JUST about a month ago, the finance minister, Kemi Adeosun, while addressing the Senate, used the following words: “Technically, Nigeria is in recession but we should not go into definition…” She went on and on, in a desperate attempt to allay the throbbing perturbations of average Nigerians by saying, “We should be confident about what we are doing. I want to assure Nigerians the economy is in good hands and we are absolutely doing our best. We want to assure Nigeria we are on the right path, we are on the right track.”
Sadly, however, the realities that confront the commoner are in absolute contrast with Adeosun’s wavering declarations of expertise. Wavering declarations of expertise I reiterate because without being bequeathed the gift of clairvoyance by the gods and sans any form of savvy in the technicalities of economics save from the basic secondary school scale of preference, opportunity cost definitions I crammed years ago, I was able to decipher, long before Adeosun came up with the ‘technically’ phrase, that horrendous darkness, like some spell cast from very dark magic, snuffs the nation’s economic candle. The bafflement, however, isn’t interred in the carcass of the economy, but lies in the fact that this open secret, which the illiterate market women grasped several months before last month, effectively eluded the watchful eyes of its greatest custodian and acclaimed expert. Nigeria’s economy is not only technically in recession, it is sliding towards comatose and has so been long before 21 July, 2016. We just chose to ignore the writings on the wall while preferring to collectively indulge ourselves in delusions of conquering corruption while the economy burnt like Nero was engrossed with playing with his fiddle!
Technically, like the minister said, Nigeria is in recession, but without apparently sounding recalcitrant, I cannot but go into definitions for the sake of the commoner…
A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. According to economists, a recession is usually characterized by a drop in the stock market, an increase in unemployment rate and an upsurge in inflation indices, and Nigeria is already experiencing all these.
As a matter of fact, four days before Adeosun’s desperate attempt of assuage at the Senate, the National Bureau of Statistics reported that the Consumer Price Index used in measuring inflation in the country had hit 16.5 per cent, the highest in the last decade. It also came after the International Monetary Fund disclosed that Nigeria’s economy has been projected to contract this year. According to figures from the National Bureau of Statistics, unemployment rate in Nigeria as at March quarter of 2016 reached 12.1 per cent, the highest ever since 2009.
Yet, Adeosun admonished Nigerians to put their lives in the hands of her office, while making light of these petrifying facts and the grim predictions of the IMF, saying “We should not be worried about IMF. We should be confident about what we are doing,” but what are we doing?
Allow me to refresh your memory with the following facts, according to statistics from NBS, the last administration handed over a $550 billion economy (largest in Africa and 26th in the world), with 7.5 per cent unemployment rate (better than European Union, France, Sweden, Belgium) a stock of reserves of $30 billion; GDP growth rate averaging 6 per cent over last 12 years; a relatively more diversified economy, with ICT penetration from 0.2 per cent to over 60 per cent, and a new contributory pension scheme now with trillions of Naira in pension fund.
Nigeria has consolidated and stronger banking system that currently finances both government debt and the private sector, with a relatively vibrant capital market. The capitalisation of the Nigerian Stock Exchange grew from less than N1 trillion to N12 trillion as at handover.
For the first time, Nigerian economy was rated by credit rating agencies. It was also a PDP former president, Olusegun Obasanjo, who secured debt relief for Nigeria, thereby relieving Nigeria from the stranglehold of the IMF/World Bank policy conditionality.
Harrowingly today, I am drifting, like several other Nigerians in Nigeria at this precarious time, on a raft of endless uncertainties… where will the next meal come from? Will the next salary be paid in full? Will the price of Garri remain at N250 or go higher? will a graduate get a job immediately after service?While I, like the bulk of average Nigerians, stare at these fiends and even more, hapless, I must congratulate Nigerians in the Diaspora. A friend of mine living in South Africa recently said, “these are the best times to be a Nigerian in the Diaspora” and I couldn’t agree with him more. Surely, blessed are the Nigerians outside the shores of Nigeria as this recession thickens.
The South African Rand just gained an almost 100 per cent appreciation over the naira, what used to be a naira to about 13 South African Rand is today a naira to 25. My friend said “I would rather do a menial job here than come home after my post graduate degree. If I make 5000 here, it is over a hundred thousand in Nigeria.” Same was the submission of another pal in Canada… with an exchange rate of over N300, at 27 dollars per hour for 12 hours per day, in 30 days he would have made 9720 dollars and in naira? Do the calculation but the finance minister says we are on the right path and I hope she is right.