By BENJAMIN UMUTEME -Leading economist and Chief Executive Officer of Economic Associates, Dr. Ayo Teriba, has said that Nigeria needs sectoral, resource and revenue restructuring. and not the political restructuring.
According to Dr. Teriba, the uneven distribution of the country’s wealth was responsible for the clamour for political restructuring adding that it would benefit Nigerians more if they concentrated their energies on restructuring the revenue base of the country.
Dr. Teriba, said this at a retreat for staff of the Bureau of Public Enterprises (BPE) in Abuja, also added stimulating Foreign Direct Investment (FDI) inflows into the country will help solve the country’s liquidity challenge and bring it out of recession.
Nigeria entered into a official entered a recession in the middle of last year after it started experiencing negative economic growth from the fourth quarter of 2015. This is after experiencing 6-7 per cent growth in the last several years.
“Privatisation is the tool which most countries use to check their liquidity issue and beef up the economy and Nigeria can also do the same by privatising some of her key sectors”, Teriba stated, adding that a macro-economic approach to privatisation is ideal.
“To solve Nigeria’s liquidity problem, she needs foreign exchange inflow. Nigeria’s annual export revenue has been halved. Nigeria’s problem is that other problems are symptoms of the (liquidity) problem. Recession is reflecting a liquidity shortage,” he said.
While citing Saudi Arabia and India as a case study, the renowned economist pointed out that many countries are privatising their critical sectors to raise funds to develop their economies saying that privatisation is now the trend the world over.
Dr. Teriba explained that Saudi Arabia avoided recession because of its huge foreign reserves. Saudi Arabia plans to raise about $200 billion through the privatization of 16 sectors ranging from healthcare and airports to education.
The CEO of Economic Associate noted that Nigeria relies almost exclusively on volatile export revenue and neglected opportunities to attract massive and more stable diaspora and FDI inflows, whereas “non-resident Indians and Chinese invest massively at home to fund economic recovery and growth efforts of their respective countries.”
He wondered why has refused to copy the model even as he added regrettably that Nigeria which used to attract more FDI than India, South Korea, South Africa and UAE was no loger attractive.
He called for the opening up of the vents for investment to flow by breaking all government monopolies as has been done in telecommunication and power sectors.
“China’s inward FDI stock rose from $20bn in 1990 to $1.08trillion in 2015 and Nigeria held nearly half of what China held in 1990 but held only nine percent of what China held in 2015. Where did we go wrong?” he asked.
Teriba further revealed that although Nigeria has about N100 trillion in her economy, it was not evenly distributed and suggested that instead of the present agitation for political restructuring, those in its vanguard should agitate for sectoral, resource and revenue restructuring.
Declaring the retreat open, the Director-General of the Bureau of Public Enterprises, Mr. Alex A. Okoh, said the aim is to help the Bureau in applying a different kind of thinking by involving every member of the BPE family in a strategic episode where “we can together build a bridge between the dream of a new BPE and the actions that we must collectively take to make that dream a reality”.
This new vision for the Bureau is hinged on the two pillars of the new vision of the Bureau—Rediscovery and Repositioning. The rediscovery pillar, the DG said would lead the Bureau to retrace and redefine its core values and reclaim its culture of professionalism, knowledge, competence, integrity and transparency. The repositioning pillar, on the other hand, aims to set the Bureau on a path that would help it engage with the future effectively and with confidence, to guarantee that its objectives are achieved.
