By Babajide Komolafe & Praise Akpaibor

Prominent economists and investment experts have identify fiscal discipline as the key to addressing Nigeria’s macroeconomic challenges including naira depreciation and the huge public debt. 

The experts who spoke at the Comercio Partners Half Year Economic Review and Outlook Conference include Chinwe Egwim,  Chief Economist and Head Economic Research at Coronation Merchant Bank; Nnamdi Nwizu, CEO, Comercio Partners trading; Ugodre Obi-Chukwu, Founder Nariametrics; Tayo Aduluju,  CEO,  Nigerian Economic Summit Group. Others are  Professor Philip.O. Alege, Professor Economics Covenant University, President Nigerian Association of Macroeconomic Modeller, NAMM; ,Tope Fasua, Special Adviser to the  President on Economic Affairs in the Vice President office; and Mr.Farooq Oreagba, CEO of NG Clearing Limited).

Osunkoya in his opening remarks said that the conference is designed to proffer solutions to the many challenges confronting the Nigerian economy, which include huge debt, inflation and the high cost of funds induced by the high interest rate regime. 

“It is our responsibility at Commercial Partners to gather together a panel of renowned financial and economic experts to not  talk about the challenges but to  to the process of crafting, forging  executable plans that will move us ahead and forge or write a new narrative for this country,” he said. 

According to Obi-Chukwu of Nairametrics, fiscal discipline and reducing the fiscal deficit are keys to having a stable exchange rate.

He said: “So long as you continue to run large fiscal deficits, your exchange rate can’t be stable.  It’s not possible.  If you want your exchange rate to be stable then you sacrifice high interest rates. There must be a lot of deliberate attempt to have a roadmap towards reducing the fiscal deficit.”

Affirming this position, Oreagba, while noting that cost of governance in Nigeria is one of the highest in the world, called for reduction in government expenditure.

“We can say a lot of things about raising money taxes, but we need to address our expenditure situation. Now we’re talking all the way from the guys in the government, the legislature. This is because no matter how much money you raise by taxes. If the basket is leaking, there is no amount of water you can put in that basket. It will continue to disappear.” 

While Professor Philip Alege noted that the productive capacity of the economy is very low, Nnamdi Nwizu stressed the need to channel borrowing to production activities. 

“Debt   isn’t bad. A lot of businesses survive on debt leverage. The problem you have with Nigeria is what you do with that debt. So if the debt goes into helping production, which will help you export, that is good.  So what we need to do is to try and channel borrowing into production generating activities,” Nnamdi said.