Economist Proffers Solutions to Quicken Exit from Recession

Economist/Chairman, Adel & Argus Global Services Limited, Anthony Aziegbemi has urged the federal government to lead by example by patronising Made-in-Nigeria products as a way stimulating the economy and aiding a quick exit out of the current recession.

He said a larger chunk of government’s spending ought to be within the country, adding this was needed at this challenging period.

He lamented that there had been no significant stimulus package by government to address the present situation compared to other countries including China, which had increased spending in strategic investments in rural infrastructure health and education among others.

He said though the several interventions of the Central Bank of Nigeria (CBN) in various sectors were commendable, they are not enough to liberate the country from its current predicament.

He said global economies have used fiscal policy to stimulate demand in the face of collapsing global demand-an essential ingredient still lacking in the Nigerian circumstance.

Specifically, he said the current CBN interventions in the foreign exchange market, which appeared to be yielding positive results, were merely artificial and won’t bring a lasting solution to the problem.

He said the real value of the local currency should be left to the forces of demand and supply.

Among other things, he said government must show commitment in its diversification efforts.

Speaking in Abuja while leading discussion on “Rethinking the Current Recession: The Way Out” which was put together by ValueFronteira Limited, he said some of government’s economic policies needed to be driven by passion to enhance the buy-in of all Nigerians.

He further questioned the decision of monetary authorities to raise the monetary policy rate at a period of recession, stressing that it is worrisome for people to refuse to spend because of uncertainty.

Aziegbemi said transparency was the key in the various interventions by the apex bank, adding that beneficiaries of such interventions should be publicised for probity and accountability as well as a way to plug leakages.

According to him, hastening exit from the current recession would require that investors be quickly attracted back into the economy while government redeems its outstanding contractual obligation to contractors.

He further advised that attention must be paid to agriculture and agribusiness while also encouraging export of manufactured products.

He also called for better management of the fight against corruption, tax rate reduction and tax base expansion, enhancement of sources of foreign exchange as well as the localisation of refining of petroleum products.

He also called for proper coordination between monetary and fiscal policy.

He gave support to current campaign to give amnesty to treasury looters as the country needed such monies to spend its way out the recession.

He said: “This recession is quite temporary. But the lessons that come with it will remain huge. Unless we pay attention to the underlying entrenched and short term causes of the recession, we shall expect yet another one soon.

“It might also be a depression. We still have a golden opportunity now that the prices of oil appear to have slightly improved. The opportunity for diversification is huge. The opportunity to leverage the numerous natural endowments of minerals, forestry, livestock’s, agriculture to finance and develop other industries as well as the technology required to join the rest of the developed world is also huge.”