Nigerians foresee economic recovery as new ministers assume duty

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AFTER nearly six months of near economic paraly­sis, with noticeable investor apathy and debilitating cash crunch, Nigerians yesterday expressed optimism that the nation’s economy will soon bounce back to life with the inauguration of the Federal Executive Council by Presi­dent Muhammadu Buhari.

Hopes were high that part of the huge debts owed con­tractors would be released while other capital projects in various states will get some funding that will relax the strains in sectors of the economy.

Buhari, had Wednesday named Mrs. Kemi Adeosun as new Finance Minister who is expected to lead his economic team comprising experienced technocrats and politicians like Udoma Udo Udoma (Budget and Na­tional Planning); Babatunde Fashola (Power, Works and Housing); Rotimi Amaechi (Transport); Okechukwu Enelama (Industry, Trade and Investment); Kayode Fayemi (Solid Minerals); Ibe Kachikwu (Petroleum Resources); Audu Ogbe (Agriculture and Rural De­velopment) and Adebayo Shittu (Communications) urging them to resuscitate the ailing economy and de­liver on his party’s electoral promises.

Their optimism is coming against the background that Nigerian public sector re­mains the largest spender in the economy.

Since the crash in the glob­al prices of crude oil in June of 2014 and its attendant dwindling incomes to Nige­ria, many analysts have noted that for the Buhari’s govern­ment to make any meaning­ful impact on the economy in the next four years, Adeosun and her team would have an Herculean task of diversify­ing the economy away from its many years of overdepen­dence on crude oil sales. For instance, recent data from the National Bureau of Statistics had indicated that Nigeria’s GDP responded to the world oil price slide with the sec­ond quarter (Q2) dipping by 1.61 per cent.

Agriculture, solid miner­als, aviation, marine, and real sectors under the new divest­ment plan are expected to be rejigged with greater invest­ments from both public and private sector flowing in.

President of the Manufac­turers Association of Nigeria (MAN), Dr. Frank Jakobs, specifically said agriculture and solid minerals should be designated as key areas of fo­cus by the new ministers as alternative sources of income given the declining revenue from the oil sector.

“The falling oil price glob­ally calls for the diversifica­tion of the economy of the nation. The fall of oil prices means revenue available to the government will be minimal to the extent that the country can no longer meet its obligation to the citizens. Above all, we must look at the industries that derive their materials locally,” Ja­kobs noted.

Also commenting, Presi­dent, Association of Li­cenced Telecommunications Operators of Nigeria (AL­TON), Mr. Gbenga Ade­bayo, told Daily Sun that with the swearing in of new ministers, the dormancy, which has characterised the economy will fade away as fresh investments will be­gin to flow in as policies are enunciated and implemented by the cabinet ministers.

“Certainly, things will pick up in the economy. It could be slow, but then right­ly, and I know that we will be heading in the right direc­tion,” said Adebayo.

He, however, urged the ministers to engage stake­holders more often and not seek to run a monopoly in their respective ministries and build on the successes of their predecessors.

Similarly, President of the Association of Telecommu­nications Companies of Ni­geria (ATCON), Mr. Lanre Ajayi, also noted that, “the communications sector will pick up slowly and grow stronger and meaningfully impact the economy.”

“The new Communica­tions Minister, Mr. Adebayo Shittu, will however need to implement the broadband plan, which will make in­ternet access available and affordable to all Nigerians,” said Ajayi.

Meanwhile, President of Nigerian Air Traffic Control­lers Association (NATCO), Mr. Victor Eyaru, was de­lighted with the naming of ministers for the various sec­tors.

He, however, demanded that in some key aviation parastatals like the Nige­rian Air Space Management Agency (NAMA), the min­ister should slash the over nine directorates to just three to save cost and ensure effi­ciency in service delivery.

Stable power supply re­mains a critical element for investments, that will be coming in and assisting in growing the economy. Op­erating with a paltry 3,800 megawatts capacity in an economy of 170 million people leaves much to be desired. Stakeholders in the power sector were obviously elated that the President has finally appointed former La­gos State Governor, Mr. Raji Fashola, as Power, Works and Housing Minister.

According to the Manag­ing Director, Ikeja Electric, Mr. Abiodun Ajifowobaje, government must do all it can to protect power infra­structure assets from constant attacks by vandals while en­suring that gas is delivered to power plants to ensure steady electricity supply.

On the capital market, Managing Director of Cowry Asset Investment Company, a stockbroking firm, Mr. Johnson Chukwu, believes that the inauguration of President Muhammadu Buhari’s cabinet may not have immediate effect on the equities market.

This, according to him, was because market operators have already grown weary of waiting and would now respond only to positive policy pronouncements. Such pronouncements may, however, take some time to come as the Ministers will first understudy their ministries before evolving policies that would be appropriate to address the challenges of each individual ministry. It is only when positive announcements on the economic and policy direction of the government are made that the capital market will respond in similar direction.

Source: Daily Sun