NOT a few Nigerians have ugly tales to tell about the economic recession that took over the country in the past months.
Signs of the economic woes started showing towards the tail end of the ex-President Goodluck Jonathan’s administration.
Prices of oil in the international market that used to sell above $100 per barrel started tumbling.
It got as low as $30 in the wake of President Muhammadu Buhari’s administration with great consequences for the Nigerian economy that was largely dependent on oil revenue.
It was also believed in some quarters that Nigeria has stayed long in the recession because the savings that should have been made from past high sales of oil per barrel were frittered away by past administrations.Many Nigerian economists saw the hard time coming long before Buhari’s tenure was inaugurated.
It got so bad under Buhari that more than 27 states of the Federation could no longer pay workers salaries and allowances in their states.
They had to run cap in hand to the Federal Government for bailouts in order to settle accumulating debts and meet other obligations in the states.
As if that was not enough, many Nigerians were further impoverished with the high inflation rate that resulted from the high exchange rate of the naira to a dollar and increase in pump price of fuel from N86 to N145 per litre in May.
While the economy and Nigerians were suffering from low prices of oil in the international market, weak purchasing power of the naira and the new pump price regime at the petrol stations, their situations were further worsen by commencement of bombing and destruction of oil pipelines and power installations in the Niger Delta early this year.
The destructions not only cut daily oil production by more than 50 percent, reduced oil revenue and pushed the country deeper into recession, they also made implementation of the N6.06 trillion 2016 Budget very difficult.
But President Buhari was confident that the N7.3 trillion 2017 Budget proposal he laid before the National Assembly last Wednesday will take Nigeria out of the recession.In his Eid-el-Maulud message to Nigerians last week Sunday, Buhari said: “As we look forward to 2017 with hope and huge expectations, let me assure you that with collective dedication and hard work, we will overcome the mountain of economic difficulties, and return our country to the path of prosperity.
“The 2017 Budget proposals which I will lay before the National Assembly on Wednesday, will contain measures that we are confident will get the nation out of its economic woods.”
The 2017 Budget proposal laid before the lawmakers was based on oil benchmark price of $42.5 per barrel against $38 in the 2016 Budget.
While daily oil production was still estimated at 2.2 million barrels like in the 2016 Budget, exchange rate in the 2017 Budget was fixed at N305 to one dollar against N195 to a dollar in 2016 Budget.
The 2017 Budget also increased revenue projection to N4.94 trillion from N3.86 trillion in 2016 Budget.
Despite being difficult to implement the 2016 Budget due to a number of factors, the 2017 Budget, which has expenditure estimate higher by N1.238 trillion, has more deficit than in the 2016 Budget.
While the 2016 Budget has N2.2 trillion deficit representing 2.14% of GDP and financed by borrowing, the deficit in the 2017 Budget proposal is N2.36 trillion representing 2.18% of GDP and to be financed by N2.32 borrowing.
With all these, it will not be out of place to say that the 2017 Budget proposal may face more challenges to implement than the 2016 Budget except if oil prices in the international market and daily production in Nigeria continue to rise.
But very optimistic, the President told the lawmakers: “This Budget, therefore, represents a major step in delivering on our desired goals through a strong partnership across the arms of government and between the public and private sectors to create inclusive growth.
“Implementation will move to centre-stage as we proceed with the process of re-balancing our economy, exiting recession and insulating it from future external and domestic shocks.” He added
While the National Assembly will settle down to consider the 2017 Budget proposal after the Christmas and New Year break, it is hoped that those factors that worked against proper implementation of 2016 Budget or made Nigerians not to feel the real impact of the 2016 Budget, will urgently be addressed in order to succeed in taking Nigeria out of recession in 2017.
Apart from continuation of the economy diversification efforts of the government in 2017, nothing should be allowed to work against the 2017 Budget including hostilities in the Niger Delta.
It is also hoped that the fortune of oil in the international market will really improve in 2017.
More kudos for Osinbajo
Vice President Yemi Osinbajo last Thursday received more kudos that came his way. The 73th session of the National Economic Council (NEC) meeting applauded him and gave him standing ovation.
The members were marveled by his style of leadership. As the Chairman of NEC, he was commended for the way the Buhari presidency have been working transparently with state governments in the management of the national economy.
He was specifically hailed for ensuring that NEC meeting held every month since beginning of the administration.
Governor Rochas Okorocha of Imo State had moved a motion for the standing ovation just before the Council meeting ended.
The motion was unanimously supported as all members of the Council stood up and applauded.
Speaking on what transpired at the closed-door meeting, Kaduna State Governor, Nasir el-Rufai said: “The level of transparency that has been demonstrated by the Federal Government and the Vice President as Chair of this Council has never been demonstrated in this villa.”
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