Former vice president and Peoples Democratic Party (PDP) presidential hopeful, Atiku Abubakar said yesterday that unless the federal government’s current policy of ‘uncontrolled spending spree’, the country risks going broke sooner than envisaged.
Mr Abubakar, in a statement from his campaign group in Abuja, said he had often alerted the presidency on the state of the economy but regretted that rather than taking his warnings seriously, the Goodluck Jonathan administration continued to pretend that the situation is not dire.
“But rather than take heed of the alerts, the Jonathan administration has continued to play the ostrich and live in denial of the true state of the Nigerian economy.” He added the managing director of the World Bank, Ngozi Okonjo-Iweala, the former Governor of Central Bank of Nigeria, Chukwuma Soludo and the Brettonwood institutions, have also urged urgent interventions to stem the slide of the economy.
The presidential aspirant also added that the Minister of Finance, Olusegun Aganga and the Governor of the Central Bank of Nigeria, Lamido Sanusi Lamido have acknowledged that indeed all is not well with the nation’s economy with their recent utterances on government expenditure.
Aganga and animal farm
Mr Abubakar noted that with inflation currently at 14% in Nigeria compared to the BRIC countries’ (Brazil, Russia, India, and China) 7-8% and sub-Saharan Africa’s 7%, “Nigeria may not attain the 2020 target of being one of the leading 20 economies.” According to him, the current situation is also being exacerbated by the rapid depletion of the external reserves with not much to show for it in terms of infrastructure and economic development. He dismissed Mr Aganga’s claim that Nigeria is currently one of the top 10 economies of the world. The former Vice-President who presided over the nation’s economic council stated that Mr Aganga’s claim is reminiscent of George Orwell’s Animal Farm which presumed economic growth is only visible from pronouncements of government officials.


He said that in the first eight months of this year alone, the foreign reserves have decreased by $8 billion with its attendant impact on rising inflation, adding that the CBN’s intervention in raising the MRR (minimum rediscount rate) by 25 basis points has not helped the situation. He said since rates were raised, another $2.7 billion have gone from the reserves.

Mr Abubakar lamented that what is most worrisome is the depletion of the Excess Crude Account from $22 billion to $470 million with no corresponding projects associated with the spending just as he regretted that most of the expenditure has gone into recurrent spending.

He argued that the fact that the Jonathan administration is relapsing into the habit of foreign borrowing is a clear indication that something is wrong with the way the economy is being run. He also said as desirable as borrowing is to the development of the economy, the funds so borrowed must be targeted at critical sectors, else the nation will be returning to a regime of debt overhang.

Culled from 234Next