Nigeria is facing a national economic disaster – Pat Utomi

By Post Nigeria February 8, 2016 19:23

Nigeria is facing a national economic disaster – Pat Utomi

The possibility of the Nigerian economy plunging into recession in 2016 is not in doubt, going by the poor economic policy direction of President Muhammadu Buhari. Professor Pat Utomi has maintained.

As crude oil prices dive lower, threatening to dip below $30 a barrel for the first time since the financial crisis of 2008, commodity economies around the world are catching a cold.

The collapse of oil price is already taking its toll on the Nigerian economy. As it stands, there is no light at the end of the tunnel yet. Nigeria’s situation is further worsened by the current government’s delay in enacting sound fiscal and monetary policies.

Investors across the world are losing their investments in stock and property owners are also suffering losses as a result of depreciation in currencies.

The Naira is currently under intense pressure, the situation has depleted Nigeria’s foreign exchange reserves, with policy makers now left with a difficult decision to make: either allow the currency to move in a wider range against the dollar or raise interest rates.

However, the Governor of the Central Bank of Nigeria, CBN, Godwin Emefiele has promised to stabilize the Naira without devaluing the currency.

President Muhammadu Buhari has also backed the CBN’s monetary policies, which have raised questions about its sustainability.

Two former Central bank governors, have disapproved the current policies initiated under Buhari, aimed at amelioration the situation. They have both called for more flexibility in the management of the country’s currency.

Related: Sanusi criticises Buhari’s Forex policies

The lack of apparent policy direction of the present government has left a lot of decisions hanging. Investors are playing the waiting game, some have pulled out their funds in the capital and bond markets.

Related: 2016 Budget is a failure – Soludo

Reacting to the huge challenge facing the Nigerian economy, Utomi affirmed that the economy was currently under severe distress. And demanded that the federal government initiates policies that would prevent the economy from a total collapse.

The former Presidential candidate and professor of political economy expressed his concern via his twitter handle, calling on all well meaning Nigerians to speak against the current trend in the economy.