How to make economic recovery plan work, by experts

For Nigeria to achieve the strategic objectives outlined in the Economic Recovery and Growth Plan (ERGP), there is need for consistency in its implementation, experts have said.

The experts, among them, Prof. Olu Ajakaiye and the Rwandan High Commissioner, Stanislas Kamanzi, spoke at the second edition of the Bullion Lecture organised by Centre for Financial Journalism in Lagos. They said the Federal Government must be consistent in implementing the policy.

Noting that the ERGP could propel the country’s economic growth and development, they, urged the government to be committed, creative and determined to see it through.

Ajakaiye, Chairman of African Centre for Shared Development Capacity Building (ACSDCB) in Ibadan, the Oyo State capital,   said past efforts to turn around the nation’s economic fortunes failed primarily because of  inconsistent implementation.

In his lecture titled: “Nigeria’s economic recovery and growth plan: options for low cost financing of the programmes”, Ajakaiye expressed optimism that the recently-launched ERGP would not go the way of others before it.

According to him, there are indications that the ERGP-2017-2020 will be accompanied by a Federal Government’s investment programmes, raising the prospects of a strong plan-budget link, a pre-requisite for an orderly effective and efficient plan implementation.

He also expressed hope that state governments as well as private sector operators would be guided by the Federal Government’s Investment Programme (FGIP) in their investment plans.

Ajakaiye, who also serves on the Federal Government’s Economic Advisory Group, said it was important for the government to be mindful of the dangers of another round of external debt overhang.

He, spelt out options for low-cost financing of the programmes articulated in the plan. For instance, he stressed the need to broaden the tax base and improve the nation’s tax administration capacity and processes.

According to him, this was to mobilise additional non-oil revenue to support the various programmes and activities aimed at structural transformation of the economy envisaged in the ERGP.

Ajakaiye also suggested that Federal Government should consider using the stock market to privatise commercially viable national assets. “The government should list all of its commercial enterprises on the stock exchange (SE). This way, the government portfolio can be divested to the general public, including foreign investors and avoid the controversial and sometimes questionable privatisation arrangements,” he said.

The ACSDCB chairman said in this case, the government divestment could be instrumental in mobilising financial resources to support worthy development activities, including infrastructure projects.

“Clearly, the major attraction for Nigeria is the oil industry, making it imperative to ensure peace and stability in Niger Delta region if the projected annual foreign direct investment flow of around N970 billion is to be realised,” he further said.

Ajakaiye regretted that Nigeria was experiencing stagflation, which, according to him, is marked by high inflation, low employment and negative growth. These, he pointed out, made it necessary for the government to pursue low cost measures to financing the multi-trillion naira investments envisaged in the ERGP.

For the Chief Consultant, B. Adedipe Associates, Dr. Biodu Adedipe, there is need to deploy the over N7 trillion Pension Fund to finance the growth of the economy. He also noted that Pension Fund Administrators (PFA) can be encouraged to invest in bonds.

The expert argued that the nation’s economic recovery would depend on the government’s commitment, creativity and determination to see through her well-thought out ideas and bring them into fruition. He advised on the need for the country to stand its ground on its convictions and economic models to stimulate the economy.

Adedipe, for instance, recalled how the World Bank campaigned against the development of the steel sector in South Korea, but because of the country’s resolve, it now boasts cars that are sold all over the world.

Citing instances with other countries that rejected some so-called expert advice by some global financial institutions and overseas countries, Adedipe advised government to pursue the policy without recourse to what anybody outside the country says.

He regretted, for instance, that while South Korea took Nigeria’s model from Ajaokuta steel rolling mill and made something out of it, Nigeria sold hers as scrap, helping foreigners to engage in asset stripping. “No economy can grow with the way we do things,” he said.

The expert, therefore, advised the Federal Government and policy makers to take time to study the country’s peculiar situation to determine what is good for her and insist on that path of growth rather than being dictated to by development partners and other countries.

Kamanzi said micro finance was a  tool for poverty alleviation and wealth creation.

The envoy said micro finance was essential to people-centred development, as it is an important stimulant of the creation of a middle income class that is critical for African economies to substantially take off.

Ambassador Kamanzi, who was special guest at the lecture, added that it was important for lay people to understand the tenets and mechanisms of micro finance. He, therefore, challenged financial journalists to play a key role in this connection and to build on synergies with the operators in micro finance.

He said in the past decade, Rwanda has been able to move more than a million people above the poverty line through a combination of strategic investment meant to uplift livelihoods of identified poor communities and tapping their own capacity to solve their problem, with a minimal push from Government.

Former Acting Managing Director of Niger Delta Development Commission (NDDC), Mrs Ibim Semenitari, urged the government to be consistent in the implementation of its programmes.

Mrs Semenitari challenged players in the private sector to show interest by identifying with government programmes and the need for them to see themselves as partners in progress with the government.

Listing some factors that could aid the realisation of teh government’s programmes, Mrs Semenitari said: “There must be transparency on the part of government and all its agencies; the elite must show interest to the point of insisting that the right things must be done.

“There must be a justice sector that guarantees transparency and fairness; there must be strong institutions that guarantee the actualisation of the plans, and matter of security is something we cannot wish away.”

 

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