Nigerian Economy: Senate Summons Finance Minister, CBN Gov

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Senator-bukola-saraki
Senate President, Bukola Saraki
2016 Hot Business Ideas

THE Senate, on Wednesday, summoned the Minister of Finance, Mrs Kemi Adeosun and the Governor of Central Bank of Nigeria (CBN), Mr Godwin Emefiele, over what they called the dire state of Nigerian economy.

The lawmakers, who adopted a motion by Senator Bassey Akpan, said the duo of Adeosun and Emefiele must appear before the chamber to give details of the economic policies of the government and the plan to turn around the situation.

Senator Bassey told the Senate that Nigeria’s economic scorecard recently released by the National Bureau of Statistics (NBS) showed that the economy had relapsed into a recession with a decline of 0.3 per cent year-on-year real terms, adding that the report showed a drastic drop from 2.11 per cent in the gross domestic product (GDP) of the fourth quarter of 2015.

He also said the Senate needed to know the monetary and fiscal policies put in place to turn around the comatose economy.

Senator Akpan, in his motion, entitled: “an urgent need to address the present economic state of the nation,” stated that unemployment rate rose from 10.4 per cent in the fourth quarter of 2015 to 12.1 per cent in the first quarter of 2016, while under employment also rose from 18.7 per cent in the same period to 19.1 per cent.

He added that inflation rose from 9.6 per cent in January 2016 to 13.8 per cent in April 2016, while prices of commodities had continued to be on a geometric rise.

The lawmaker explained that besides the high inflation rate, the declining GDP and rising unemployment rate, there were also indices of unfruitful economic policies which, he said, required urgent review if the government wanted to avert further economic recession.

The senator also argued that the current economic situation was the first major crisis of the Nigerian economy since 2004 which, he said, the CBN classified as 12-year low while the World Bank called it 21-year low.

According to him, the CBN had, in March 2016, deployed a contracting monetary policy which he believed increased the benchmark for interest rate from 11 per cent to 12 per cent and also raised the cash reserve ratio from 20 per cent to 22.5 per cent as he queried the rationale behind contracting monetary policy instead of expanding it to boost economic activities at such a precarious times like this.

He also told his colleagues that if the persistent complacent state of the Nigerian economy continued unchecked, it would graduate into a full blown economic recession at the end of June 201,6 in accordance with CBN alert, adding that non-availability of foreign exchange to boost the importation of raw materials for Nigeria’s domestic industries would only worsen the current unemployment and poverty rates in the country.

Senate President, Dr Bukola Saraki, who presided over the sitting on Wednesday, had to disallow debates on the motion to calm the growing tension among senators of the All Progressives Congress (APC) and opposition Peoples Democratic Party (PDP) over the issue.

Senator Biodun Olujinmi, who seconded the motion, also told the Senate that the incumbent government had not introduced any fruitful economic policy.

She said many things were wrong with the economy, adding that the duo of Adeosun and Emefiele must not just appear before the Senate, but they must also unfold the government’s economic policy.

Rather than allow debate on the motion, Saraki merely called for voice votes and the motion was adopted by the lawmakers.

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