By Adisa Adeleye
It appears as if the present Federal Government takes measurable delight in heightening the tension of the nation at the crucial time. At the time many Nigerians are expecting the National Assembly to be flooded with bills to create employment through infrastructural developments; the nation is being treated to a game of football with a no score result being celebrated by teams which lack creative strikers.

It is true that as in the game of football where there are blind strikers who need the constant shout of the coaches as the direction of the goalposts, there are also nations which need shouting of the populace for the complete developments of their state through demonstrations and fairy speeches through the media in a situation where the leadership is deaf, it may be necessary to gesticulate in so many practical ways so that the messages may sink deeply. The problem arises when leadership is blind, deaf and dumb, the means of communication become blurred or confusing, then, and the option lies with the communicator as to which method of communication to adopt. In the present case, one can assume that the leadership which is blind could hear the shout of agony of the sufferings of the people.

In the case of oil subsidy, (that is if there is that subsidy), it is a question of inability to formulate a realistic oil policy in order to manage our oil resources profitably. It will be necessary to know what the build_up is of the present N65 per litre of Premium Motor Spirit (Petrol). Some believe, and justifiably so, that the present price of N65 per litre does not allow for any subsidy. However, if the subsidy of about N1 trillion is based on the difference between the price of imported litre oil product and existing domestic price, then the lack of creative mind in official circles is glaring and disturbing.

How could a sensible oil producer become at the same time, an importer of the same product? The mere mention of subsidy in No 6 oil world producer is insulting if not disgraceful. Efforts should have been made in finding ways of increasing supply of products at home rather than resulting to the threats of removing oil subsidy.

Observers believe that the government has nothing to do with downstream sector of the oil industry of this country. Before the intervention of the government after the civil war, the private run downstream sector showed neither surplus problem nor any distress. What the government should concentrate on are improving these infrastructures to make the privately run downstream sector efficient and profitable if our roads are improved, if harbors are well constructed, if our railways are efficient, transportation of oil products to every part of the country would be cheaper and this would have beneficial effect on prices of oil products.

It is the interest of all Nigerians that the economy of this country is run without inflation i.e constant rises in prices. Inflation in layman‘s language is often described as ‘too much money chasing too few goods‘. The consequence of such a situation is that if there is much liquidity in the system, prices of commodities would tend to rise because of increasing demand without equivalent increase in supply of the products.

This is likely to arise in a situation in which there are no opportunities to expand the sources of supply of products in active demand. Such a situation may arise in a situation when full employment has been reached and manufacturing plants have no excess capacity.

However in Nigeria, the manufacturing industry is operating with less than full capacity. Some manufacturing plants have closed down because of lack of effective demand for their products and higher production costs, therefore, in such a situation, it is most likely that more money in the system that would stimulate excessive demand would encourage the manufacturing industry to produce more by utilizing idle plants and idle hands

It is a pity that the supply side of inflation has been sorrowfully omitted in the thinking of our officials. No serious efforts except selective aids have been made so far to salvage the dwindling or collapsing manufacturing industries. The Central Bank officials have been less creative in selecting methods to fight inflation.

Their approach has always been to curb excessive demand and not to promote copious supply. Their method of tightening monetary policy (squeezed credit) in an unemployment situation is more ‘classical‘ in thinking and orientation than what modern economic demands.

If the country is to rely on the fear of inflation which admittedly is dangerous, and source to higher lending rate (to encourage domestic savers), lower naira rate of exchange the economy may be heading to an uncomfortable situation. In an attempt to curb inflation, we may be heading towards the destruction of our domestic manufacturing industry. It has been repeated several times that a strong naira is necessary for an import dependent nation like Nigeria where our economic infrastructures needs rebuilding.

It is not a sound economic policy in a dormant economy to make available foreign equipment and necessary raw materials costly. We need not devalue in order to promote export since oil, our greatest export is determined in dollar and our locally produced goods are not there to earn more foreign exchange.

A more reasonable approach would be a policy of rising income that would stimulate effective demand and allow domestic industry to grow and create more employment. The fiscal accompaniments would be to protect the domestic industry against unhealthy competition and smuggling.

It is a serious mistake for the present government to equate itself with the advanced nations of this world in relating to economic matters. Most of the nations in the western world have strong manufacturing industries and expansive agricultural production. They are rich enough to feed themselves and export surplus or give away their agricultural products to other nations. However, in Nigeria, the domestic manufacturing industry has never been lucky to be favoured by any progressive administration.

Also, the agriculture industry which is still in its traditional or primitive stage is also favoured by words of mouth and not real action. The official thinking is along creating big agricultural estate or gigantic plantations. What is needed now is a modern approach to traditional farming which will ensure profitable farming. The rural farmer needs education, more productive farming implements and cash for crop market.

It looks as if the country‘s urgent need is expanding the economy with prospects of more employment and not a back looking policy of another bout of credit squeeze. We hope some people are not blind, deaf and dumb.