Awka – Prof. Chukwuma Soludo, a former Governor of Central Bank of Nigeria (CBN), has said that Nigeria can overcome the current economic setback faster if the government put in place appropriate policies.
Soludo spoke at the 2017 International Conference organised by the Department of Business Administration of Nnamdi Azikiwe University, Awka, on Thursday,
In a lecture entitled: “Managing a Recessed Economy”, Soludo said that managing and exiting a recessed economy was not a rocket science.
He blamed the country economic woes on bad policies in the time of boom.
He said that the recession which became obvious one year into the life of the present administration would not have degenerated but for the inability of policy makers to rise to the challenge.
“Poor ideas transcended over superior ideas, and we went into recession which was slightly avoidable, that is why academics must be alive to their responsibility of nudging us to reality,” he said.
He emphasised that the foundation for the recession was laid by the previous administration, which he said, borrowed to fund recurrent expenditure at a time when oil prices were as high as over 100 dollars to a barrel.
The former CBN boss said that part of the problem was because Nigeria failed to save funds at a time when there was unprecedented boom in oil prices, but rather engaged in unprecedented borrowing.
“If you borrow at a time of boom, what will you do in time of lack? Even my grandmother in the village knows this. At the same time when we had boom, we had unprecedented unemployment.
“The problem with Nigeria’s successive policy makers is that once oil goes up, we take it that it will remain so, and we continue to spend.
“But once there is a shock and oil goes down, we just think it is temporary and we start borrowing.
“Nigeria can be fixed, and what it needs to fix Nigeria is not rocket science, but we do not have the will to fix her,” Soludo said.
Soludo also blamed the the Single Treasury Account (TSA), which he said, channelled all public sector funds to the CBN and stiffed the economy further instead of oiling it with liquidity.
“Part of the problem Nigeria is having in its quest to get out of recession was poor policy.
“Huge spending by government was one of the ways of solving the economic problem, but two wrong steps by government ruined that.
“They brought in the Single Treasury Account (TSA) and channeled funds into one account that did not allow spending, and they also fixed the price of foreign exchange. These are things you do not do.
Soludo advocated diversification of the economy beyond oil to save it from shocks induced by vagaries of the International oil market.
He further called for decentralisation from Abuja to help the states and local governments to live beyond running to the centre for their existence and sustainability.
“Another way of tackling the challenges of the country is to unbundle Abuja, trim down the exclusive list.
“We do not have to be running to Abuja for everything, that was why I was surprised when some people canvassed that local governments should be going to Abuja to take their allocations directly,” he said.
In his remark, Sen. Barau Jibrin, Chairman Senate Committee on Tertiary Education and TETFUND, commended the school for holding such thought provoking conference on way forward for the economy.
Jibrin, represented by Alex Unachukwu, said it came at a time when Nigeria needs the knowledge of academia to tackle its challenges.
Earlier, Prof. Joseph Ahaneku, Vice-Chancellor of the University commended the choice of Soludo as a lead paper presenter, saying he remains a world known economist, renowned for fixing economies.