Will Injection of $2 Billion Improve Nigeria’s Economy?

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Recently, the federal government promised to inject a whopping sum of $2 billion to improve the nation’s economy. The money has been shared to states and LGAs so as to permeate the grassroots which are the end beneficiaries of this bailout. The Rivers State Government received the highest share of this money. Quite frankly, the nation’s economy has come under intense pressure of late, such that it was becoming comatose as a result of Niger Delta crises, fluctuating oil prices and endemic corruption in all sectors of the economy. In any case, it is a welcome developmental idea. Initially, Nigerians were skeptical about the proper disbursement and actualisation of the desired original idea. Nigerians may be right in their thinking, considering the fact that this is not the first time government has proposed and professed to have injected huge sums of money into the nation’s economy. In the second republic the Shagari administration introduced austerity measure to keep the economy going and virile while the Babangida regime came up with the infamous Structural Adjustment Programme (SAP) meant to pull out the economy from the woods. In all, staggering sums of money in hard currency was pumped into the economy.

Yet, Nigeria under the Babangida jackboot in an attempt to fix the economy went cap-in-hand to the International Monetary Fund (IMF) in 1986 and successfully negotiated a loan of $1.5 billion into the country, the way and manner that money was spent is now history. There is no doubt that the idea to plough back into the Nigeria’s economy such large sums of money is not only a welcome development but plausible more so, at this period of global financial meltdown which has taken its toll on most advanced and strong economies. Nigeria as a matter of fact cannot afford to sit by while other countries break some new grounds to insulate their economies from the ravaging effect of the meltdown.

Perhaps, the source of this funds which is the Excess Crude Account (ECA) will go a long w ay to remind our leaders at all tier of government that accountability, honesty, transparency and probity in the politico-administrative, social and economic sectors of any given nation are the necessary and basic compass to navigate the future to avoid some uncertainties that may lurk ahead as we mature into  nationhood.

In terms of mobilisation of enormous financial resources, Nigeria has always been a lucky nation. For instance, the proclamation of amnesty to ex-militants of the Niger Delta and the successful disarmament programme of these young men have translated into sharp rise in quantity of crude oil produced, bringing the price of crude oil in international market. Once more especially the Bonny light crude to all time high of about $73 per barrel. However, the problem with Nigeria has always been how to tap or convert opportunities to tangible and practical development in the provision of basic social amenities and infrastructure to boost the economy. The question most Nigerians are asking is: What impact will the pumping of $2 billion make in the economy? Will it achieve the desired result by boosting our economy in this era of global economic meltdown?

The Tide On Sunday went round town to talk to some Nigerians on this sensitive issue. Excerpts

My name is Comrade Joy Inimgba-Koko. I hail from Amadi-Ama in the Port Harcourt City Local Government Area of Rivers State. I am a retired senior staff of Total E&P Nigeria Ltd and a one time chairman of Nigeria Labour Congress, Rivers State branch now a business man. My view of federal government’s decision to inject a huge chunk of $2 billion into our economy is like a lifeline thrown or extended to a drowning man on the high sea to save him from dying. I will say with all gladness it is indeed a welcome idea especially at this period of global economic down turn. In this case, I am a pessimist because my problem with Nigerian leaders is squandermania and high level corrupt practices. 

In spite of the establishment of anti-graft agencies, the EFCC and ICPC those we put in various positions of trust are still manipulating their way to corruption. I am afraid if this federal government financial lifeline will achieve its desired result. In any case, if the $2 billion must guarantee the purpose for which it was pumped into the economy the federal government should set up a tripartite committee to compel the 36 states comprising the officials of Ministry of Labour and Productivity, Nigeria Labour Congress (NLC) and Manufacturers Association of Nigeria (MAN) to oversee the disbursement and supervision of the use of this money in the rural areas where about 90% of Nigerians reside. We are all witnesses to the fact that the so-call poverty alleviation programme of both states and federal government has failed in ameliorating the poverty level of our rural dwellers particularly the peasant farmers.

I can tell you the standard of living of average Nigerians has come so low than it has even been before in the socio-economic history of this country. The poverty alleviation programme involving huge sums of money in hard currency instead of reducing poverty level impoverished majority of Nigerians because politicians hijacked the programme and distributed the money to their key allies and cronies, which gave rise to higher inflationary situations, high digital unemployment, the lowest income per capita and Gross Domestic Product (GDP) in the West African sub-region. However, I will advise that to achieve this noble aim of moving the economy out of the woods government should first and foremost tackle the problem of epileptic power supply, empower the peasant farmers with improved seedlings, modern farming methods  and equipment, establishment of agro-based cottage industries in the rural areas and encouragement of our local technology as well as its improvement to meet international standard.

I am Engr. Olumuyiwa Agbana from Osun State of Nigeria. I am the Chairman/Chief Executive of Wield Head (Nig) Ltd, an oil servicing company and Washwell (Nig) Ltd, a major industrial and household laundering company all located at Federal Housing Estate, Trans-Amadi, Port Harcourt. If I should speak on the effort by the federal government to improve the nation’s economy by $2 billion. My opinion will be that the federal government thinking to bail the economy may be right, but the approach is wrong. I feel that government ought to identify key sectors where this money will be channeled to. For instance, the educational, agricultural and power sectors are the major areas government should be looking at if the economy must be put on track and made to perform. If I may ask how much has the federal government invested in the education sector since its inception not to talk of agriculture? In the power sector every Nigerian knows that it has served as a conduit pipe for capital flight by our political leaders into foreign banks as evidenced by the last power probe in the country.

However, to ensure the buoyancy of our economy government has to make education functional at all levels and redesign the curricular to meet the challenges of the present realities. I am also suggesting and appealing to government to invest in agriculture and adequate power supply to encourage foreign investors to tap from the abundant human and material resources to reduce rural urban migration to boost food production and create employment for our army of unemployed graduates roaming the labour market.

My name is Dr. Godpower M. Wakama. I hail from Wakama Ama in Ogu/Bolo Local Government Area of Rivers State. I am a Civil Engr. Cum Development Economist and Chairman/Managing Director of Trojans (Nig) Ltd. Let me commend the federal government decision to sink the sum of $2 billion into the nation’s economy. It is indeed a welcome relief especially at this time when the economy has suffered dare stress from global economic and Niger Delta crisis. In addition, I will suggest that for the federal government to achieve its laudable goal of saving the economy from imminent collapse it should identify key productive sectors in the economy to invest this money so as not to create additional economic problems instead of solving the one already on the ground. The federal government should also identify verifiable small and medium scale entrepreneurs. This will avert the rush by many corrupt Nigerians to hijack the loans for the purpose of enriching themselves I believe that if government fails to use this money to serve these vital areas of our economy, this will create hyper inflation, a situation where there will be too much money in circulation in the hands of Nigerians chasing few goods and services which will cause more problems for us and more than any other thing cause great dislocation to the economy. However, to be on a safer side government should boost agricultural production which will lead to the establishment of small scale industries for employment generation among the people.

I am Mr. Luke Aham. I hail from Imo State but a Port Harcourt-based businessman. I am the Chairman/Chief Executive Officer of Hamcol (Nig) Ltd. I welcome the federal government plan to inject $2 billion into the economy. On that note, my opinion on the way forward for our economic growth is government should use this money to provide infrastructure and electricity supply which will enable the local industries to survive and attract investors to establish new ones. May I also say that the federal government should also tackle the Niger Delta question by building roads, bridges, schools, hospitals, agriculture and relevant support cottage industries, if not no matter the amount of money injected into the economy it will fail to make the desired impact. Again, it is my honest opinion that $2 billion if well managed can change the economic lives of Nigerians afterall, Ghana is what it is today by the IMF loan of $1.5 billion in 1986 because of the management style. It is my believe that there is still hope at the end of the tunnel if only Nigerians will shun corruption and inculcate financial discipline in resource management.

 

Okwein Parker