National Economic Retreat: Buhari’s Framework For Recovery By Ugo Jim-Nwoko
Before the 2015 general election, the state of our national economy had already shown great symptoms of weakness and imminent collapse; but for the coming of the All Progressives Congress federal government. There is no doubt that the Nigerian economy is going through tough times even under the President Buhari’s nearly one year administration. The reasons for this depressed and repressed economy are the wasteful and rascally use of public resources; lack of prudent management and the inability of our successive leaders and rulers to save some of our hard earned resources for the rainy day. We had lived for the major part of our national economic life over the years as if there would be no tomorrow. Now, the tomorrow is here and we have been caught economically napping due to our long period of national prodigal lifestyle based on economic rudderlessness.
Most people in Nigeria today are lacking resources for their basic needs, the unemployment rates have skyrocketed and Nigeria is not doing well almost in all economic fundamentals. The exchange rate is high, interest rate is harsh, our foreign reserves are not comfortable, and the security situation of our country does not promote foreign direct investments amidst infrastructural deficit. The social sectors cannot support development because the educational systems do no longer build competent and qualified manpower for the economy; the health sector lacks the capacity to deliver quality health-care; water and sanitation situation in the country is promoting the growth of urban and rural slums in the face of food insecurity. Therefore, greater mass poverty is looming if drastic economic measures are not taken.
The urgency and capacity needed to take drastic economic measures to rescue our economy is what makes the Buhari Presidency and administration an imperative. On the spot of his inauguration, he brought a new and rewarding strategy for tackling BOKO HARAM insurgency by the relocation of the command headquarters and structure of the military to the seat of BOKO HARAM in Maiduguri. The probe of the military procurement relevant to the fight against terrorism has unearthed mind–boggling corruption beyond the imagination of the Nigerian people and world community. Buhari’s will to implementing the Treasury Single Account (TSA) is a fiscal policy tool that have boosted public revenue and checked corruption.
The convening of the National Economic Council Retreat by the President Buhari administration is a step further in the administration’s continued effort towards redirecting our national economy. The theme of the retreat which considered the Nigerian States as multiple centres of prosperity is very apt to the urgent need to convert the thirty–six State capitals as not only centres of political brigandage and demagogy to hubs of economic revival and development. Over the years, our structure of federalism does not promote independent economic actions and creativity because of the availability of oil revenue for sharing. This has limited original economic thinking on the part of most of the thirty –six states in the country. It is high time these states re-engineered economically from centres of consumption to centres of economic prosperity. This government is working in that direction.
It is noteworthy that agreements were reached at the event coordinated by the Office of the Vice-President and Presided over by Vice-President Yemi Osibanjo with most Governors and Deputy Governors in attendance; for concerted and consistent efforts to diversify revenue sources; expand compliance on VAT, adopting a gradual plan for rate increase; increase expenditure through borrowing, which should be invested in infrastructure.
It was also agreed upon that Federal and State Governments should focus on fiscal responsibility as a critical element in macro-economic balance; increase investment in infrastructure through public private partnership (PPP); develop financial inclusion strategies to cater for the poor and vulnerable population; and maintain a minimum level of capital expenditure of 30% in the budget.
In the agricultural sector, government has decided to re-position Bank of Agriculture to enhance its capacity to finance agriculture. National targets for self-sufficiency have been set for identified crops, which should be monitored. Tomato paste – 2016, Rice – 2018, Wheat – 2019.
In the area of solid minerals; the Ministry of Solid Minerals Development is to complete and present the solid minerals development roadmap. This framework is meant to address issues of illegal mining, licenses, taxes and royalties by 31st March 2016. The ministry is also to agree with states and local government on respective responsibilities for developing feeder roads and other critical infrastructure for solid minerals development and to set deadlines to achieve self-sufficiency in Bitumen/Asphalt and tiles (to discourage/stop importation)
In Trade and Investment sector, States are to collaborate more actively on regional basis on investments and industrialization. The Federal Government will work with the States and other stakeholders to create an enabling environment for trade and investment through the implementation of the Nigerian Industrial Revolution Plan (NIRP) to encourage industrialization; make environment conducive for the Micro, Small & Medium Enterprises to create jobs for the unemployed and undertake deliberate policies to create access to funds. While States and Federal Governments must emphasize the patronage of “Made in Nigeria” products. “Import competition” rather than “import substitution” should be emphasized.
At the NEC Retreat, there was an agreement on the urgent need to develop and invest in our people. Federal and State Governments are now to work collaboratively to ensure sustainability of the school feeding and other social protection programmes; and to ensure co-operation from the States’ Ministries of Education and State Universal Basic Education Board (SUBEBs) for the Teacher Corp Program. Federal government will provide logistics support on the proposed upgrade of 75 existing National Directorate of Employment (NDE) facilities (across the various States) to Empowerment Centers Cooperation and coordination with the States on their specific job creation efforts. State Governments are to support artisan training, scoping and support for existing artisan cultures and use of existing training facilities. It became imperative to Institutionalize a single register as a platform for targeting the authentic poorest and vulnerable for safety net programs; for government, donor agency, organizations or individuals.
The Buhari administration is fully aware of the challenges of insecurity, infrastructural renewal, economic development and job creation facing his government. There is also ample evidence to support government’s appreciation that without enough resources very little of his good intentions will be implemented. This certainly, confirms the emphasis on revenue generation which took a critical position at the National Economic Council Retreat.
The council agreed to make deliberate effort to generate relevant data on the respective economies of the states and the nation generally in order to drive revenue generation. Federal Inland Revenue Service and States Inland Revenue Services need to invest in relevant technology to support efforts to improve tax collection. There is a need to develop incentive schemes for federal and state revenue generating agencies ; FIRS and SIRS need to actively collaborate on initiatives to improve tax collection, including joint audits of major corporate tax payers; all state governments are encouraged to establish efficiency units to review/enhance the quality of expenditure as well as plug revenue leakages ;focus on property and consumption taxes will help in improving revenues in a fair manner and to promote tax-payer education to expand the tax base and avoid political back-lash from intensifying tax collection.
The All Progressives Congress’s (APC) Federal government of Nigeria and the CHANGE Agenda was accepted by the Nigerian people through the ballot in 2015 because of the promise to fight corruption, end the BOKO HARAM insurgency and chart the course of economic revival to ensure employment generation and reduce poverty. These are difficult tasks that cannot be tackled successfully within the context of falling national revenue on a short term.
The administration therefore is laying foundation for economic revival and national re-orientation on a long term sustainable basis, which had been lacking before.
It calls for the support of all and sundry for the purposes of better life for our people irrespective of political party, ethnic and religious affiliations. As the former Minister of Finance and the Coordinating Minister for the Economy, Ngozi Okonjo-Iweala used to say: we may have 36 states plus the Federal Capital Territory and 774 local government areas; but we have and will have only one economy. So, as one people, there is need to support the economic recovery effort of our nation to put our people back to work and on the part of economic prosperity once again.
Ugo Jim-Nwoko is a development and budget policy analyst and writes from 342 Segun oluwa Street Utako Abuja.