BENINâ€”DEAN, Faculty of Management Sciences of the University of Benin, Professor Esosa Bob Osaze, has said that beyond the palliative measures provided by the Federal Government to cushion the Nigerian economy against the global economic meltdown, there was need by the government to provide long-term economic packages against another economic meltdown.
He listed such measures to include stimulus packages for industries, including the banks, a total reform of the banking sector to focus on core banking; improving the risk management profile of banks through risk-based supervision and reduction in the interest rates to stimulate borrowing and investment.
He also called for a reform of the capital market to assure proper regulation; introduction and effectuation of investor protection fund and the introduction of mandatory corporate governance codes for industry and the financial sector as well as focus on energy, infrastructure, education and capacity building for economic growth and development.
Prof. Osaze, who in his paper,Â Quo Vadis Nigeria In The Global Financial Meltdown, delivered at the University of Ibadan Alumni Association, Edo State chapter, yesterday insisted that the Central Bank of Nigeria must focus fully on its mandate of maintaining price stability as clearly defined in Section 2 of the CBN Act, 2007.
â€œWith these measures, will Nigeria emerge stronger from the meltdown? Of course yes, with the right type of economic leadership, well steeped in impeccable corporate governance and deeply driven by an energizing vision. Otherwise, and the saying goes â€œthe answer my friend, will be blowing in the wind,â€ he said.
He recalled that before, the global economic melt down, the Nigerian economy recorded a decent growth rate of 3.5 %-4% per annum while the nation had a sizeable foreign reserve of about $62 billion as at December, 2007, just as its Stock Market has a remarkable market capitalization of over N10.18 trillion and a market index ofÂ 57,990.
He, however, lamented that the effect of the global contagion dropped the economic growth rate to about 2.0% per annum, the foreign reserve to $40 billion, the stock market to N5.2trillion and the index to about 22,000 points.
The university teacher listed the areas mostly affected by the economic meltdown to include a drop in oil revenues and its consequent threat to budget estimates, threat to the 7-point agenda of the government and consequently, vision20-20-20 and flight of foreign portfolio investment due to stock market bubble burst.