National Issues
COVID -19: Time to diversify Ngeria’s economy | By Abba Dukawa
Following the collapse of crude oil prices from 2014 to date , which triggered unpleasant memories to Nigerian government which found itself in unchartered waters. Since then Nigeria continues to struggle to revive the economy amidst dwindling oil revenues compounded by unemployment, poverty and insecurity all due to over dependant on one major government revenue, the country remains weak and fragile -being outstripped by population growth.
Who is to be blamed for this mess ? Provocative policy of the Nigerian government is the dependence on oil resources as a source of foreign exchange earnings to the detriment of agriculture despite the fact that the country is blessed with untapped mineral resources. With outbreak of the coronavirus, which has puts global economy in uncertainty again, Nigeria’s economy is being caught in the cross-hairs.
Nigeria the so called Africa’s largest economy cannot currently fund its budget due to Covid – 19 because the budget passed with a benchmark oil price of $57 per barrel—nearly double its current price of around $28, knowing fully well that the government relies heavily on petrodollars. It is now unarguably, the collapse of oil prices not only pose a strategic danger to the global economy but it has been danger to Nigeria’s economy development and also a catalyst behind national domestic predicaments.
Absolutely there is lack of foresight from our leaders for not save as much as possible especially when the crude oil price reached its peak but Nigeria Forex reserve is about $37billion and can finance 4months of imports max. Even before Covid -19 pandemic Saudi threw OPEC members under the bus because Russia refuses to cut production to prop price up.
Saudi flooded the market and offered discount to buyers. Russia refused production costs because it thinks; cuts empower Shale producers in America. Now Nigeria have about more than 50cargoes of oil floating on international waters without buyers. A cargo contains about 2 million barrels of oil.
Now Nigeria is facing severe challenges. Oil price volatility is accentuated by rising commodity prices, possibly the devaluation of the naira against the U.S. dollar. It s time for economy diversification.
Regards to diversification of the economy there is need for Federal government to develop the country untapped minerals. Despite this huge opportunity still domestic mining industry is underdeveloped, leading to Nigeria having to import minerals that it could produced domestically. With recent economy woes federal government should, as a matter of fact shift from mono economic policy to ensure that non-oil sector growth has translated to improvements in government revenue.
Had it been that past and present leadership prioritise other non oil sectors with the way the nation’s telecommunications sector liberalize definetly the country economy will improve because there is no state in Nigeria with less than 10 untapped different mineral resources.
Had it been that they did the needful for long the country will set itself free unless federal government develop the country untapped mineral industry, modernise the agricultural sector and develop the tourism industry. Just from iron ore , expert says Federal Government can make $280 billion from the mineral annually more than what the country earned from crude oil.
According to 2018 report of geology and mineral resources of Nigeria estimated Nigeria’s iron ore deposit to reach three billion tonnes, coal, three billion tonnes while lead and zinc are to reach 10 million tonnes each. Federal Government can make a lot of money from mining, if it is exploited and invest into coal, gold, tantalite, and cassiterite to shore up revenue.
Dukawa, a public affairs analyst, writes from Kano
In response to the escalating security challenges plaguing Nigeria, no fewer than 16 state governors have thrown their weight behind the establishment of state police forces.
This development was disclosed by the National Economic Council (NEC) during its 140th meeting, chaired by Vice President Kashim Shettima, which took place virtually on Thursday.
Minister of Budget and Economic Planning, Atiku Bagudu, who briefed State House Correspondents after the meeting, revealed that out of the 36 states, 20 governors and the Federal Capital Territory (FCT) were yet to submit their positions on the matter, though he did not specify which states were among them.
The governors advocating for state police also pushed for a comprehensive review of the Nigerian Constitution to accommodate this crucial reform. Their move underscores the urgency and gravity of the security situation across the nation.
Similarly, the NEC received an abridged report from the ad-hoc committee on Crude Oil Theft Prevention and Control. This committee, headed by Governor Hope Uzodinma of Imo State, highlighted the areas of oil leakages within the industry and identified instances of infractions.
Governor Uzodinma’s committee stressed the imperative of political will to drive the necessary changes and reforms needed to combat crude oil theft effectively.
Renowned academician, Professor Augustine Okereke, from the Medgar Evers College/City University of New York, has emphasised the detrimental impact of a lack of strong social institutions on Nigeria’s sustainable development.
Presenting a lead paper at the First Annual Ibadan Social Science Conference hosted by the University of Ibadan, Professor Okereke urged President Bola Tinubu to foster robust institutions capable of combatting corruption and addressing social ills.
“All our institutions are on the decline,” warned Professor Okereke, underscoring the urgent need for effective structures to facilitate sustainable development. He highlighted the challenges faced by African countries, emphasising the risk of continued poverty, underemployment, and injustice without these foundational structures.
The Dean of the Faculty of Social Sciences at the University of Ibadan, Professor Ezebunwa Nwokocha, asserted the university’s commitment to providing intellectual, context-specific solutions to Nigeria’s challenges.
He called on state and federal governments to patronise researchers in the country, emphasising the faculty’s reputation for producing intellectual leaders.
Professor Nwokocha stated, “Our faculty is reputed for offering deeply intellectual, workable, and context-specific solutions to the challenges faced by Nigeria over the ages.” He emphasised the significance of the conference’s theme in aiding Nigeria’s navigation through its complex existential reality marked by despair, rising inflation, insecurity, corruption, and unemployment.
During the conference’s opening, Vice Chancellor Professor Kayode Adebowale noted the relevance of the theme, “Social Science, Contemporary Social Issues, and the Actualization of Sustainable Development,” urging participants to generate transformative ideas for Nigeria.
Acknowledging the nation’s progress over 63 years, he expressed concern over setbacks in the economy and social indices, hoping the conference would proffer solutions.
In his keynote address, Professor Lai Erinosho stressed the rapid worldwide social change in the digital age, citing both benefits and unanticipated consequences for human survival. He cautioned against embracing same-sex relationships, citing dangerous implications for humanity.
The First Annual Ibadan Social Science Conference convened a diverse array of participants to explore solutions and intellectual leadership in addressing Nigeria’s pressing challenges.
As the country grapples with economic challenges, the latest figures from the National Bureau of Statistics (NBS) revealed a surge in the inflation rate to 28.92%, according to the December 2023 Consumer Price Index (CPI) released on a Monday afternoon.
The CPI, tracking the fluctuation in prices of goods and services, illustrates a notable increase from the previous month’s 28.20%, underscoring the pressing concerns surrounding the nation’s economic stability.
In a recent report, the Statistics Office revealed a notable uptick in the headline inflation rate for December 2023, marking a 0.72 percentage point increase from the previous month’s figure in November 2023.
On a year-on-year basis, the National Bureau of Statistics (NBS) highlighted a significant surge, with the December 2023 rate standing at 7.58 percentage points higher compared to the corresponding period in 2022.
December 2022 witnessed an inflation rate of 21.34 percent, underscoring the economic dynamics at play.
“This shows that the headline inflation rate (year-on-year basis) increased in December 2023 when compared to the same month in the preceding year (i.e., December 2022),” NBS said.
In a further revelation, the bureau disclosed that the month-on-month headline inflation rate for December 2023 experienced a 2.29 percent surge, surpassing November 2023 by 0.20 percent. This indicates a swifter rise in the average price level compared to the preceding month.
The report highlighted a concerning acceleration in food inflation, reaching 33.93 percent on a year-on-year basis for December 2023. This marked a substantial 10.18 percent points increase from December 2022’s rate of 23.75 percent. The data underscores the persistent upward trend in food prices, a trend exacerbated by various government policies, including the removal of subsidies on petrol.
Notably, in July 2023, President Tinubu declared a State of Emergency on food insecurity to address the escalating food prices. Taking decisive action, the President mandated that issues related to food and water availability and affordability fall under the jurisdiction of the National Security Council, recognising these as essential livelihood items in need of urgent attention.
In Monday’s inflation report, the National Bureau of Statistics (NBS) detailed the key contributors to the year-on-year increase in the headline index. The leading factors include food & non-alcoholic beverages at 14.98 percent, housing water, electricity, gas & other fuel at 4.84 percent, clothing & footwear at 2.21 percent, and transport at 1.88 percent.
Additional contributors encompass furnishings & household equipment & maintenance (1.45 percent), education (1.14 percent), health (0.87 percent), miscellaneous goods & services (0.48 percent), restaurant & hotels (0.35 percent), alcoholic beverages, tobacco & kola (0.31 percent), recreation & culture (0.20 percent), and communication (0.20 percent).
The report highlighted a substantial 24.66 percent change in the average Consumer Price Index (CPI) for the twelve months ending December 2023 over the previous twelve-month period. This represents a significant 5.81 percent increase compared to the 18.85 percent recorded in December 2022, indicating ongoing inflationary pressures in the economy.
Food Inflation
In a concerning trend, the food inflation rate for December 2023 surged to 33.93 percent on a year-on-year basis, marking a substantial 10.18 percent points increase from the same period in 2022, when the rate stood at 23.75 percent.
The National Bureau of Statistics (NBS) attributed this rise in food inflation to notable increases in the prices of various essential items. Key contributors include bread and cereals, oil and fat, potatoes, yam, and other tubers, fish, meat, fruit, milk, cheese, and eggs.
These price hikes collectively contributed to the intensified strain on consumers, highlighting the complex dynamics driving the upward trajectory of food prices.
“On a month-on-month basis, the Food inflation rate in December 2023 was 2.72 percent, this was 0.30 percent higher compared to the rate recorded in November 2023 (2.42 percent),” it said.
Clarifying the dynamics behind the recent uptick, the National Bureau of Statistics (NBS) explained that the month-on-month increase in food inflation for December 2023 was spurred by a heightened rate of escalation in the average prices of oil and fat, meat, bread, and cereals, potatoes, yam, and other tubers, as well as fish and dairy products like milk, cheese, and eggs.
“The average annual rate of food inflation for the twelve months ending December 2023 over the previous twelve-month average was 27.96 percent, which was a 7.02 percent points increase from the average annual rate of change recorded in December 2022 (20.94 percent),” the report added.
-
Opinion4 days agoTinubu’s Naira Miracle: Abracadabra or Economic Wizardry? | By Adeniyi Olowofela
-
Politics4 days ago
Why Oyo State cannot afford another 3 years of Makinde’s mismanagement of council funds
-
News1 week ago
FERMA House C’ttee Chair, Oseni Consoles Sen. Buhari over mum’s death
-
Politics1 week ago
APC Urges Fairness in Oyo LG Election
