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We’ll get out of recession fast if… —Akanbi

The senator representing Oyo South Senatorial District,  Adesoji Akanbi, speaks with MOSES ALAO on the recent worries expressed by the wife of the president, Hajia Aisha Buhari, that President Muhammadu Buhari’s government might have been hijacked by a cabal, the steps Federal Government can take to rebuild the economy.

 

WIFE of the president, Mrs Aisha Buhari recently alluded to the fact that only two or three people are controlling President Buhari’s government, leading to fears that the government might have been hijacked by a cabal. What is your take on this and what do you think it portends for the government to deliver on its ‘change’ agenda?

First, I believe Aisha Buhari is very close to her husband; she knows what’s going on within and outside the government. If it is true that the President Buhari’s government has been hijacked, then she is in the best position to know, though the Secretary to the Government of the Federation (SGF) was on air disclaiming the statement attributed to her.

 

She also raised issues about President Buhari administration keeping to campaign promises, with the different battles being fought by this government, such as economic recession, insurgency in the North-East, renewed militancy in the Niger-Delta and the anti-corruption fight, how will you say the government has fared?

It’s so obvious that the present administration has achieved a lot in the area of fighting insurgency.  Secondly, no previous government has ever taken the bull by the horns in fighting corruption like the present government.

But in the area of the economy, the indices are not palatable; the country is obviously in recession. Although the activities of the previous government and the mismanagement of our resources led us to where we are at the moment, President Buhari’s administration cannot keep on giving such excuses because people that voted for APC and rejected PDP did so because they wanted positive change. The present government must buck up to improve the standard of living of average Nigerians.  A lot of things need to be done to achieve that.  A country like ours running a monolithic economy in the face of dwindling oil prices and also losing over a million barrel of oil a day due to bombing and destruction of our oil and gas installations, will surely slip into recession.

 

In the present circumstance and given the fact that you were one of the senators who opposed the proposed sale of national assets to boost the economy, what do you think President Buhari should do to move the economy out of the doldrums?

It is my humble view and submission that Nigeria can and will still come out stronger and better from this current economic recession without necessarily opting for a cheap idea of selling our national assets. But this can happen if the country can urgently take drastic and sincere steps on some of the untapped resources that are readily available at our disposal.

One, the Federal Government should, as a matter of urgency, bring all the aggrieved groups in the South-South of the country to the negotiation table whereby all their genuine agitations can be addressed, because Nigeria as a country currently in recession cannot continue to lose millions of barrels of oil daily as a result of their incessant bombings of our oil installations in the region.

Two, in a country where we are spending less than 30 per cent of our income on capital expenditure and more than 70 per cent on recurrent expenditure, getting out of recession will hardly be quick. So, the executive, judiciary and the legislature must be ready to make sacrifice and even governors in various states must be ready to do away with their security votes and if need be, they have to be transparent about it. A country like Ethiopia, as of now, has reached a level where 60 per cent of its income is being spent on capital expenditure and 40 per cent on recurrent expenditure. This should be the ultimate target of this present administration.

The third step I think government can take is that despite the increase in our debt profile, it is still believed that Nigeria can borrow from the international financial institutions and use it to reflate the economy by quickly taking the advantage of the credibility of President Buhari, which is a good leverage, because some international financial institutions are ready to lend us money for infrastructural development.

Four, the current administration should reduce local borrowing in order not to be in competition with the private sector, because the banks prefer to lend money to the government than the private sector and that will further run down our economy.

 

Some people advocate made-in-Nigeria goods and agricultural revolution as a way out, saying it is high time Nigeria diversified its economy. What is your view?

I have it on a good authority that in 2015, Nigeria spent N630 billion to import food items and beverages. This shows our taste for foreign products, which must stop at this point, and all of us have a role to play by patronising made-in-Nigeria goods.

It is worthy of note that the present government has started well in the area of agriculture. But more still needs to be done to encourage our existing farmers and make farming more attractive to young graduates. And the good news is that we have the ability and capability to feed ourselves at a very reduced cost but the government has to play more roles in the area of providing transportation of farm produce to various markets at low cost. Government should put some palliative measures in place in this area.

However, outright banning of imported food items is not the real solution but this can be best done by placing high tariff on them to discourage importers and consumers. The Nigeria Customs Service has to play its statutory role by manning our borders efficiently so as to prevent the smugglers from getting those banned products to our various markets.

Of a truth, the diversification of Nigeria’s economy should no longer be a slogan as it used to be. Rather, all our energies should be concentrated on how to indeed diversify our economy. We have abundant mineral resources untapped all over the country in commercial quantities and most importantly our laws and policies need to be reviewed to attract foreign investors that will invest in our solid minerals sector in particular. But looking at this year’s budget, I doubt that this present government is serious with the idea of diversification with regard to solid minerals development. The sector received a lean budget. This sector needs huge amount of money to be invested in area of geological survey and all other useful data and information that can always be available for interested investors before it can generate substantial revenue for the government in the long run.

The new development in Ajaokuta Steel is good news and also a positive development towards sustainable growth.

The truth is if government can confront some basic challenges facing this country head-on, we will be out of this recession faster. Imagine how much we spend on the importation of fuel. Nigeria’s refineries must be put in good working condition, because we cannot continue to spend over 50 per cent of our forex-earning mainly from sales of crude oil to import back petroleum byproducts for our local consumption. We are left with very little foreign exchange, which is not adequate to support our manufacturing sector in the areas of machinery parts and raw materials procurement that will enable our industries to operate at maximum capacity. And this is the only way to create jobs for our teeming unemployed youths.

We also need to look inward to generate more revenues by widening our tax nets. In this kind of economy, people should not be overtaxed but there are still spaces where we can improve on our tax revenue. Our Value Added Tax (VAT) has been five per cent since the introduction of VAT for over 23 years and VAT is mainly on luxury goods. It should be reviewed upward.

 

But some Nigerians have said that the introduction of Treasury Single Account (TSA) brought the current hardship on Nigerians…

(Cuts in) I disagree. TSA is a good idea and it has helped to curb corruption in the system but the Federal Government has to ensure that much money is not kept idle in the central bank. A situation where large amounts of money are being deposited in Central Bank of Nigeria without making any positive impact on our economy should be reviewed and such money should be used to support our Small and Medium-sized Enterprises (SMEs) to the fullest. Without supporting SME, we will continue to have high rate of unemployment.

I want to also add that the Federal Government should dwell much on infrastructure concessioning, for instance, our four major airports in this country are not generating enough revenue for the government and this can be improved upon through concessioning arrangement. Some of these infrastructure can be upgraded to world-class standard. Instead of embarking on sale of our national assets, the government should embrace the concessioning idea.

 

It will be recalled that the government promised different palliative packages, how far has it gone in fulfilling this promises?

The palliative measure by the government should take off immediately and all the bureaucracy bottlenecks should be eliminated with immediate effect, so that people can enjoy the benefits the sooner the better. And let me also say that the economic team needs to be proactive. Our monetary and fiscal policies should complement each other and the interest rates should be reviewed further down. A situation whereby the Minister of Finance and CBN governor are contradicting each other will erode the little confidence left in the economy and that will not help our economy to grow.