange rate, high interest rate on loans, availability and affordability of electricity, the soaring incidences of crimes and criminality.

He revealed that the above factors created rooms for the collapse of more businesses than budding and consolidation of news ones which would have created more jobs.

According to him, the slipping of Nigeria’s economy into recession, impacted negatively on the country’s business environment as most promising businesses shut down.

Besides, he disclosed that the economy witnessed more divestments than real investments which plunged the nation’s unemployment and poverty status to record highs.

In his submission, Ojo maintained that “The policy flip-flop on the exchange rate; lack of feasible and comprehensive economic blueprint; revenue shortfall to finance the 2016 budget; inability to meet Nigeria’s OPEC oil quota and 2.2mbpd estimated for the year due to incessant vandalism of oil and gas pipelines by Niger Delta militants and lack of strong economic team, all combined to impact negatively on Nigeria’s economy in the outgoing year”.

While arguing that some of these challenges are avoidable, Ojo stressed that “A new economic team should be made up of experts and economic blueprint are non-negotiable for a country in recession to exit”.

He recalled that “The 2016 budget was premised on zero-based budgeting, which is a novel budgeting process,” maintaining that “This is yet to be perfected, as this year’s budget was plagued by the issue of ‘padding’ both by the executive and legislative arms of government”.  “Again, the late passage of the budget, which came into operation in May 2016, has necessitated the extension of the lifespan of the implementation by the National Assembly to one calendar year and that means it will be operational till 2017 May.

“Perhaps, this encouraged the presidency to again submit the budget for the 2017 late (presented to NASS on December 14 while that of 2016 was presented on December 22, 2015.) This does not augur well for the country’s economy and is one of the lingering challenges the executive ought to have avoided. The president has said that 2017 budget will be zero-based like that of 2016. In these aforementioned respects, it can be safely said that there is continuum in the nation’s budget process.

He warned the federal government to consolidate its drive towards reduction in official wastages, saying “for 2017 budget to exit Nigeria from recession, the newly established ‘Efficiency Unit’ in the federal civil service must work hard to weed out wastages and seal leakages.

Ojo maintained that all these suggestions can only work well if many of the ministers that piloted strategic ministries in 2016 were weeded away to create room for real experts that know the jobs better.

He warned that “Any attempt to continue testing politicians will cost the party next election because if no tangible recovery signs are seen this year, the ruling party is as good as dead come 2019, the next election year both at states and federal levels”.