Nigeria’s Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, on Monday, said the country will exit recession by the first quarter of 2021.
Ahmed spoke about the current recession in the country at the ongoing 26th Nigerian Economic Summit organised by the Nigerian Economic Summit Group and the Federal Ministry of Finance, Budget, and National Planning.
Nigeria, on Saturday, entered its second recession in five years in the third quarter of this year as the Gross Domestic Product (GDP) fell for the second consecutive quarter.
According to figures released by the Nigeria Bureau of Statistics (NBS) cumulative Gross Domestic Product (GDP) for the first nine months of 2020, therefore, stood at -2.48 percent just as it recorded a -6.10 percent in the second quarter.
The finance minister said the COVID-19-induced recession followed the pattern across the world where many countries had entered an economic recession.
“Nigeria is not alone in this, but I will say that Nigeria has outperformed all of these economies in terms of the record of a negative growth,” Ahmed said.
Also at the Economic Summit, Vice President Yemi Osinbajo made the emphasis that the government is committed to working in synergy with the private sector to foster equitable growth and underpin national development.
The 26th Nigerian Economic Summit focuses on building partnership for resilience for Nigeria’s households, businesses, and the general economy.
Former vice-president Atiku Abubakar says Nigeria needs to stop borrowing to avert sliding into a further recession.
Atiku, on Sunday, in a series of posts on his official Twitter handle reacted to Nigeria’s economic slip into recession.
In his statement titled, ‘We Must Exit This Recession With Precision,’ Atiku said it is a very heavy heart that he received the news which confirms that for the second time in five years, Nigeria has entered into another recession.
He said the nation must stop borrowing for anything other than essential needs adding that, the more the country keeps borrowing, the more it stands the risk of defaulting.
“The more we borrow, the more we will need cash to make interest and principal payments, and the less cash we will have to make necessary investments in our economy and our people.
“If we keep borrowing, we stand the risk of defaulting, and that will make recession a child’s play because we will lose some of our sovereignty,” he said.
Atiku also called on President Muhammadu Buhari to heed to the patriotic counsel given by himself and other well-meaning Nigerians on cutting the cost of governance.
See his full statement below…
We Must Exit This Recession With Precision.
It is with a very heavy heart that I received the confirmation that for the second time in five years, #Nigeria has entered into another #recession.
Heaviness of heart, because this could have been avoided had this administration taken heed to the patriotic counsel given by myself and other well-meaning Nigerians on cutting the cost of governance, saving for a rainy day, and avoiding profligate borrowing.
Yes, the COVID19 pandemic has exacerbated an already bad situation; however, we could have avoided this fate by disciplined and prudent management of our economy.
Be that as it may, it serves no one’s purposes to quarrel after the fact. We must focus on solutions. Nigeria needs critical leadership to guide her back to the path of economic sustainability.
We cannot afford hand wringing and navel-gazing. We must act now, by taking necessary, and perhaps painful actions.
For a start, the proposed 2021 budget presented to the National Assembly on Tuesday, October 8, 2020, is no longer tenable.
Nigeria neither has the resources, or the need to implement such a luxury heavy budget. The nation is broke, but not broken. However, if we continue to spend lavishly, even when we do not earn commensurately, we would go from being a broke nation to being a broken nation.
As a matter of importance and urgency, every non-essential line item in the proposed 2021 budget must be expunged.
For the avoidance of doubt, this ought to include estacodes, non-emergency travel, feeding, welfare packages, overseas training, new vehicle purchases, office upgrades, non-salary allowances, etc.
Until our economic prospects improve, Nigeria ought to exclusively focus on making budgetary proposals for essential items, which include reasonable wages and salaries, infrastructural projects, and social services (citizenry’s health, and other human development investments).
Additionally, we have to stimulate the economy, by investing in human development and increasing the purchasing power of the most vulnerable of our population. Only a well-developed populace can generate enough economic activity for the nation to exit this recession.
We must invest in those most likely to be impacted by the effects of the recession, the poorest of the poor. As well as stimulating the economy, this also ensures that they do not slip further into extreme poverty.
For example, a stimulus package, in the form of monthly cash transfers of ₦5000 to be made to every bank account holder, verified by a Bank Verification Number, whose combined total deposit in the year 2019 was lower than the annual minimum wage.
For example, a stimulus package, in the form of monthly cash transfers of ₦5000 to be made to every bank account holder, verified by a Bank Verification Number, whose combined total deposit in the year 2019 was lower than the annual minimum wage.
Now, how will this be funded? By more profligate borrowing? No. I propose a luxury tax on goods and services that are exclusively accessible only to the super-wealthy. A tax on the ultra-wealthy to protect the extremely poor.
A practical approach to this is to place a 15% tax on all Business and First Class tickets sold to and from Nigeria, on all luxury car imports and sales, on all private jets imports and service charges, on all jewelry imports and sales, on all designer products imported, produced or sold in Nigeria, and on all other luxury goods either manufactured or imported into Nigeria, with the exception of goods made for export.
The proceeds of this tax should be exclusively dedicated to a Poverty Eradication Fund, which must be managed in the same manner as the Tertiary Education Trust Fund, or the Ecological Fund.
I further propose that a 1% poverty alleviation tax should be legislated by the National Assembly on the profits of every International Oil Company operating in Nigeria, and international airlines doing business in Nigeria, which should also go towards the proposed Poverty Eradication Fund.
It is inhumane for us as a nation to increase the cost of goods and services that affect the poor, while keeping the cost of luxuries fairly stable. We must flip this, and flip it immediately.
And above all, Nigeria must stop borrowing for anything other than essential needs. Again, for the avoidance of doubt, borrowing to pay salaries, or to engage in White Elephant projects, is not an essential need.
This is particularly important as we need cash at hand because the world and our economic and development partners are also focused on helping their home economies overcome the effects of COVID19. We must be our own saviors.
The more we borrow, the more we will need cash to make interest and principal payments, and the less cash we will have to make necessary investments in our economy and our people.
If we keep borrowing, we stand the risk of defaulting, and that will make a recession a child’s play because we will lose some of our sovereignty.
I urge the administration of President Muhammadu Buhari to swallow its pride, and accept its limitations, so that they can open their minds to ideas, without caring who the messenger is.
For as Deng Xiaoping said, “It doesn’t matter whether the cat is black or white, so long as it catches mice.”
President Muhammadu Buhari on Thursday said the country was primed for a second recession in four years although the government has put in place plans to ensure rapid recovery in 2021.
The President made the remarks during the presentation of the 2021 budget proposal to the National Assembly.
Like many other countries, the Nigerian economy has been hit hard by the coronavirus pandemic which drastically cut the demand for oil, the country’s top revenue earner.
Before the pandemic, the country was on a three-year trend of modest but positive GDP growth.
The government’s plans to revive the economy include a focus on skills development exemplified by the Special Public Works programme which aims to provide employment opportunities to 774,000 young people across the country.
What Buhari Said
“The 2021 Budget was prepared amidst a challenging global and domestic environment due to the persistent headwinds from the Coronavirus Pandemic. The resulting global economic recession, low oil prices and heightened global economic uncertainty have had important implications for our economy.
“The Nigerian economy is currently facing serious challenges, with the macroeconomic environment being significantly disrupted by the Coronavirus Pandemic. Real Gross Domestic Product (‘GDP’) growth declined by 6.1 percent in the second quarter of 2020. This ended the 3-year trend of positive, but modest, real GDP growth recorded since the second quarter of 2017. I am glad to note that, through our collective efforts, our economy performed relatively better than that of many other developed and emerging economies.
“GDP growth is projected to be negative in the third quarter of this year. As such, our economy may lapse into the second recession in four years, with significant adverse consequences. However, we are working assiduously to ensure a rapid recovery in 2021. We remain committed to implementing programmes to lift 100 million Nigerians out of poverty over the next 10 years.
“As skills’ deficits limit employment opportunities in the formal economy, various skills’ development programmes are being implemented simultaneously to address this problem frontally. For instance, the Government is implementing the Special Public Works programme to provide employment opportunities to 774,000 youths across the 774 local government areas of Nigeria. We have also recently introduced the N75 billion Nigeria Youth Investment Fund, of which N25 billion have been provided in 2021 Budget.
“We thank all Nigerians, for your perseverance and continued support during these difficult times. We remain unwavering in our commitment to actualize our vision of a bright future for everyone.”
“So, we have used this (N-power scheme) and drastically reduced youth unemployment but we have not gotten to our target because most African government, Nigeria inclusive, we have some bad effects of the recession that started since 2008.
“That recession may have cleared *sic* in Europe and other climes, but in Africa, the effect of the recession still abound.
“Nigeria is a country that is dependent on oil revenue. It is of late that the government of Muhammadu Buhari started a diversification programme by which we now have other things to export,” the Minister said.
Also at the event, the International Labour Organisation (ILO) and its social partners offered an insight into how African countries can reduce rising unemployment rate, especially among the youth population.
The director-general of the NECA, Timothy Olawale, warned that Africa could be sitting on a time bomb unless drastic measures were taken to address increased youth unemployment on the continent.
He believes that industries will thrive if the political space allows for job creation by putting in place policies that will be favourable for employers.
He further analysed that there will be less crime and social peace in Africa if there are more jobs as economic growth creates jobs.
According to the Blueprint for Jobs in Africa which was adopted by the social partners in December 2015 in Casablanca, 63 per cent of the African population is less than 25 years old.
The Blueprint further showed that every month, at least one million young people on the continent enter the job market. And out of about 73 million jobs created on the continent in the past few years, only about 16 million jobs were grabbed by the youth population of Africa which is put at over 200 million people.
At the summit, the ILO submitted that the number of productive jobs in Africa would have to increase by over 300 million or some 26 million per year, more than doubling the number of existing productive jobs to reach 579 million by 2030.
The Executive Director, Development Specs Academy, Mr Okey Ikechukwu has called for cautious optimism saying the Federal Government should not assume and start celebrating the exit from economic recession yet.
Ikechukwu speaking on Channels Television Breakfast programme Sunrise Daily, on Wednesday, said the new figures released by the National Bureau of Statistics (NBS) which showed that the Nigerian economy grew at 0.55 per cent in the second quarter of 2017 should not be celebrated yet until the impact is felt by Nigerians.
“What are the indices to warrant the submission made, you look at unemployment, GDP, manufacturing, retail trade, what is it we recorded in all of these? When you speak of growth, you move economic indices and relate them directly to impact on citizen welfare.
“So, this growth is excellent. On Television, in the newspaper, all the analysis, micro economic indices, wonderful! When growth is not related to impact on life, it is an issue.”
He stressed that the economic indices released may be incomprehensible to many Nigerians until the effect is seen in their daily lives.
“For (economic) experts, there is a lot to cheer, but Nigerians are not experts. This is good news, but let’s not delude ourselves. Let the government not start celebrating and assume that we are out of the woods.
“The very problems on the ground are even getting worse. Your income and my income is buying less in the market. The trader has less money to import with because of the value of the naira. Retail businesses have shrunk by more than 50%. The shops are opened but they employ less people.”
President Muhammadu has however, said in a tweet on Tuesday that he was pleased with the news of the nation’s emergence from recession but there is still a lot of work to be done.
I’m glad we’re starting to see the fruit of our work.But there’s still a lot to be done;we will not rest until all Nigerians feel the impact https://t.co/t8OvDH479z
Ikechukwu who is also a Development Consultant, responding to the tweet by President Buhari while speaking on the Channels Television programme said President Muhammadu’s response to the exit from recession is reassuring but people celebrating should note that the indices announced does not immediately translate to improving lives of Nigerians.
He said, “It’s reassuring. The President is addressing the people and he is acknowledging that there is more work to be done. My point is that, let those who are celebrating not assume that the announcement they have made is translating to the indices that are improving people’s lives.”
The Federal and State Governments have been urged to explore opportunities in tourism, as an investment option that would help boost Nigeria’s revenue generation in the face of the current economic recession.
The appeal was made at the 47th annual conference of the Nigerian Institute of Estate Surveyors and Valuers (NIESV), which held at the Imo International Convention Center in Owerri, the state capital.
Speaking on the theme: ‘Growing and Diversifying the National Economy: The Real Estate Imperative’, the National President of NIESV, Bolarinde Ajayi, stressed the need for government to look into tourism and real estate development.
The Imo State Governor, Rochas Okorocha, who was represented by the Secretary to the State Government, George Eche, commended the association for deeming it worthy to choose the state as the rallying point.
The Governor said his administration since its inception, has done well in contributing its quota to the growth of real estate and tourism, considering the numerous infrastructural development it has achieved.
“As I declare this event open by the privilege given to me by our Governor, Rochas Okorocha, we appreciate and commend the leadership of this great association for choosing Imo state for the first time after 47 years of this conference – this practically tells us your association loves Imo state and we welcome you on behalf of Imo people”.
He further stated that: “if there is any profession that should be thankful to any government for uplifting their values then the NIESV should be thankful to the Okorocha-led administration. This is such that since the advent of this administration, the spate of development in all nooks and crannies of the state has made estate surveyors and valuers busier than their counterparts in other states of the federation; our Ministry of Lands is also the busiest in the east of the Niger” he added.
Also speaking, the Chief of staff to the Imo state Governor, Uche Nwosu, stated that tourism is a catalyst to economic growth.
He maintained that the importance of the estate surveyors and real estate practitioners cannot be overemphasized in management of the tourism sector.
Nwosu further stated that many countries depend on tourism as a major means of economic prosperity and if Nigeria can invest in the tourism sector and seek partnership with the Nigeria institute of estate surveyors and valuers, it could help the economy.
“As we as a nation continue to lament about the fall in oil prices in the world market, do we ask ourselves what next? What if there is no oil? Do we have to fold our hands and see things go bad, as a state, do we have to keep waiting for federal allocation until we pay salaries and pensions? I think we need to go back to the drawing board and think about how we can recover and boost the economy through tourism.
“As professionals, NIESV is very key to this project and if every country or state can be well coordinated to harness the tourism potentials embedded in the land, and also partner with estate surveyors and valuers, we might have a way out” he said.
The four-Day conference came to an end with a dinner and presentation of awards.
True federalism and political system restructuring have been identified as the panacea to the current socio-economic challenges in Nigeria.
This admonition came from former Commonwealth Secretary-General, Emeka Anyaoku, at the SUN Newspaper Man of the Year Award 2017.
While it was a time to honour those who had been nominated by the organisers as having distinguished themselves in the area of responsibility in the year 2016, it was also an opportunity to reiterate the call for higher standards in governance in the country.
The 14th edition of the event which took place in Lagos, brought together serving ministers, governors, political leaders and some other dignitaries.
Rivers state Governor, Nyesom Wike, bagged the Governor of the Year award, while Ogun state Governor, Ibikunle Amosun, was awarded as the Man Of The Year.
The Kwara state government has called on youths to take advantage of all available windows for self-sustainability to empower themselves instead of engaging in endless search for white collar jobs.
Speaking through his Senior Special Assistant on Youth Empowerment, Alhaji Saka Babatunde, at a one-day sensitization workshop on empowerment held in Ilorin, the State Governor, Dr Abdulfatah Ahmed said: “his government believes that when youths are idle, they become susceptible to perpetuate crime and commit all sorts of atrocities”.
This, according to the governor, compelled the state government to intensify and widen the scope of its training programmes for its youths.
“Our intention is to empower youths to be self-reliant and enterprising”, the governor added.
He further explained that apart from several other programmes initiated for the youths, the Malete Youths Integrated Farm since its inception, had trained over 500 students who had in turn, contributed to manpower development in the state.
“We have acquired hectares of land for youths farming and also set aside substantial revolving loan scheme for the youths to access for various kind of farming ranging from poultry, fishing, animal husbandry among others”.
He also disclosed that the present administration had established the International Training and Entrepreneurship College (ITEC), Ajase-Ipo, to provide vocational training for the teeming youths, adding that “the state government just appointed a rector and other management staff of the institution to pave way for the commencement of academic activities in the college in the next few weeks”.
Rate Of Unemployment
Babatunde, who noted that there had been increase in the rate of unemployment across the federation, said youths should develop themselves in entrepreneurial skills that would make them employers of labour.
He opined that if youths can properly utilize all the avenues and opportunities open to them, achieving the united nation’s 2030 agenda for sustainable development would become achievable.
The governor also called on other youths who were still perpetuating crimes to desist from such and take advantage of the several training programmes and empowerment initiatives of his administration to be self-reliant.
Babatunde therefore, urged the general public not to shield criminally-minded youths who were fond of disrupting peaceful co-existence of Kwarans, saying that the government would not tolerate such and would decisively deal with such individuals.
He said the programme which was organized by the Kwara state government in collaboration with the Tony Elemelu Foundation, was aimed at empowering youths in terms of resources which he identified as the major problem in starting business.
Furthermore, he stressed the need for Nigerian higher institutions to tailor their curriculums in line with present reality.
The State Coordinator of Kwara Agro Mall and representative of Tony Elumelu Foundation, Mr Temitope Amoju, said one of the objectives of the programme was to sensitise youths on how to create their own businesses.
He advised the youth to stop blaming the present situation of the country on mismanagement of some past leaders, but rather make the best use of the present situation to empower themselves and boost the economy.
He noted that there was no aspect of life that could do without agriculture, saying Nigerian graduates must henceforth stop searching for formal jobs that seem to be no longer in existence.
Food Production Capacity
The Governor stressed the need for productivity, resilience and hard-work among Nigerians, pointing out that the present nation’s economy demands one to be self-employed.
According to him, there is no other alternative to sustain Nigeria’s economy than to build the required interest in agriculture and brace up with anything that could promote food production capacity.
Mr Aregbesola held that Nigerians must, as a matter of urgency, invest in things that would prevent famine in the next five years if truly the nation was ready to overcome her present economic challenges.
Lamenting the dwindling revenues from the crude oil sales, Governor Aregbesola said “unless Nigeria sees the need to promote agriculture, efforts to bring back the dwindling economy may be gloomy”.
“There is need for us, especially our young graduates, to lead the nation in promoting agriculture as the only realistic surviving alternative to economy.
“We must embrace farming because it is only agriculture that has direct links to all aspects of life.
“Nigeria has grown to the stage her food production capacity must be urgently expanded to meet the general needs of the citizenry and as well enhance exportation.
“The time to enhance productivity has come. We must all embrace productivity. We must produce whatever we desire to consume,” he stressed.
Congratulating the graduating students, Aregbesola charged them to adapt to the virtues they acquired in the institution.
He advised them to get prepared for the challenges ahead and life after university which he described as “challenging”.
“You must all be prepared. The challenges ahead, especially at this period of over saturated tendencies of labour market, you need grim determination to succeed. You must be rational and critical in the application of the knowledge you have acquired”.
He further appealed to those who are using the precious and reputable name of Islam to perpetrate violence, saying “violence is directly antithetical to Islam”.
“All hands must be on deck to end terrorism in the country as the act is tantamount to the tenets of Islam.”
Earlier in his lecture, Professor Abubakar Adamu Rasheed, charged both private and public organisations in Nigeria on the need to invest more in education.
He said the country had gone to a stage where education should be seen by all as a bedrock for national development and called for the need to encourage participation in both basic and higher education.
Professor Rasheed, who is the Executive Secretary, National University Commission, said all hands must be on deck to promote tertiary education.
He implored stakeholders in the private and public institutions in the country to, as a matter of necessity, rescue the nation from her present educational backwardness by establishing more universities in the nooks and crannies.
Prior to the discovery of crude oil, agriculture use to be Nigeria’s economy mainstay, a position the Nigerian government is pushing to return the nation to by pushing for more youth involvement in agriculture.
The National Chairman of United Progressives Party (UPP), Chekwas Okorie, says early passage of 2017 budget of N7.2 trillion by the National Assembly might end economic recession in Nigeria.
Okorie made the statement at an event in Owerri the Imo state capital south-east Nigeria.
He said if the budget is passed early and funds appropriated to various ministries, departments, and agency are promptly released, the economic challenges being faced by Nigerians in recent months could end.
Okorie, who was responding to questions from journalists said that he was optimistic the economy has a chance of survival in 2017. “The progress being recorded in food production like rice should be sustained” he said.
“In recent times, we have seen the synergy between the Kebbi State government and Lagos state in rice production, government should sustain its policy of diversification and equally support industrialization’’.
The UPP Chieftain also urged state governments to create enabling environments for SMEs to pave the way for youth employments.
He maintained that with such steps a lot could change in the socio-economic situation of the country in 2017.
Few hours ahead of Christmas day, Nigeria’s President, Mohammadu Buhari, has sent a yuletide message urging Nigerians to pray for divine guidance in the face of the country’s challenges.
In a statement released on Saturday, the President said:
“Dear Compatriots, I heartily rejoice with all Nigerians, particularly our Christian brothers and sisters, on this year’s celebration of the birth of Jesus Christ.
“As we celebrate this year’s Christmas, I believe that it is very appropriate for us to reflect on the love of God aptly espoused in the teachings and lifestyle of Jesus Christ.
“During his earthly sojourn, Jesus Christ repeatedly reminded his disciples and followers of peace that comes in the midst of trials and tribulations on earth.
“There is no better time than now in our nation’s history to pray for divine guidance to get over our current challenges.
“We can have peace in Nigeria if we all learn to tolerate and appreciate one another, respect constituted authority; and be our brothers’ keepers in word and deed.”
Furthermore, he stated that: “During this period, we should remember to offer special prayers to God for all our heroic citizens who paid the supreme price to restore peace and security in the northeast and other flash points in the country.
“Let us also remember in our prayers the security forces in the front-line in the continuing battle to rid our nation of terrorism and violence.
“We must not forget the Internally Displaced Persons (IDPs) in our midst and those who have suffered untold hardship as a result of activities of insurgents and terrorists.
“Our immediate priority is to alleviate the poverty of Nigerians by quickly stimulating the economy. I assure Nigerians that our government is doing its best to make life easier for all,” he said.
“Let us therefore, renew our hope in the God-ordained unity, progress and prosperity of our great nation.
“I wish all travellers safe movements and a memorable holiday as we celebrate with our family and friends, Merry Christmas!” the President prayed.