RECESSION: Presidency Says Nigerians Paying For Jonathan’s Recklessness, Corruption

The presidency in Nigeria says it will not close its eyes to what it calls
the poor performance of the past administration so as not to repeat their
mistakes.

A statement by a spokesman for President Muhammadu Buhari, Mr Garuba
Shehu, said the economy was broken by the Goodluck Jonathan administration
and that Nigerians must bear the pains of fixing it.

The Friday’s statement is coming few days after it became official that
the oil-rich nation’s economy has glided into recession.

According to Mr Shehu, the past administration engaged in mismanagement
and corruption rather than investing in infrastructure development like
seaports, airports, power plants, railways roads and housing, when oil
price was $140 per barrel.

He also observed that no savings were made by the past administration
unlike other countries like Qatar, Saudi Arabia and Norway.

Other factors which he named that had contributed to the nature of the
economy, include heavy borrowing by the past administration, issues he
stressed that past governors of the Central Bank warned the government
about but were ignored.

He further stated that the past administration could not investigate the
military spending, the federal payroll which had over 40,000 ghost
workers, wasteful expenses like first class travel and private jets for
official trips.

The President’s spokesman said the present administration was focusing on
job creation using agriculture, solid minerals and manufacturing which
were abandoned when oil price was $140 per barrel.

“To compound the problem, the previous government was borrowing heavily
and owed contractors, and international oil companies. When this
government took over we had accumulated debt back to the level it was
before the Paris Club Debt Forgiveness,” the statement further read.

Mr Shehu said: “Now that the oil has fallen as low as US$28 per barrel, it
is very difficult to do what is needed but they must be done to save
Nigeria. There is no other way if we want to be honest”.

He claimed that while terrorism and social unrest were growing, real
development was lacking.

The spokesman for the President further promised that Nigeria would return
to growth in a sustainable manner and expressed optimism that the positive
impact of the work of the Buhari administration would soon begin to show.

Read full statement below

WHAT IS PRESIDENT BUHARI DOING WITH THE ECONOMY?

Garba Shehu, Senior Special Assistant to the President (Media and Publicity)

LET me start by asking an important question: who wants to kill racy
introspection?

There is a cacophony of voices telling the Muhammadu Buhari administration
to close its eyes to the past; that given the enormous tasks that lie
ahead, history and its consequences for our nation should be the least of
the government’s preoccupation at this juncture.

I disagree. Let us keep a fiery memory of the past so that we don’t repeat
its mistakes. Look back, look ahead. The future must of necessity be built
on the foundations of the past.

The Conservative Party took power in Britain six years ago from Labour.
Check the British press, they are talking about Labour 24/7, is anyone
complaining?

Japheth Omojuwa, one of Nigeria’s top three influencers seemed tasked in
his patience reacting to calls that we must stop talking about the
immediate past administration in this country. “People are still talking
about who ran governments in 1865 you want us to forget those who left
government last year? (Expletive)”

Music icon, Fela Anikulapo Kuti, who many agree was a philosopher
disguised as Afro-musician taught in one of his songs that without knowing
where you are coming from, you won’t know where you are going. Wise men
say that the empty can doesn’t disappear by simply kicking it down the
road.

To avoid repeating the past mistakes, Nigerians must come to terms with
what went wrong with the past, how bad were things, what was done wrongly,
what the past government should have done, before we come to what needs to
be done to right those wrongs. Believe me, episodes from the Jonathan era
can fill books, and other possibilities such as courtroom drama thriller.

Against this backdrop, I sought to hear our erudite Finance Minister Kemi
Adeosun on where we are coming from, vis-a-vis the administration’s chosen
path to recovery and accelerated growth. What is the administration doing
to revitalize the economy? She spoke at length on the many measures being
put in place, many of which are not glamorous. They of necessity come with
pain. Why should Nigerians be asked to endure pains? Why should they be
asked to make adjustments?

The simple explanation is that the economy was broken, and just as they do
the broken leg, you must bear the pain of fixing it. The current situation
was caused by years of mismanagement and corruption.

As explained by President Buhari again and again, trumpeted by Madam
Adeosun and other senior officials, we solely relied on oil, the price of
which was as high as US$140 per barrel. Government simply reticulated oil
revenue through personal spending by corrupt leaders, wasteful expenses
and salaries. This was done rather than investing in what would grow the
economy. Economies grow due to capital investment in assets like seaports,
airports, power plants, railways, roads and housing. Nigeria has not
recorded a single major infrastructural project in the last 10 years. In
short the money was mismanaged.

In addition to failing to spend money on what was needed, no savings were
made by Government unlike other countries like Qatar, Saudi Arabia and
Norway.

To compound the problem, the previous government was borrowing heavily and
owed contractors, and international oil companies. When this government
took over we had accumulated debt back to the level it was before the
Paris Club Debt Forgiveness.

All these factors were building up to Nigeria heading for a major crisis
if the price of oil fell. Nigeria did not have fiscal buffers to withstand
an oil shock.

The oil shock should and could have been foreseen. These are matters that
both the Emir of Kano, Muhammadu Sanusi II and Professor Chukwuma Soludo,
both of them eminent former Central Bank Governors had occasions to warn
the government of the day about, but they were clobbered. The dire warning
was written all over the wall, but they were ignored by Nigeria’s economic
managers.
What should they have done?

They should have had the courage and vision to do as the present
administration is doing through the Economic Team, the Ministry of Finance
under Madam Adeosun and the various agencies of the state to envision a
better future by first of all fighting corruption. Look at what a civilian
administration is today doing to the military, investigating their finance
and accounts that the military could not do to themselves.

See what the current administration is doing sanitize the huge salary bill
by eliminating payroll fraud. So far, the federal payroll has been rid of
about 40,000 ghost workers. More than eight billion Naira stolen monthly
has been saved.
We are also saving on wasteful expenses like First Class Travel and
Private jets for official trips.

The federal government is not limiting the reforms to the centre but
forcing State Governments to reform their spending and build savings or
investments.

Government is also increasing spending on capital projects especially on
infrastructure needed to make Nigerian businesses competitive and create
jobs. The administration is at the same time blocking leakages that
allowed government revenues to be siphoned into private hands.

Currently, there is focus on key sectors (apart from oil) that can create
jobs and or generate revenue such as Agriculture, Solid Minerals and
Manufacturing. If these things had been done when the oil price was as
high as US$140 per barrel, Nigeria would not be in the current
predicament. We would not be suffering now if we had no cash reserves but
we had regular supply of power, a good rail system, good roads and good
housing.

Now that the oil has fallen as low as US$28 per barrel, it is very
difficult to do what is needed but they must be done to save Nigeria.
There is no other way if we want to be honest.

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