Nigeria’s Gross Domestic Product, GDP, growth of $594.26 billion, which made the country the largest economy in Africa is a jobless growth,The 1st Vice President of the Chartered Institute of Bankers of Nigeria, CIBN, Segun Ajibola has said.
Ajibola, who spoke on “Oil Price Downturn and Forex crisis: Challenges, Possible Solutions and Challenges,” at the Third Roundtable on Nigerian Economy organised in Lagos at the weekend by the NewsDirect Newspapers insisted that it is the real sector that can generate employment and inclusive growth.
Citing the position of analysts, Ajibola said the current hitches, which have brought the country to its current pitiable state were largely caused by overdependence on oil, profligacy and impunity.
He said a drop in oil prices had pounded the national currency of a few nations that are reliant on oil since last year.
“Oil is Nigeria’s primary export; little wonder naira is under pressure. Many central banks around the world, including the Central Bank of Nigeria weakened their own currencies, in part to stimulate export growth. Talking about stimulating export, Nigeria has little or nothing to stimulate. So, if Nigeria devalues its naira, import becomes costly,” Ajibola said.
“The Central Bank of Nigeria, has announced several policies on the control of the foreign exchange rate such as the ban on importation of 41 items, forex allocation, the immediate stoppage of foreign exchange supplies to Bureaux de Change, BDCs are now to source forex from the autonomous market and some other policies which were announced at the Monetary Policy Committee (MPC) Meeting in Abuja and also the increase in MPR rate.
These policies were aimed at defending the currency. However, in spite of the implementation of these policies, the exchange rate has continued to dwindle giving credence to the fact that we have very limited monetary policy options owing to the monolithic nature of our economy,” Ajibola explained.
Ajibola said the greatest undoing in this country was corruption, adding that corruption has eaten deep into the fabrics of our society.
According to him, more worrisome is that after 55 years of existence as a corporate entity called Nigeria, the country is still struggling with the definition of corruption and the question is being asked if mere stealing is corruption, stressing that this in itself is a big challenge.
He said the consequence of these corrupt practices can be seen on the exchange rate crisis the country is experiencing at the moment.
“Worst of all is the culture of impunity. An example that comes to mind is what we call plea bargaining. You steal 100 billion naira, you return 1 billion and all you get is “go and sin no more”… We salute the current government on their stance against corruption and we hope they win the battle,” he added.
According to him, policy makers must embark on concerted policy measures aimed at diversifying the economy away from reliance on hydrocarbons.
Ajibola said with the large expanse of arable farm land and water resources endowed on the country, the price of oil, whether it is high or low, should be inconsequential to Nigeria.
