TEXT OF SPEECH DELIVERED BY CHIEF NIYI AKINSIJU, CHAIRMAN, INDEPENDENT MEDIA & POLICY INITIATIVE (IMPI), AT A PRESS CONFERENCE ON SOCIAL, ECONOMIC AND POLITICAL DEVELOPMENTS IN NIGERIA IN THE FIRST FEW MONTHS OF 2024, HELD AT BASSAN PLAZA, ABUJA, ON MONDAY 29TH OF APRIL 2024.
Gentlemen of the Press,
It is our pleasure to engage you today with a summary of our observations and analysis on national developments in the first few months of year 2024.
You will recall that at our maiden press conference of 30th January, 2024, we justified the removal of petroleum subsidy by the present administration as a life saving measure for the Nigerian economy, as it grapples with sluggish growth, low revenue and rising public debt.
Similarly, in our policy statement 08 published on March 5, 2024 in which we evaluated the possible impact and estimated progress of the economic reforms being undertaken by the administration of President Bola Ahmed Tinubu, we posited that Nigeria by all possible evaluation metrics, is an economic giant waiting to take its position in the sun. This is despite the fact that it had remained stunted over the years because of policy misapplications, especially of such that emphasise today’s existence as against wealth creation premised on delayed gratification.
In all our public interventions, we have counselled the President Tinubu’s managed federal government to commit to seeing through its various reform-focused policy deployments across all segments of the nation’s social and economic spheres.
Painful as the decision by the Federal Government to remove petrol subsidy and the unification of the foreign exchange windows has been, the economy had responded positively by returning an impressive 3.4 percent growth in the nation’s Gross Domestic Product (GDP) in the 4th Quarter of 2023, as released by the National Bureau of Statistics (NBS) in February this year.
This confirms our earlier claims and projections that the economy was responding positively to the reforms of this administration. And that Nigerians will soon begin to reap the harvest of their sacrifice through affordable cost of living, food security, creation of a job creating economy, access to quality education, and affordable health and transport services.
Already, we have started witnessing the green shoots of the impact of the policy deployments on the economy. As envisioned in our maiden press conference regarding the paradigm shift in the commercial use of natural gas as part of the Federal Government’s strategies to mitigate the costly impact of the fuel subsidy removal on vulnerable Nigerians. We are delighted to note that the Compressed Natural Gas (CNG) powered transportation system has become a reality as promised by the president. Nigeria has now joined the group of nations with fleets of CNG vehicles, as all is now set for the launch and deployment of the first set of mass-transit CNG vehicles and tricycles across the 36 states of the Federation and FCT in May, 2024.
These eco-friendly vehicles will transport commuters at reduced cost, provide thousands of job opportunities for our youths, and improve the standard of living of the people.
In the immediate, we can submit that the federal government is growing stronger on opening up and truly liberalizing the Nigerian national economy from the fetters of the past. This has reflected in the market-determined movement of the Naira in the foreign exchange market, so much that though it spiraled up to a high of N1,900/$ on 21st February, 2024 at the parallel market but now, the same Naira/dollar exchange rate currently obtains at less than N1,200/$. Going forward, we can hazard a projection of less than N1000/$ projection between now and the end of the third quarter 2024. This implies that the Naira is now competing favourably with other world currencies and continues to affirm its place as one of the best performing currencies globally.
On the revenue side, the removal of fuel subsidy has become a financial elixir for the hitherto constricted revenue earning capabilities of the national economy. Nigerians are now witnesses to the monthly spectacle of Federation Accounts Allocation Committee’s (FAAC) sharing and savings never-before-earned revenue among the three tiers of government which has averaged N250bn monthly, thereby enhancing the Federal, States and Local Government Areas capacity to pay workers’ salaries and provide critical infrastructure.
While the economy is gaining much needed momentum in the enunciated areas as recorded in the first quarter of the year, we, however, observe with mixed feelings, rocketing food prices which continue to manifest in high headline inflation rate recorded at 33.2 percent, very much driven by a 40.01 percent food inflation rate in March.
Despite this disconcerting persistent increase in food prices, we must acknowledge the conscious efforts of President Bola Tinubu to rejig the economy and ensure food security through massive investment in agriculture. In this regard, we particularly commend the administration for funding the ongoing dry season cultivation of 120,000 hectares of farmland for the production of wheat.
This aggressive push to boost food production is a confirmation of the President’s seriousness on his declaration of State of Emergency on Food Security on 13th July 2023. To this end, we also commend the Jigawa state government for allocating 80,000 hectares of land to the Presidential initiative on wheat, and also thank the government of Kano and Kaduna states for making available the remaining 40,000 hectares that will make the exercise a tremendous success.
However, we are not happy and wish to publicly register our displeasure over the lackadaisical attitude of some state governors to the Presidential commitment to cultivate 500,000 hectares of land, to grow rice, cassava, maize, wheat, millet, and other staple crops across the country.
Recall that in our last engagement with you, we posited that the cultivation of 500,000 hectares will among other things, boost food production and supply, force down the high prices of foodstuffs in the market, and ensure food security in the country. Unfortunately, our investigation showed that many state governments are yet to make available their own portion of farm lands for the exercise. Therefore, we call on all the state governments that are yet to provide farmlands for the programme to do so, as quickly as possible, because time is of the essence as the country is in dire need of massive food production at this crucial moment.
Meanwhile, the first quarter of the year has witnessed commendable strides in the oil and gas sector. These include the domiciling of Nigeria National Petroleum Corporation Limited (NNPCL) revenue account with the Central Bank of Nigeria (CBN), which has facilitated a truly single treasury account platform for the country’s oil earnings.
In addition, in a continued upward trajectory witnessed in oil and gas exploration activities, oil rig count, an index with which upstream activities are measured, surged by 23 percent year-on-year (YoY) to 16 rigs in February 2024. The increased rigs activities have resulted in higher crude oil production inclusive of condensates averaging 1.65 million barrels a day as per last quarter.
While this has positive prospects for accretion to our foreign reserve, we estimate that crude oil production should increase to 1.8 million barrels a day, which is more than the 1.78 million crude oil production target projected in the 2024 federal budget, by the end of the second quarter of 2024.
Also connected to the oil and gas sector is the directive by President Bola Ahmed Tinubu to the Attorney-General of the Federation (AGF), the Economic and Financial Crimes Commission (EFCC), and other relevant organizations, to amicably resolve the $1.3 billion OML 245, Malabu Oil saga. We hereby enjoin the Attorney-General of the Federation and other relevant agencies to speedily bring closure to the saga so as to avail the country a veritable source of oil production and by extension increased foreign exchange earnings.
Gentlemen of the press, we note that the current developments in the downstream oil sector are pleasant. The commencement of production by Dangote Refinery which has led to the reduction in the pump price of diesel and aviation fuel, and the anticipated production of refined products by both Port Harcourt and Warri refineries underscores the healthy competition that will ultimately lead to further reduction of pump prices of fuel and other petroleum products, as well as conserve foreign exchange for the country.
In the sphere of education and access to education, we are particularly excited with the evolving policy position of the federal government as an answer to the immigration of professionally trained Nigerian young people out of the country in the “japa” syndrome. The President has made good his commitment to ensuring that no qualified Nigerian is denied access to higher education and vocational studies by signing into law the bill establishing the Nigeria Education Loan Fund (NELFUND). The extension to this is that the Federal Ministry of Education has announced a policy to increase admission spaces for critical academic and professional courses in tertiary educational institutions that are in high demand domestically and internationally.
This policy will bridge domestic gaps created by the egression of trained academics and professionals. We envisage that when this policy implementation is fully evolved, Nigeria may be a net exporter of skilled manpower to the world with positive implications for diaspora remittances and technology transfer.
As we earnestly await the commencement of the implementation of the capital component of the 2024 Fiscal Budget slated for the second quarter of the year, the milestone achieved in the configuration of the budget strikes a chord in our evaluation of national development in the first quarter of this year, being the first time in 24 years, that the Capital Expenditure of the national budget will exceed the ever increasing Recurrent component. This is a landmark achievement under the Tinubu administration. It then implies that the federal budget of 2024 will impact more on the country’s infrastructural development if well implemented.
Accordingly, we urge His Excellency, President Bola Ahmed Tinubu, GCFR, to further tighten the hangman’s noose on all tendencies of indiscipline, corruption and internal sabotage in government, so that the capital component of the 2024 Fiscal Budget would be successfully implemented without encumbrances. This higher ratio of capital budget to recurrent budget is the precursor to the projected huge infrastructure spending conceptualized in the Renewed Hope Infrastructure Development Fund (RHIDF) and the strategic, all inclusive Presidential Economic Coordinating Council (PECC).
On the security front, we acknowledge the efforts and sacrifices of members of the armed forces and security personnel in the battle against terrorism, banditry, and kidnapping. The revelation from the Chief of Defense Staff (CDS), General Chris Gwabin Musa that 974 terrorists including numerous Boko Haram/ISWAP Commanders, and notorious bandit kingpins, were killed by troops in February alone showcase the intensity of actions deployed by the President to address matters of insecurity. Similarly, it amplifies the capability and readiness of our gallant men and women to protect and maintain peace and security in Nigeria. We appreciate their efforts and pray that their sacrifices for the nation shall never be in vain.
Related to this, we pay tribute to the officers and men of the Nigerian Army who were gruesomely murdered recently at Okuama village in Delta State while on official duty. We condemn the dastardly act in the strongest term and welcome the Commander-in-Chief’s directive to the military to find the heartless perpetrators of the heinous crime. We pray that God repose their souls and grant their families the fortitude to bear the loss.
Still on security, we commend the President and the security services for the successful rescue of 137 school children that were abducted on the 7th of March in the Chikun Local Government Area of Kaduna State. And we also call for more actions to rescue all other school children that may have been forcefully abducted by terrorists, bandits, and kidnappers in the country.
We, however, admonish state governments on their part to refrain from acts that are capable of jeopardizing the ongoing efforts by President Tinubu to secure the nation. As Chief Security Officers in their respective states, it will be counter- productive for governors to act at variance with the President on matters of national security and associated policies.
The unprecedented high confidence of foreign investors and Diaspora Nigerians in the economy is yet another remarkable outcome of the Tinubu reforms. Between January and March 2024 alone, a whopping sum of $3.6 billion was recorded as foreign capital inflow into the country, almost equaling the annual record of the year 2023. This means that an exceedingly high foreign capital inflow into the economy for the year 2024 is progressively inevitable.
It is also to the credit of the ongoing economic reforms that the President commissioned Africa’s largest Tomato Processing Plant in Kebbi State recently. The plant is equipped to process 2,400 metric tonnes of tomato per day. This particular development rebuts the views of critics who described the ongoing economic reforms as “hostile to investors”, due to the recent exit of some companies from the country. Critics of these economic reforms must understand that the emerging economy of Nigeria is open market driven, where only genuine investors that are willing to compete under the dictates of transparent market forces can succeed.
As this new economic paradigm evolves, the challenges associated with it are the equivalence of the early pangs of child birth, which manifest in high cost of living in the country. Yet, it is our expectations that the end result of President Tinubu’s economic reforms will improve our social protection system and enthrone an excellent public financial order that will anchor multidimensional opportunities for economic prosperity.
The fourth quarter of 2023 saw some powerful economies of Europe on the verge of recession, while Nigeria’s GDP returned a healthy 3.46 per cent and Nigeria’s stock market crossing 100,000 basis points. Capital importation increased by 66 percent, with February alone witnessing a capital inflow of over $1 billion, and fuel importation drastically declined by 50 per cent. And with the merger of duplicated and redundant departments and agencies of government under the ongoing implementation of Oronsanye Report, we expect more funds to be freed and channeled into capital expenditure to improve the nation’s historical infrastructural deficit.
This brightness in Nigeria’s economic horizon should serve as an encouragement to the Tinubu administration to stay the course, and resist any temptation or pressure to reverse its policies on petrol subsidy removal and the floatation of the Naira.
In response to critics who are of the view that the Peoples’ Democratic Party (PDP) made several gains in the economy from 1999 to 2015, we did a comparative analysis and cost quantification of the PDP economy during the corrupt petroleum subsidy regime, and the present petrol-subsidy free economy of President Bola Ahmed Tinubu.
Our findings indicated that the Tinubu economy saves an average of N1 trillion monthly from the withdrawal of petrol-subsidy in June 2023, while the three PDP regimes recorded a monthly loss from petrol-subsidy of N1 trillion over a period of 16 years, amounting to a total of N192 trillion. Little surprise, therefore, that Nigeria ranks among nations with the worst record of infrastructural deficit in the world.
The presidential embargo on foreign trips by government officials further confirms the passion and seriousness of President Bola Tinubu to reduce the cost of governance in the country. The President’s action is ensuring prudence and discipline in the federal government’s spending, particularly now that the implementation of the capital expenditure component of the 2024 budget has commenced.
We therefore call on the sub-nationals to emulate the President in curbing wastages in their financial expenditures, so that meaningful development can be adequately delivered to Nigerians at the grassroots especially now that there is an increased allocation from FAAC.
The Government has taken the economy a notch higher with the introduction of the Consumer Credit Scheme known as The Nigerian Consumer Credit Corporation (CrediCorp) which has the potentials to improve consumption capacity for Nigerians, resulting in expanded productive capacity for the manufacturing sector. This implies that you do not need to wait until you have saved so much to purchase what you desire.
The establishment of the Credit Scheme and the extension of payment of Social Security to NCE graduates upward, with a commitment of N100bn by the President, and the approval of Social Security Unemployment Programme to alleviate economic difficulties for unemployed youths, are part of the actions and decisions of the Tinubu administration within the first quarter of the year, which we consider to be courageous, timely and commendable.
We therefore call on the media to sensitize and encourage our citizens across the federation to register for BVN and NIN to enable them to benefit from government’s social security programmes.
In addition to sensitizing vulnerable citizens on the conditions to access social security payment scheme, it is also important to advise government on the urgent need to rejig its cash transfer programmes for the purpose of effectiveness, transparency and accountability.
The commendable decision by the President to grant approval for the establishment of Renewed Hope Infrastructure Development Fund (RHIDF) to bridge the nation’s infrastructural gap, has opened a new vista in the general expectation of the benefits of petroleum subsidy removal. We note with great interest, the potential sources of funding targeted by the RHIDF to raise N20tn (about $14bn) for its take-off grant, and we strongly suggest that a significant percentage of the savings from the withdrawal of subsidy be made available to RHIDF for the development of infrastructures across the nation.
Furthermore, we submit that it is important for the federal government to erect permanent signposts at the site of every infrastructural project that is accomplished with savings from petroleum subsidy withdrawal, so that Nigerians will appreciate the positive impact of the withdrawal of subsidy, and be happy that their sacrifices are not in vain.
It is in the light of the forgoing suggestions, that we urge the President to lay emphasis on the process of monitoring and compliance enforcement in the implementation of all infrastructural projects across the country to ensure that all projects are completed to time and specifications.
The suspension of the seemingly controversial implementation of the Expatriate Employment Levy (EEL) by the President is a testimony of his enormous capacity to tolerate opposing views in the management of state affairs. This attribute of opposite views tolerance is a key supplement in any democratic leadership. Deriving from this, it is our considered opinion that President Tinubu has continued to demonstrate maturity and brinkmanship in the manner he his handling volatile political and other forms of crisis in the country to the delight of national stability.
His timely intervention in the inter and intra party crises in Kano, Rivers and Ondo States, have brought relative peace and stability to the functioning of governments in the affected states, and we believe that the President deserves to be commended for this expression of statesmanship.
On this happy note, we urge the President to continue in his giant stride of reengineering Nigeria’s economic structure because it is the only way our dear nation can realize its full potential as a 21st century super power, and the pride of the black race.
We find it incumbent to express our deep concern over the attitude of some public office holders who are fond of using their privileged positions to undermine the rule of law and the ongoing anti-corruption crusade. This is with particular reference to the recent stand-off between the former governor of Kogi state Alhaji Yahaya Bello and the EFCC.
It is distasteful that elected public officers who are expected to be custodians of the law are displaying attitudes that are inimical to the rule of law and democracy. We, therefore, totally align ourselves with the position of the Chief Law Officer and Attorney General of the Federation on the matter. For us, the momentum created by the anti-corruption policy of the Tinubu administration should be sustained as we believe it is a non – partisan crusade against corruption.
Finally, we consider the unnecessary controversy over the ongoing construction of the 700km Lagos-Calabar Coastal Highway as a distraction to the lofty ideas of the President Bola Ahmed Tinubu Administration to open up the economic potentials of Nigeria’s coastal belt. We therefore condemn the controversy thrown up in some segments of the society and urge all stakeholders in the project to pay no attention to attempts by unscrupulous elements to discredit the project.
We thank you, gentlemen, of the press for your valuable time. We hope to see you again by the end of the second quarter of 2024.
Thank you.
