4Play:


If you believe the NBS's stats, Nigeria went into recession in 2016. Not in the second half of 2014 when much of the oil price collapse happened or in 2015. I know there was a further temporary dip in oil prices in 2016 but there were other issues affecting economic confidence such as the fixed exchange rate regime and the lack of liberalisation policies (privatisation and deregulation) to attract foreign investment which could have partly offset a transitory dip in oil prices by lifting economic confidence and attracting forex inflows.

A significant fall in oil prices shouldn't necessarily lead to recession if we had allowed the currency to depreciate instead of maintaining multiple exchange rates which led to forex scarcity. The economy was bound to slow down significantly but it wasn't bound to experience contraction in output.

I suppose your point is that Buhari is no more to blame than other Nigerian presidents who have maintained a suite of policies that have led to dependency on oil. But a president who fails to change direction in response to a fall in that commodity his nation depends on, who actually increases that dependency by insisting on maintaining an unrealistically high exchange rate value bears a great deal of responsibility for the collapse in business confidence and contraction in economic output that results.

kikero:


1.Buhari did not cause this current recession or the one that happened on his watch in 1983-5

2.The recession that happened under Buhari in 1983-5 started when oil prices fell in 1982...which even prompted Shagari to bring in austerity programmes by 1983.

3.Likewise the recession under this current admin started in April 2014...when oil prices collapsed due to the Saudis trying to outproduce American shale oil producers. By January 2015...NOI was warning that whoever won the election, there would be economic crisis.

4.The truth is, our economy has been vulnerable since independence. The economy depends on revenues from whatever raw materials we sell , whose prices we do not control. In the 1960's it was agricultural produce. By the 1980's, oil was taking over.

5.Where Buhari and others make mistakes is that they spend too much controlling prices on vital sectors like petrol and power. This limits the amount of investment that can be poured into both sectors, leading to job lossess and financial losses...especially from subsides which is money down a bottomless pit.

6.Because of our large population, we need oil at $139 per barrel and above, since 2017, up from $120 per barrel since 2012....to run a balanced budget.(despite our cost of production being below 30 dollars). Since 2010...we haven't had oil prices that high. That's why we are taking debts via borrowing...the money we are earning is not enough and has never been enough for our needs.

Oil is at $25. We need it at $140. We are losing at least $115 now per barrel of oil sold. (More information on my figures here)

Also due to the low oil prices, we are losing an average of $35.76million or N13.1 billion per day in accruable revenue

7. The way froward eventually...remove subsides , allow power and petrol to be run at a profit....which brings in investment and jobs. We did this for the GSM sector. Why can't we do this for power, petrol?? To long term help us transition into a producer economy...which produces goods whose prices we can control.

Modified

To anyone who thinks I am defending the current administration, see my points 5 and 7 and reflect on them. Also look at point number 6 and them make the assumption....we need to change our economic paradigm.

There is nothing to defend about this APC government. It is obvious they have failed. However, my problem with most critics of this administration is that they criticse the effects...they don't think about the cause of the effects. If we can think about the cause of the effects, we may be on the way out of this economic crisis.

The problem is, the solution involves some hard decisions. Removing subsides...and so on. The problem also is, APC, like PDP exisits to share the national cake, not to think about how the cake is baked, or how we assemble the ingredients.

Asquare84:
But I thought the value of a currency increase during higher demand, now there is Corona virus nobody travel or import anything from American how come the demand for dollars keep increasing. Let someone explain this

Japhet31:



I refrained from insulting you. I decided to believe your conclusion was not randomly reached. I just don't think they're correct is all.

The US generally doesn't like too much strength in it's currency as it discourages local production in America and encourages the exportation/outsourcing of jobs. It's in fact one of the reasons Trump repeatedly berates China's Xi Jimpin(not too sure if the spelling) and accuses the latter of currency devaluation.

So yes ..the USD is the world's reserve currency...but allowing it to strengthen without concordant economic realities will not do the US too much good either.

If you ask me ..I think the fact the US just lowered their interest rates....along with massive funds Trump's government has promised to inject into the economy are amongst the chief reasons for the dollar upside.

Had we not been operating a shadow economy ourself, these recent announcements of Corona donations by banks and governments should have stimulated our economy into some recovery too but ...

Our presidential team seems embroiled in putting out too many fires at the moment ...and we don't know who's leading the country at the moment. All these uncertainties only make Investors want to liquidate. Thus leading to our current predicament. They will soon start banning some items from being imported now... That's one thing Emefiele seems to be good at doing.

engrsyer:
This country is trying to make our little salary to be worthless than tissue paper.

Tufiakwa


Mono-economy country would always turn out to be like this

Seetto:

So if buhari was not the president, they wouldn't have been Corona virus or the price of crude wouldn't have fallen to 28$ per barrel in 2015, guy you are not toddler, Nigeria is in big shiit, the country is a shadow of itself, our leaders failed us, look at pdp regime, they have all it takes to improve the economy, but stealing and looting becomes order of the day, now crude is useless where do we start from with all these challenges the country is facing.

vickydevoka:
Whether de doller na 500 naira. A provisional store seller will still sell things for 5 naira profit.#pathetic

GamalNasser:
El Buhari

kikero:


Buhari has always had the tools to get us out of recession, but he and his guys won't use them because it involves things getting worse before they get better, and it impedes their ability to share the national cake.

topsquino:
Nawa oo.

NAIRA don over humble.

I'm giving a giveaway of 1 million naira to 70 LUCKY WINNERS here on Nairaland by 6pm.

If you are interested, check my post today by 6pm.

Make I donate my own contributions

DModeCntStopMe:


Suicide might be his only way out

etrouble:


This hatred and bitterness that your parents planted in you is the reason why you are sad, miserable and depressed. I support Buhari. The idiots and sophisticated morons you mentioned up there are your parents.

Goatluck Jonathan, Diezani Alison-Madueke and that World Bank Fraudster Ngozi Okonjo-Iwealla ran the country into recession the other time and you and your family into depression and suicide.

Currently, there is World Economy Meltdown due to Corona Virus pandemic and Nigeria isn't an exception.

If not Buhari that forced Nigeria to produce Rice by closing borders, by now that Rice is now coming from Asia due to Corona, you would have
been eating Sand.

jidxin:
simple thing u dont understand. Its parallel market. Its bureau de change. It wont affect the economy. because d world market is unstable CBN no longer gives them dollars

OTayobami:


Oga haba now! You know how wealth distribution in Nigeria is and you're talking about total removal of subsidies from fuel, the simple thing is that, in saner country(countries with humans being as leaders and not animals) the reserves from the economy boom in 1970 would have been used to cushion these recent recession et' al

vickydevoka:
Whether de doller na 500 naira. A provisional store seller will still sell things for 5 naira profit.#pathetic

Seetto:

So if buhari was not the president, they wouldn't have been Corona virus or the price of crude wouldn't have fallen to 28$ per barrel in 2015, guy you are not toddler, Nigeria is in big shiit, the country is a shadow of itself, our leaders failed us, look at pdp regime, they have all it takes to improve the economy, but stealing and looting becomes order of the day, now crude is useless where do we start from with all these challenges the country is facing.

tomakint:
Buhari had the singular honour of bringing Nigeria into multiple strings of economic recession. The truth is under this useles government of no direction and proudly supported by useful idiots and sophisticated morons, Nigeria had never exited recession. This is the truth.

Mizwisdom:




You don't need to insult but state facts if you have anything to offer.

World economy is in recession, America is affected but dollar remains stable, go figure.

https://www.nairaland.com/5760174/imf-global-economy-recession-worse

GermanMelania:


What do you produce and export? You import everything. You wont eat local rice for the betterment of the country. All thoss small small actions count.
Oya creat covid test you cant.
Naija is bad naija is bad but we are all contributing by buying imports
Only nollywood exports and makes us money but we still abuse them. Shior.

drololaaof:
Weaked people the money changers who is going or buying abroad at this time. When nearly everywhere is locked down what do they exchanged . By this time the naira ought to be stable.

Ogo1982:
Those Greedy BDC are the Cancer of our economy

They always create panic and hide dollars to sell later at high price

Esseite:
Dollar would start crashing very soon...

Reasons:

- The borders are shut..
- The airports are shut aswell..
- Out major concerns now is food and water..
- Supermarkets would run out of foreign produce and resort to locals.
- Those turkey and dubai clothes cant come in now.
- cars are not coming in aswell..
- Chinese factories are shut aswell..

Its purposes are defeated, the demand would drop very soon.

fineboynl:
The entire world and Nigeria would never recovered from this in 10 years to come. Those should allow people get infected and and build natural immune and resistance afterall the virus death rate is low. Should we destroyed the world economy for such?

webizone:

I laugh in pidgin.

Mizwisdom:



Good question. World economy works based on deception. IMF and other economic organization manipulate economic indices to favor developed countries, America print more dollars at its own discretion, the dollar is like the world legal tender so it's going to be hard to watch it depreciate without bringing down other currencies to favor its stability.

Thanks and God bless for clarification

kikero:


Obj had economic issues during term 1 (the argument then was that we should vote for him because he had to repeat) but during term 2...oil prices started to rise again, he made the wise decision not to bring in control on prices on the GSM sector...which meant job expansions...and he also got a good deal on our debts (67% forgiven, the rest paid off)

And Obj's military rule of 1976-79 was smack dab in the middle of the oil boom years of the 1970's

Even then, our economy is vulnerable because it is reliant on the price of oil(my ultimate point) , and if oil prices were high under Buhari now, I would still be making the same criticism by the way.

It's Buhari's hardluck that he came into power when oil prices had collapsed for a year and running both times (1983 DEC, and 2015 May.). The problem i have with him is that he had the tools to get us out of the oil induced recession...and did not use them at all.

LabDNA:
The US is also hit by recession why is the dollar not also losing value in the same vein?