Tax Increase Likely To ‘Strangle Businesses’, Says Mailafia


A former Deputy Governor of the Central Bank of Nigeria (CBN), Obadiah Mailafia, says the Finance Bill (2019) recently signed into law by President Muhammadu Buhari is likely to strangle businesses.

Mailafia who was a guest on Channels Television’s Sunrise Daily on Tuesday said as the nation’s economy gradually recovers, the new Act has the potential to kill businesses that are trying to survive.

“At a time of very slow recovery, it is risky to actually increase taxes. You are likely going to strangle businesses that are just struggling to survive,” he stated.

READ ALSO: Buhari Signs Finance Bill Into Law

Rather than increase in taxes, the economist advised the President Muhammadu Buhari administration to “relax some of the taxes, provide incentives and widen the tax base by bringing people who are outside the tax base.”

A former Deputy Governor of the Central Bank of Nigeria (CBN), Obadiah Mailafia, speaks on the President’s assent to the nation’s Finance Bill (2019) into law.

Speaking further, he stated that if taxes are increased, it would dampen the country’s economic growth.

He however commended President Buhari for his assent, noting that the move is a welcome development that it is good for the country.

“It is very welcome in principle because normally when you pass a budget, there should be a package of fiscal measures that should accompany such a budget.

“That is the standard practice. In fact, it used to be the standard practice in Nigeria until during the fourth Republic we forgot about it. So I think it is welcome, it is very good,” he stated.

There’s A Lot Of Suffering In The Land – Obadiah

A former Deputy Governor of the Central Bank of Nigeria (CBN), Mr Obadiah Mailafia, has lamented the poverty situation in the country, saying that there is a lot of suffering in the land.

Mailafia made this assertion on Monday during an interview on Channels Television’s Sunrise Daily.

“There is a lot of suffering in the land. There is no way we can gloss over it. We could but the reality is that life has become more difficult for people,” he stated.

Speaking on the nation’s economy, the ex-CBN deputy-governor stated that the economy is growly at a slow pace.

He lamented that economic growth does not tally with the population growth, describing the situation as negative.

A former Deputy Governor of the Central Bank of Nigeria (CBN), Mr Obadiah Mailafia

On the closure of the borders, the economist praised the Federal Government for taking the bold step that would check smuggling and other criminal activities.

READ ALSO: FG Puts Debt Stock At $83bn, Says Nigeria Not In Trouble

He, however, said the continued closure has contributed to inflation, including the high prices of rice which is consumed by most Nigerians.

Mailafia also advised the Federal Government to address inflation by reducing the cost of borrowing in the coming year.

The economist who spoke on the global oil price at $57 per barrel noted that if the tensions between the United States and Iran increase, Nigeria could benefit from the increase in crude price.

“It is not good to wish anybody any evil. But if the situation worsens against Iran and it leads to a standoff with the United States, we could benefit indirectly by higher oil prices. So we will wait and see how these things will pan out,” he stated.

Food Import: There Has Been A Capture Of CBN Politically – Mailafia

Dr Obadiah Mailafia



The presidential directive to the Central Bank of Nigeria (CBN) on food importation has continued to spark mixed reactions across the country.

Among those who faulted the order recently is a former deputy governor of the apex bank and development economist, Dr Obadiah Mailafia.

The economist who appeared as a guest on Channels Television’s breakfast show, Sunrise Daily, believes the affairs of the CBN are being interfered with, rather than operating as an independent institution.

“There has been a capture of CBN politically; it has no autonomy anymore,” he said in an interview on Thursday.

Mailafia added, “It (CBN) has no independence anymore. It is just an appendage of some people who are using it for whatever purpose that they want.

“It’s like we’ve gone back to the military days where the military will literally bring trailers to the mint and order printing of fresh mints, load them into trailers and drive off with them.”

READ ALSO: Don’t Give A Cent To Anybody To Import Food Into The Country, Buhari Tells CBN

On Tuesday, President Muhammadu Buhari ordered the CBN to stop providing foreign exchange for importation of food into the country.

President Buhari                                                                                        CBN Governor, Godwin Emefiele


The President, who hosted the All Progressives Congress (APC) governors to Eid-el-Kabir lunch in Daura, had explained that the directive was important considering the “steady improvement” in agricultural production and attainment of “full food security” in Nigeria.

He stressed that the foreign reserve would be conserved and utilised strictly for diversification of the economy, and not for encouraging more dependence on foreign food import bills.

But the President’s directive to the apex bank had been criticised by economic experts and other Nigerians, including a former CBN deputy governor – Professor Kingsley Moghalu.

‘Thoughtless Thought’

On his part, Mailafia aligned himself with the position of the critics of the presidential directive, saying he was disappointed.

He described the order as ‘thoughtless’, saying certain procedure must be followed before making critical decisions relating to a nation’s economy.

The former CBN governor also insisted that the country has yet to attain the level of food sufficiency that could warrant such an order.

“We can never be more primitive in riding an economy. It is not only primitive, it is backward, completely backward thinking and we are not self-sufficient in food; that is very wrong,” he said.

Mailafia added, “I wish there was any thinking here; there’s been no thinking whatsoever.

“It’s thoughtless thought; you don’t run policy on a web, you run policy based on a technical and scientific understanding of the situation at hand and then, you put together a technical paper working out the various scenarios for every alternative cause of action.”

Economic Recession: Experts Seek Solution To Challenges

Nigeria-NairaEconomic experts are meeting at the National Institute for Policy and Strategic Studies, Kuru in Jos, north central Nigeria to discuss and proffer solutions to the economic recession with a view on the immediate, short and long time recipes.

The three-day think-tank conference is looking at recession to recovery and growth with discussions on policy options for the Nigerian economy with experts from the organised business and the academia as discussants.

Eminent economists, policy analysts, corporate leaders in the banking and financial sector, the academia, civil society as well as captains of industry and parliamentarians are brainstorming on the theme: ‘From Recession to Recovery and Growth: Policy Options for The Nigerian Economy’.

Setting the tone for discussants at the conference, Chairman, Senate Committee On Governmental Affairs and chairman of the occasion, Senator Tijani Kaura, challenged the gathering to come out with practicable solutions that will take the country out of the economic woods and proffer policies that will make the economy to be buoyant again.

A former deputy governor of the Central Bank, Dr Obadiah Mailafia; the Head of Economics Department at the University of Nigeria, Nsukka, Prof. Stella Madueme and the Executive Director of Capital Markets in the Nigerian Stock Exchange, Haruna Jalo-Waziri also gave recommendations on what should be done in revamping the economy.

The experts appealed to the federal government to harmonise and coordinate various agencies and suggestions being proffered in addressing the economic recession in the country including the outcome of the conference that is ongoing.

Recession: Forum Lists Changes Needed To Reflate Nigeria’s Economy

Pat-UtomiParticipants in a conference held in Abuja, Nigeria’s capital, have identified critical issues they said must be addressed for the nation to come out of current economic recession.

Lack of political will to develop the manufacturing sector of the economy is a major reason the nation is in recession, they said.

The former Coordinator of the National Poverty Eradication Programme (NAPEP), Mr Magnus Kpakol, was one of the participants in the conference that focused on ‘the Role of Monetary Policy in Job Creation’.

It was organised by the Economics and Business Strategies Limited in Abuja.

Lack Of Ability To Produce

According to Mr Kpakol, dearth of foreign exchange and high inflation rate in Nigeria is caused by the lack of ability to produce for export.

Nigeria’s currency, the Naira, has continued to decline against the dollar since the nation’s foreign exchange policies made it difficult for importers to have access to the dollar like they used to.

Most of the items in Nigeria are imported. Poor power supply and other factors had stifled manufacturing, with most companies having to generate their own power. The high cost of production has made locally manufactured goods expensive.

The conference had series of lectures targeted at driving the economy seen as the largest in Africa.

Other discussants, a professor of economics, Pat Utomi, and a former Deputy Governor of the Central Bank of Nigeria, Obadiah Mailafia, emphasised the need to improve involvement in agriculture and manufacturing in the nation that had depended largely on crude oil sales for revenue.

Agriculture was the mainstay of the nation’s economy before the discovery of crude oil.

Meanwhile, the keynote speaker, Anita Campion, stressed the need to have a policy that encourages production, processing and export of agricultural products.

The conference came at a time that unemployment is on the increase and the economy is in recession.

According to the National Bureau of Statistics, Nigeria’s unemployment rate rose from 12.1 per cent in the first quarter of 2016 to 13.3 per cent at the end of the second quarter.

Despite the situation, experts at the conference believe that right economic policies that encourage private investments could turn the situation around.