By Francis Akinnodi
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Analysts have called on the fiscal, monetary policy authorities of the incoming government to calibrate reform policies that would ensure FX liquidity conditions to remain frail in the absence of reforms to attract US dollar inflows into the economy.
They also implored the fiscal and monetary authorities in the country to show more concern to suboptimal exchange rate management, monetization of fiscal deficits, import and foreign exchange restrictions, adding that low FX liquidity conditions would also be driven by lingering global uncertainties and higher global interest rates, limiting foreign inflows to the economy.
Their advice was sequel to the uncertain outlook and persistent current account deficit in Nigeria, as a consequence, foreign investors would need some convincing actions as regards flexibility and clarity in the FX framework going forward.
They argued that the persistently high commodity prices would continue to be held back by structural problems—including electricity shortages, transport and logistic inefficiencies, as well as labour and product market rigidities.
They told The Hope that the Federal Government should prioritise greater investment in physical capital, education, and social safety nets, as well as more support for retraining and re-allocating workers to new and better jobs that will lead to the transformation of the economy to make it smarter, greener, and more resilient and inclusive.
World Economic Forum (WEF), in its recent Chief Economist Outlook, said the localisation and diversification of supply chains is expected to create a new geography of growth, new jobs and opportunities for small- and medium-sized enterprises and new entrants.
However, the global movement of people and exchange of goods, services, technology and ideas remains fundamental to growth and prosperity for developing economies, addressing inequality, expanding living standards for all and addressing the climate crisis.
“Poverty anywhere is a threat to prosperity everywhere,” Director-General, International Labour Organisation, Gilbert Houngbo said
According to economist, Dr. Timothy Awe, “My hope is that we can find big opportunities from the exploration of alternative drivers of growth, such as intra regionalisation, that have been untapped. This is how we keep global growth going,”
