SOME economists have said President Bola Tinubu-led administration lacked a clear-cut economic policy direction, consequently increasing Nigerians’ suffering.
Nigerians are battling double-digit inflation at 24.08 per cent, a situation that has seen lending to the manufacturing sector becomes problematic and prices of food and other household commodities overshoot the rooftops.
The experts who spoke with The ICIR argued that the government must get a policy plan to improve the economy and relieve Nigerians from economic-induced pains.
Tinubu’s government came with a ‘no more subsidy’ (unpegged the international price of crude from the local price of premium motor spirit) pronouncement at his inauguration on May 29, 2023, but has rescinded the decision afterwards, which increased economic uncertainties.
Petrol prices, following his inauguration speech, increased by over 200 per cent, while delays in palliatives disbursement and overstretched negotiations with the Nigeria Labour Congress (NLC) heightened Nigerians’ avoidable pains.
For an economist, Kalu Aja, Tinubu’s government has lost the economic momentum it has with key pronouncements on exchange rate floating and removal of fuel subsidy, with the rescinding of pronouncements.
“The government has also been struggling with its exchange rate policy despite floating it initially, as naira continues to sustain a downward trend against the dollar, amid dwindling revenue resources from oil and increasing oil theft.
“There was an initial momentum when the government came in with pronouncements on the removal of subsidy on the exchange rate and petrol subsidy. There were lots of recommendations, and the market reacted positively to that,” Kalu told our correspondent in an interview in Abuja.
He further argued that the government’s delay in palliative distribution after petrol subsidy removal caused many problems, as he also pointed out further loopholes in Nigeria’s exchange rate policy.
“The government slowed down on the palliative, and now the petrol subsidy is back. The exchange rate float didn’t work optimally because the government didn’t do a full float,” he said.
He stressed that the government’s unstable stance on the reforms had affected its plans. “Currently, the government seem ruthless, with no clear-cut direction, a situation that does not give investors confidence and stability to the economy.”
Another development economist, Celestine Okeke, shared similar concerns and noted that the government had been shy about getting a policy direction, but enjoys making pronouncements.
“The government is yet to come up with any major economic policy direction. It is not healthy for the economy, and that is why we may not see any concrete development in the near future.
As a result of the policy somersaults, the World Bank, in its report, has described Nigeria’s currency as one of the worst performers in Africa.
According to the Bank, the naira weakened by nearly 40 per cent against the US dollar since it was devalued in June.
“So far this year, the Nigerian naira and the Angolan kwanza are among the worst-performing currencies in the region: these currencies have posted a year-to-date depreciation of nearly 40 per cent.
“The weakening of the naira was triggered by the Central Bank’s decision to remove trading restrictions on the official market. For the kwanza, it was the decision of the Central Bank to stop defending the currency as a result of low oil prices and greater debt payments.”
Some media outlets have also come hard on the government’s losing momentum on its policies.
For instance, the Financial Times of London editorial, on October 5, 2023, wants the government to “spell out his policies to the sceptical public.
According to the editorial,” The President should refrain from announcing plans, including the restoration of democracy in Niger- without any idea of how to implement them.
“Only four months into his presidency, what started out with a bang risks becoming a whimper. Tinubu needs to regain the momentum,” the editorial said.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.