The main issue with President Tinubu’s economic policies is not only the unmitigated hardships they have brought on the majority of Nigerians, many are of the opinion that the country cannot hope to realise its economic objectives going forward with these policies. This is a view shared not just by Nigerians across the board but also by such hallowed capitalist media institutions like the Financial Times, Economist, Bloomberg, World Street Journal and even the International Monetary Fund (IMF) and World Bank which are known to favour and promote such policies.
The Financial Times called Tinubu’s policies “flawed’’ while the IMF does not believe that Nigeria’s quest for growth will be attained under the policies.
The fundamental reason why the policies are ‘’flawed’’ is that not being an industrial, manufacturing one, the Nigerian economy is not well positioned to benefit from the devaluation of the naira which President Tinubu implemented upon coming to power. Were Nigeria to be like Brazil, Indonesia, Egypt or the like where goods are produced on an industrial scale for export, devaluation of the currency would result in attracting investors taking advantage of the competitive value of the currency to invest and export.
As Nigeria is not an industrial economy currency devaluation favours more speculation than production because investors in this case would not like to keep their funds tied down to a volatile currency subject to swings. That to some extent explains why the naira has been subject to wild fluctuations over the past few months. Rather than industrial exports leading the way to recovery and growth and in turn stabilising the position of the currency, it is the government that now has to inject hard-earned foreign currency into the market to shore up the naira. How long can the government sustain the practice?
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Similarly, as with currency devaluation, the removal of subsidies resulting in inflation and high operating costs for most businesses hardly encourages investment and productivity in the economy.
From the conclusion of many, the bandwidth of Tinubu’s economic policies is not far-reaching enough to address the fundamental issues of the Nigerian economy.
Going forward, what is needed to complement the current economic policies in place is a massive industrial development policy that will set the stage for industrialising the country.
Industrialisation is an imperative for Nigeria and we cannot continue to shy away from it. It has many advantages not least is the acquisition and application of scientific technical thinking and innovation to solve some of the most fundamental areas of our lives like agriculture, medicare, construction, infrastructure, transportation, education etc. At present, for all these critical areas, we have to rely on the thinking and expert service of foreign countries. Apart from costing us plenty thereby depleting our foreign exchange position, this also keeps us behind and less competitive in the global economy.
A country cannot be relevant in the world if it throws its economy to continuous speculation from within and without. Such a country will continue to economically stagnation and with time become a target of stronger economies.
Unfortunately, President Tinubu has continued in that trajectory of economic policy implementation which gives room for rent collection and speculation.
Having completely removed subsidies as well as floated the naira, policies which in effect can be considered in figurative terms as crossing the Rubicon in economic policies in Nigeria, President Tinubu ought to go the whole hog and follow it up with an industrialisation policy that will harness our human and material resources in building an economy that will be more relevant in global economic exchange.
That is the fundamental economic challenge Nigeria faces in the world today. For too long flushed with rather easy revenues from the export of crude oil, we have neglected to take the bold but necessary steps to industrialise Nigeria which will launch us into the status of an industrial power producing most of its needs and exporting value-added goods and services. It is within this context that President Tinubu’s call for understanding and necessary sacrifices by Nigerians on his economic policies can be meaningful and secure compliance.
How do we embark on this Industrialisation policy?
We can embark on this industrialisation project from two approaches; private investment and partnerships and bilateral scientific and technical agreements with selected countries especially those in the bracket of emerging economies.
In this regard, Nigeria must be strategic. We must leverage our population as a market and also as a source of huge labour for industrial production. We must also offer our country as a potential internal and regional hub for industrial investment and production and as a base for the manufacture of industrial goods to third-country markets within the African region. This will place us in the position of the industrial powerhouse in the African region and even beyond.
In embarking on the industrialisation project, we must be ambitious, imaginative and focused. We must diligently plan and set industrial production targets for sectors of the economy and measure them according to the overall national estimates and targets. Allocation of resources and incentives should also be on the basis of need, relevance and performance.
At the outset of his administration, President Tinubu had proclaimed that his will be to make a difference by departing from the practices of the past, especially in tackling the economy. Whether he was merely making a rhetorical statement, as politicians often do, or he really meant it remains to be seen in practical terms.
As a signal of intent, President Tinubu has already taken the first steps by removing subsidies on petroleum products and effectively devaluing the naira. These are no doubt bold and fundamental moves the effect of which has led to uncertainty regarding the economic future of the country. This is not helped by the observable fact that whereas the president has called on Nigerians to understand and bear with him on his economic policies, his administration seems bent on continuing in the profligate ways of the past.
But what seems more worrying to Nigerians is that following the announcement and implementation of his economic policies, which has brought so much suffering and uncertainty in the land, he appears stuck and at odds on what direction he should take next in advancing and maximising their potential. Is it that the courage and boldness which made him embark on the policies he implemented has come to an end? Were the policies programmed to achieve narrow ends only and that once done, as it now appears, he has neither the inclination, stomach nor vision to continue down the line?
Nigerians in their current state of angst are waiting for answers to these questions which must be provided in practical and measurable not rhetorical and token palliative terms. President Tinubu should know that if this stalemate persists, it carries the risk of a blowback which will do nobody good. (Concluded)
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