Nigeria will miss buhari if tinubu is sworn in...

4Play:


I wish it were true but I don't believe that 8% growth per year growth for the next 8 years is achievable.

In Nigeria, periods of strong growth often coincided with periods of big increases in global commodity (mainly oil) prices - the 1970s with the Arab oil embargo, the 2000s with China's entry into the WTO and oil prices going from a low $9 p/b in 1999 to circa $100 by 2011/12, and the 1960s post-independence boom with the discovery of oil deposits. It highlights that much of Nigeria's growth thus far is simply riding the tail winds of commodity rallies.

I think the last 8 years has seen Nigeria dig a big hole for itself which is severely underestimated. Presently, tax revenues barely covers debt expense so the first task will need to be ensuring fiscal stability. I don't believe you are going to see a big uplift in taxes. People extrapolating from the Lagos experience in the immediate period from 1999 are being naive. Nigeria as a whole saw a big increase in tax revenues and GDP from 1999 as the economy's size went from $50bn to a peak of circa $570bn in 2013/14 and the country's economic capital benefited immensely from that. There is no reason to assume this, or anything remotely close, will repeat itself.

You are right that deregulation of petrol and exchange rates will reduce the fiscal burden and the latter should boost non-oil exports (all things being equal). The reality also is that in the short run, it will cause a lot of adjustment pain by fueling even higher inflation which the CBN will need to counter by hiking up interest rates. So this monetary offset, if combined with more fiscal prudence (lower government spending and higher tax intake), will counter the growth boosting effects from deregulation. I can't see where you get your 8% growth from.

My proposal will be to do the exchange rate deregulation first. Negotiate a huge IMF loan/debt rescheduling agreement with creditors to boost forex inflow, investor confidence and fiscal sustainability. We can phase out petrol subsidy by year 2 or 3.

We then need to run a big privatisation effort with the ports, NNPC etc (the IMF will insist on this anyway). Again, this can boost forex inflow and investor confidence.

The total net effects of the above won't boost growth immediately but it will begin to unravel some of the policy errors we have been making over the years.

PS: One thing that scares me about Tinubu is that his one big idea for the economy is that we should print more money so we can spend more. That is utterly insane and there is not much else I can add on that.

Fiscal prudence I am afraid can't be the thrust of APC (BAT's) government. That is why the possible outcome of his tenure is predictable. Profligacy would sink Nigeria deeper, based on its current debt burden and export index. We see the facts, are but always quick to ignore them but prefer wishful thinking instead.

XY23:


Fiscal prudence I am afraid can't be the thrust of APC (BAT's) government. That is why the possible outcome of his tenure is predictable. Profligacy would sink Nigeria deeper, based on its current debt burden and export index. We see the facts, are but always quick to ignore them but prefer wishful thinking instead.

I will argue that they have no choice but to cut spending and raise taxes. When tax revenue matches debt expense, you have to implement fiscal austerity.

One way round it is to borrow even more from the CBN which is what has been happening in the last few years. But this fuels inflation and distorts the debt/capital markets.

I think the best solution is that a major IMF loan will have to be taken to inject forex, lower debt expense (at least in the short-term), and restore confidence in the economy and amongst investors.

Whoever won the presidency, the next few years will be tougher for Nigerians as the present government has left a few ticking time-bombs for its successor.

OneCandleAway:


Yaradua spent a part of his formative years in lagos so he was influenced. He was a teacher in a secondary school in lagos.

You are a clown

Creamcrest:
Shut up

He might end up been the best president Nigeria ever had,yorubas are better administrators than northerners.

I agree with you. The few times Vice President Osibanjo was in charge of the economy (as Buhari engaged in many of his medical tourism), we all saw the difference.

However, we can't say the same for an old man who has advanced case of Parkinson's disease with associated dementia (advanced stage) and mild psychosis. The Tinubu that governed Lagos years ago, the Tinubu that campaigned for Buhari 8 years ago, is not same man we see today. The current Tinubu has greatly detonated in both physical and mental health

XY23:


Fiscal prudence I am afraid can't be the thrust of APC (BAT's) government. That is why the possible outcome of his tenure is predictable. Profligacy would sink Nigeria deeper, based on its current debt burden and export index. We see the facts, are but always quick to ignore them but prefer wishful thinking instead.

I think you are not being fair to BAT.

He isn't a dunce and does care passionately about the country. Rumour already has it that Pat Utomi and Sanusi will head the economic team.

He has said he will make the Naira market reflective again, a policy Buhari ended which has left the economy in tatters ever since. He is also resolute about ending the petrol subsidy and deregulating the price.

These 2 policies alone would put the country on the path to fiscal prudence.

I disagree with 4play about a need to turn to the IMF. The IMF may demand higher taxes which is the exact opposite of what the country needs. A lower company tax is needed to encourage an massive inflow of both FDI and foreign portfolio investment into the country. This will flood the country with lots of fx and boost the foreign reserves

He has also in time past spoke of the need to reduce commercial banks lending rates. This needs to be brought below 10%. This will lead to a boom in local investments and a massive boost in the nations productivity which has been dealt a massive blow for years due to costly credit. The real sector has suffered greatly from it and that is why Nigerians prefer to invest in short term high profit businesses such as trading than manufacturing, agriculture, mining and real estate.

Lagos state is the showpiece of Tinubu's capabilities. It probably now has the largest and most modern seaport in the country. It is the only state with an operational metro line. Its institution are the best in the country. If a jerk is playing music at deafening levels, a call to LASEMA is all that is needed.

He would also embark on a massive privatisation of SOC. He would further liberalize and deregulate other sectors of the economy but PMB seems to have beaten him to it in some areas with some Bills recently passed.

Tinubu has a fondness for eggheads or technocrats. I am sure capable hands will man most sectors of the economy

Anyways, there are some worrisome areas.

One is with spending but profligacy is way to far. He has mentioned in the past for a need to provide universal pensions for aged. This is presently unaffordable and would adversely affect the nation's bank balance. It would create a fiscal hole, and is open to be abuse during times of elections. An increase in pensions to win votes from our old folks is a huge temptation. Sanwo-Olu just announced a 20% increase in workers salaries in Lagos state.

I basically feel your mention of profligacy is based on you measuring his government against that of Peter Obi.

I feel Peter Obi would be more prudent but would underdeliver overall in terms of economic performance.

His trip to Egypt to understudy their power sector made no sense as that country is notoriously statist. Their power sector isn't in private hands.

Creamcrest:
Shut up

He might end up been the best president Nigeria ever had,yorubas are better administrators than northerners.

yes he might end up my foot. You want to eat your cake and have it. Do you know how much tinubu has invested into becoming a president. Tinube has spent more than any political aspirant in Nigeria. Or you think he is a father Christmas. Most of you who they pay 30k to spew trash online will suffer when Tinubu start enjoying return of investment. Is Tinubu your father after paying 30k to talk rubbish and you expect him to build infrastructure for you.

Well for the sake of tinubus supporters I really hope tinubu ends up being a good president. But he won't, even peter obi wont have been a good president if he had won. No matter who wins, inflation, poverty and hardship will only continue to increase in Nigeria. You can never lose betting against Nigeria to get worst and taking life changing decisions on the basis of a better Nigeria is the most idiotic thing anyone can do.

tensazangetsu20:
Well for the sake of tinubus supporters I really hope tinubu ends up being a good president. But he won't, even peter obi wont have been a good president if he had won. No matter who wins, inflation, poverty and hardship will only continue to increase in Nigeria. You can never lose betting against Nigeria to get worst and taking life changing decisions on the basis of a better Nigeria is the most idiotic thing anyone can do.

This.

The next few years will discredit anyone who takes the reins in Aso Rock. We only experience significant economic growth in this country when there is a commodities/oil price boom which is unlikely to materialise in the next few years.

The sole source of hope is that no one can be as bad as Buhari.