By Uche Usim
As the recently inaugurated Presidential Economic Coordination Council (PECC) gets down to business, experts have asked the Federal Government to buoy them with strong policies, regulatory support and more presidential orders.
The team is being welcomed by headline inflation currently at 33.69 per cent, sovereign debt of over N121 trillion, debt-to-GDP ratio at 51 per cent (narrowing the borrowing space), scarce and expensive foreign exchange, blooming insecurity which has led to plummeting food production and a generally fractured economy.
Other areas needing their attention are rising unemployment, poverty, exodus of frustrated multi-nationals and the growing demise of local manufacturers.
The PECC consists of 31 members made up of government officials, legislators and corporate czars pooled from diverse sectors of the Nigerian economy. The aim is to inject N2 trillion into the economy within the next six months to ensure it is appreciably stabilised and planted on growth path.
The fund consists of N350 billion for health and social welfare; N500 billion for agriculture and food security; N500 billion for the energy and power sector and N650 billion for general business support.
While analysts concede that President Bola Tinubu inherited several economic challenges when he assumed office last year, he has also taken what has been described as brash and knee-jerk actions, which saw the economy spiralling out of control.
Firstly, Tinubu abolished the petrol subsidy regime (though reintroduced in a veiled manner) without any cushioning effect whatsoever. This has pushed the cost of transportation, food and other goods to stratospheric heights.
Again, he floated the naira to end what he called the naira subsidy bazaar and the weak local currency was immediately buffeted by market forces and it tumbled to all-time low of N1,990/$1 at some point.
Since then, the monetary and fiscal wings have struggled to nurse the economy back to life.
Analysts are unanimous about the fact that the current economic challenges have been accentuated by terrorism, which many said Tinubu’s predecessor, Muhammadu Buhari, handled poorly as terrorists have sacked many agrarian communities, forcing farmers to abandon their farms and hole up in congested Internally Displaced Persons’ camps.
One of the effects of that is the current food scarcity horror, which has tossed millions risking annihilation.
The Director General, Centre for the Promotion of Private Enterprise (CPPE), Dr Muda Yusuf, told Sunday Sun that the main compass needed for the PECC to navigate the drifting economic ship away from tempest back to shore of hope was to have the policy and regulatory environment tweaked through more presidential orders and policy support.
“Policy and regulatory environment is first thing. Some of the manufacturers said high import duty is affecting their operations and swelling the cost of goods.
“The presidency recently gave a waiver on excise duty, VAT etc, on pharmaceutical products. It should be replicated across other sectors like agriculture. Food is currently very expensive.
“If we do this, we shall get benefits in terms of growth and the price of foods and goods will reduce, but we may lose some revenue, which is still okay.
“We need a lot more of that. Fiscal reforms of Taiwo Oyedele will feed into this goal.
“The insecurity monster should be slayed to get agric back on stream. National grid can’t carry our weight for power, so we need something done in the power sector.
“Exchange rate used for importation of import duty should be pegged so we have some sort of stability. It has a high impact on imports. Taiwo Oyedele recommended N800/$1 which is better than N1,500. Policy issues should be taken seriously one after the other.
“It’s good the president is the chairman of the PECC. It shows his commitment. The team has a blend of technocrats, government officials and all that.
“They need a strong secretariat which will do a very tough work since these guys are very busy or else, nothing will be done,” Yusuf explained.
He also blamed successive administrations for creating strong individuals rather than institutions, which have sunk the economy.
“You can’t compare what we had 20-30 years ago to what we have now. Merit is relegated. What’s in it for me now looms large. If it’s all about what people get out of the system, then we can’t get it right.
“Refineries can’t work for decades. What’s the rocket science behind having them work? Look at what that has caused.
“Bureaucrats have been there for ages and the system is decaying steadily. Now corruption is endemic, including in the military. These reflect how low we’ve sunk.
“Tinubu inherited a terrible economy in terms of dysfunctional policies.
“Under Buhari, oil sector deteriorated. Niger Delta became almost an ungoverned space as if we had no government. Oil sector is key to our economic life.
“Now, Kyari said we should declare a state of emergency on crude oil production. The ecosystem of the oil sector is bad. Tinubu inherited that. Few crude produced was sold upfront. FX management was handled via connection and many more rot he inherited”, Yusuf added.
To address the current economic challenges, analysts have called for comprehensive economic reforms and a commitment to creating a stable and conducive environment for growth and development.
Some of them are; reducing dependence on oil by investing in other sectors like agriculture, technology, and manufacturing; enhancing transportation, power supply, and communication networks to boost productivity and attract foreign investment; combating corruption and improving governance to create a more transparent and efficient system; investing in education and vocational training to build a skilled workforce; implementing sound monetary and fiscal policies to stabilize the currency and control inflation and creating an environment that supports startups and small businesses through access to finance and favourable regulations and strengthening trade relationships within Africa to create larger markets and enhance economic resilience.
Each of these steps requires coordinated efforts from the government, private sector, and international partners to achieve sustainable growth and development.
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