ICYMI

May 29, 2024

Six things Tinubu must do to succeed — Atiku

Obasanjo

•Gives reasons why Tinubu’s one year rule hasn’t yielded desired fruits
•Says trial- and-error economic policies won’t work

By John Alechenu

ABUJA: Former Vice President, Atiku Abubakar, has listed six actions President Bola Tinubu must take if he was desirous of making a success of the responsibility of the office he currently occupies.

Atiku, who was the presidential candidate of Peoples Democratic Party, PDP, offered the advice in a statement made public in Abuja yesterday.

He said: “First, pause and reflect. It is important that the government understands what reforms must be undertaken and in what sequence. A framework is needed with clearly stated reform objectives and strategies.

“Second, undertake a comprehensive review of the 2024 budget within the new reform framework. The 2024 FGN budget, the exact size of which remains a mystery, is not designed to address the structural defects of the Nigerian economy or the cost-of-living crisis. It will neither create prosperity nor promote opportunities for our young people to lead a productive life.

“The review must prioritise fiscal measures to deal with an unprecedented rise in commodity prices. Higher commodity prices have created more misery for the poor in our towns and villages and have pushed millions of people below the poverty line. One of such measures for immediate implementation will be to ease the existing restrictions on selected food imports.

“Third, undertake a comprehensive review of the Social Investment Programme, SIP, to mitigate some of the impact of these policies on the most vulnerable households. The SIP must go beyond Conditional Cash Transfers to include programmes that prioritize support to MSEs across all the economic sectors, as they offer the greatest opportunities for achieving inclusive growth.

”In addition, a holistic programme to support medium and large-scale enterprises to navigate the stormy seas in the aftermath of the withdrawal of subsidy on PMS is also needed.

“Fourth, Tinubu must be cautioned against any attempt to further pauperize the poor by introducing new taxes or increasing tax rates. We are aware of the behind-the-scenes attempts to increase VAT rate from 7.5% to 10%, re-introduce excise on telecommunication, and increase excise rates on a range of goods.

”It needs to be restated that we cannot tax our way out of this situation. Instead, Tinubu must see the need for expenditure rationalization and restraint by having the budget more in sync with Nigeria’s fiscal reality, by improving efficiency in revenue utilization, improving procurement processes and trimming the size of government and, therefore, reducing the cost of governance.

“Fifth, provide clarity on the fuel subsidy regime, including the fiscal commitments and benefits from the fuel subsidy reform and the impact of this on the Federation Accounts.

“It is curious that since April 2024, fuel queues had mounted at many filling stations across Nigeria, and the infamous ‘black market’ has sprouted in several states. How much PMS is being imported and distributed, and at what cost? What is the implicit subsidy?

“Sixth, tackle security headlong. President Tinubu, as a matter of priority, needs to rejig the nation’s security architecture as what is currently in place is not serving the needs of the people. The state of pervasive insecurity continues to adversely impact agricultural production and the value it brings to the economy, especially in the northern parts of the country.

“Insecurity resulting from terrorism, banditry, kidnapping, and cattle rustling has compelled many crop farmers and pastoralists to abandon their lands and relocate to the neighbouring countries of Niger, Chad and Cameroun.

“This has drastically caused a reduction in the production of food and skyrocketed prices of foodstuffs. Food scarcity in Nigeria is so dire that a report by Cadre Harmonize warns that between June and August this year, about 31.5 million Nigerians may face severe food shortages and scarcity.

”I have always been a reform advocate. The Nigerian economy certainly requires a large dose of reform measures to accelerate its transformation after many years of lacklustre growth.

“I was prepared for reform fallouts. Tinubu wasn’t. However, it is not too late for him to change course and do what is right for the good of our people and our nation.”

Why Tinubu’s one year rule hasn’t yielded desired fruits

Explaining why Tinubu’s first year in office has not yielded fruits, Atiku stated: “Tinubu laid out no plans for the ‘remodeling’ of the economy but soon embarked on a cocktail of policies to achieve it.

“In May 2023, he eliminated PMS subsidies, and a month later, the CBN implemented a new foreign exchange policy that unified the multiple official FX windows into a single official market.
“More policies followed in rapid succession: the tightening of monetary policy to reduce naira liquidity, a hike in monetary policy rates, the introduction of cost-reflective electricity tariff, and a cybersecurity tax.

“Predictably, 12 months on, Tinubu’s pledge of growing the economy and ending misery remains unfulfilled. His actions or inactions have significantly worsened Nigeria’s macroeconomic stability. Nigeria remains a struggling economy and is more fragile today than it was a year ago.

“Indeed, all the economic ills – joblessness, poverty, and misery – which defined the Buhari-led administration have only exacerbated. Africa’s leading economy has slipped to the 4th position, lagging behind Algeria, Egypt, and South Africa.

”Citizens’ hopes have been dashed (and not renewed contrary to the propaganda of the administration) as Nigeria’s economic woes have multiplied.

“In my press statement on the state of our economy, earlier this year, I expressed my concerns about the downside risks of unleashing reforms without sequencing; without any ideas on how to implement them; and without any regards to their potential and real devastating consequences.

”Implementing policies without proper planning and a clear destination is nothing other than trial-and-error economics. My concerns have not diminished. I will focus on just four areas to underscore those downside risks associated with Tinubu’s reform measures and their dire consequences on Nigeria’s medium to long-term growth and development.

“First, President Tinubu’s policies do not create prosperity. Instead, they pauperize the poor and bankrupt the rich.

“They spare no one. Nigerian citizens, the majority of whom are poor, are going through the worst cost-of-living crisis since the infamous structural adjustment programme of the 1980s.
“The annual inflation rate at 33.69% is the highest in nearly three decades.

”Food prices are unbearably higher than what ordinary citizens can afford as food inflation soared to 40.53% in April, the highest in more than 15 years.

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