It’s too early to crow

It is too early to crow but you must excuse the federal government for doing just that. Its reputation for sound economic husbandry has grown only question marks since the blight of recession hit the national economy. It feels like a great victory for the government that the economy is responding to its shock treatment, the Economic Recovery and Growth Plan. It holds out this as evidence, if anyone needed some, that its economic management is sound and well-intentioned and that the recession was just a passing back luck.

However, I think it is rather too generous for the government to conclude that the marginal growth in the economy in the last quarter is the end of the recession. What we have so far only raises hope that the economy has moved from negative growth to positive growth. The National Bureau of Statistics released details this week to show that the economy showed a positive growth of .55 per cent in the second quarter of this year. 

But what does this mean in real terms? To understand it, you have to pick your way through a thicket of statistics that are strange and incomprehensible to most of us. I am not going to burden you with all that. Economic growth is a slow process. A growth of .55 per cent does not amount to the full recovery of the economy. It is only a sign that the situation is no longer that bad and that if our luck holds, the economy would bounce back with time and the country would once more be awash in petro-Naira. 

The good times are not about to roll. Sadly, so. There are always too many buts in economic management because the economy has a tendency to be petulant and show bad manners at the wrong time. The federal government owes it to itself not to be too quick in raising the hope of the people in a recession free economy. There were obvious difficulties in the economy before recession was fingered by the experts as the real worm in our economic apple. I do not think those difficulties would simply melt away with the .55 per cent growth in the last quarter. I do not think this means that state governments that are unable to pay the salaries of their civil servants would now do so. I do not think this means that the federal government would meet the demands of ASUU and the universities would reopen their gates to their students soon enough. 

Celebrating .55 per cent growth in the economy shows just how far down we had gone. To think the economy once had an annual growth rate of 7 per cent!

We have reasons to be happy. And we have reasons to be cautious. Crowing and celebrating the end of recession as the government people are doing right now, masks the long road to the full recovery of the economy. Economic management does not respect quick fixes. Experts have quickly pointed out that the fundamentals were still shaky. A week before it gave us the good news, the bureau released a report showing that the inflation rate was 16.9 per cent. That was bad news. If the economy is growing and inflation is rising, it is not difficult to appreciate the fact that if not caged, inflation would cancel out whatever gains we expect from the improved health of the economy.

President Muhammadu Buhari appreciates the expectations of the ordinary Nigerians in an improved, recession free economy. He told reporters in his country home, Daura, after he received the news of the end to recession that it should mean improved conditions for Nigerians. That is where his continued challenge as the chief manager of the nation’s economy lies. However much we may wish it so, there would be no automatic impact because the gains of an improved economy would still take a long time to trickle down to the majority of our people.

 For me, the good news in all this is that agriculture and manufacturing were largely responsible for the growth rate. Agriculture recorded 3.01 per cent positive growth in the period. This important but often neglected sector of the economy has shown a steady growth so far this year. The NBS report showed something else: in real terms the non-oil GDP contributed 99.1 per cent of GDP. In plain English, oil is no longer the king of our economy. Agriculture is steadily inching up.

The minister of agriculture, Chief Audu Ogbeh, a farmer himself, has always demonstrated his absolute faith in agriculture as the real driver of our economy. I am glad that under him, agriculture is asserting its place and relevance in our national economy. In appointing him minister of agriculture I suspect the president wanted him to prove what he has been preaching for years about the capacity of agriculture to transform our economy in real terms and make our peasant farmers live rather than exist with their small peasant holdings; to make the country a net exporter of agricultural produce rather the net importer of food, beef and poultry. It is a crying shame that with its 80 per cent arable land, Nigeria has for years depended on rice importation from South Korea with only 30 per cent arable land.  I believe the greatest legacy of Buhari’s presidency would be the 100 per cent, not 50 per cent, revamping of agriculture. Nigeria would be truly independent only when it attains the capacity to feed itself first and feed others too.