Since the inception of the Tinubu administration, there has been a concerted effort to address Nigeria’s macroeconomic challenges. However, the impact of these policies has yet to trickle down to the micro level, where the everyday lives of Nigerians remain fraught with economic hardship. The disconnection between macroeconomic stability and microeconomic realities is a pressing issue that the administration must urgently address.
Some of these policies include removal of fuel subsidy and floating of the naira. According to some statistics from the camp of the president, these policies have yielded and are yielding some good results, for example they claim that our foreign reserves have grown from 34 billion dollars to 37 billion dollars. Our Ways and Means debts have dropped from N27 trillion to N16 trillion. They have cleared the N7-billion forex backlogs, the debt to revenue ratio has dropped from 97 per cent to 64 per cent and we are now generating 1.6 million barrels of oil production per day as opposed to 900,000.
Although some of these policies have been lauded by international organisations, it is important to note that the impact of macroeconomics does not always translate to micro realities. This is why it is imperative that the president begins to work more deliberately to allay the challenges of the Free Trade Zones.
The promise of Nigeria’s free trade zones, which are intended to spur economic growth and attract foreign investment, remains largely unfulfilled. The government’s inability to fully harness the potential of these zones stems from a lack of adequate infrastructure and persistent insecurity. This inadequacy hinders businesses from operating at their full capacity, thereby stifling economic growth at the grassroots level.
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Take, for instance, the plight of rice manufacturers who are forced to spend approximately N20 million illegally in some parts of the country monthly to secure 16 hours of power for their mills. This exorbitant expenditure on power alone significantly increases production costs, which in turn affects the prices of rice in the market. Similarly, farmers in various regions in deep northern states are burdened with illegal security taxes imposed by bandits, further driving up the cost of agricultural produce. The culmination of these illegal fiscal payments often leads to the indiscriminate increase in the cost of produce. These are just a sample of a few issues that are wrong with the country right now.
The government must recognise that regulating food prices and curbing the indiscriminate increase in market amenities is imperative. However, effective price control is contingent upon the government fulfilling its primary responsibilities. Ensuring that businesses operate in a secure environment with access to reliable infrastructure is paramount. Without these foundational elements, any attempt at price regulation is bound to fail.
One of the administration’s critical tasks is to safeguard the freedoms and liberties of businesses. Protecting businesses from extortion and providing them with the necessary infrastructure are crucial steps in creating a conducive environment for economic activities. By doing so, the government can then wield the authority to impose price controls that are not only enforceable but also sustainable.
The statistics and anecdotal evidence suggest that while the Tinubu administration has made strides at the macroeconomic level, there is a glaring need for policies that directly address the microeconomic challenges faced by ordinary Nigerians. Bridging this gap requires a multifaceted approach that includes enhancing security, improving infrastructure, and ensuring that the benefits of macroeconomic policies are felt at the local level.
The success of the Tinubu administration’s economic policies hinges on their ability to translate macroeconomic stability into tangible benefits for all Nigerians. By prioritising security, infrastructure, and the protection of business liberties, the government can create an environment where price controls are effective, and economic growth is inclusive. Only then can the administration claim true success in its economic agenda.
Mukhtar Suleiman wrote from Abuja
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