By Francis Akinnodi
Financial experts have posited that unless there is a fundamental shift from governance approach that focuses on bloated cabinet structure, wasteful expenditures, oil theft, corruption, and forex speculations, Nigeria’s economy would continue to be overheated with dire consequences on the naira.
The experts said this in interviews with The Hope recently.
A financial expert, Dr. Tunde Lemo said the sole reason why Nigeria’s economic adversities have continued unchecked for many years is because it lacked power to hold leaders accountable.
He said the economic downturn in the country grew this bad simply because government at all levels view the money accruing to them as “cheap money rather than tax payers’ money”.
He traced the trajectory of the Nigerian economy from 1960 to date and submitted that the oil boom in the 70s coupled with the expensive lifestyle of the privileged few, led the country on the downward spiral.
He said: “In 1960, we had an agrarian economy, South-West prided itself in cash crop majorly cocoa, and the North, groundnut mainly among so many others and, of course, the Middle Belt was the food basket and the East we had the palm oil, the rubber and so on and so forth.
“We struck oil in the mid-60s to late 70s to the point that we had this quotation that money was not the problem but how to spend it.
“That is where we got it wrong. Because we had a cheap dollar. Our currency was heavily over-valued in real and effective terms.
“We had students in the universities who will collect their bursary and during the long holiday, they jet out to Rome, London, Milan and everywhere. Life then was easy. The petrol dollar that we were earning was subsidising expensive lifestyle of the few. Even the government began to earn income they didn’t work for. The bulk of the money which the different arms of government were spending was not tax money. Even the electorate didn’t hold them accountable because it was free money and so corruption was the order of the day.
“Overtime we began to expand government expenditure from three regions to four, 19, 22 and finally to 36 states.”
Dr. Lemo also identified other factors that contributed to the current state of the Nigerian economy, including over-reliance on petrol as a means of dollar revenue, capital flight, food importation, medical tourism and corruption.
An economist, Prof. Timothy Awe however called on government to ensure that the cost of living is reduced particularly for those at the lower rung of the ladder and to also speed up on the mass transit for workers.
He further advised the government to sell off the nation’s refineries to the private sector to manage profitably.
“These assets are old. They are no longer as productive as they should be and they can’t be operated by the government for profit. Otherwise, we would still be borrowing money to pay for work not done. Let’s sell those refineries.”