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Nairaland Forum / Nairaland / General / Politics / "The Economist" Accuses Buhari Of Worsening Nigeria's Economy (34989 Views)
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Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by grandstar(m): 7:36am On Jan 29, 2016 |
[quote author=igala1 post=42423838][/quote] you wrote nothing |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by muzzol: 7:37am On Jan 29, 2016 |
As a practical econmist. the following should be done: 1. Devalue the Naira. Allow it to float. Let it find its true vslue. 2. End the import restrictions on the 41 products excluded from the CBN window. 3. Slash import duties. High import duties simply rncourage smuggling. 4. Lift all import bans. Same reason as above. 5. Slash company tax to 18%. 6. Pay the monthly allocations to the 3 tiers of government in dollar certificates. This will end the persistent excess liquidity and also lead to a massive slash in inflationary pressure and interest rates 7. And so on As a practical econmist. the following should be done: 1. Devalue the Naira. Allow it to float. Let it find its true vslue. 2. End the import restrictions on the 41 products excluded from the CBN window. 3. Slash import duties. High import duties simply rncourage smuggling. 4. Lift all import bans. Same reason as above. 5. Slash company tax to 18%. 6. Pay the monthly allocations to the 3 tiers of government in dollar certificates. This will end the persistent excess liquidity and also lead to a massive slash in inflationary pressure and interest rates 7. And so on As a practical econmist. the following should be done: 1. Devalue the Naira. Allow it to float. Let it find its true vslue. I am of the opinion that as at today, there should be a protection policy for serious investors in Agric and Manufacturing....one of such is by subsidising forex for importation of their capital goods needs. By not extending same to competing importers of consumers goods, you will help the local producers to bridge high price gaps occasioned by poor infrastructures and high interest rates. 2. End the import restrictions on the 41 products excluded from the CBN window. Capital No. Enough of seeing Nigeria as just a consuming economy with bottomless supply of oil money. Reality has shown that we have to cut down on importation. Our foreign reserves can barely sustain 90 days importation. 3. Slash import duties. High import duties simply encourage smuggling. Slash duties on capital goods...increase duties on things like champagne, shoes, electronics, mobile phones etc 4. Lift all import bans. Same reason as above. No as stated above 5. Slash company tax to 18%. And where will government get money to do all it needs to do. So a company like MTN, Airtel etc should enjoy tax holidays and import waivers only to repatriate their profit back home. 6. Pay the monthly allocations to the 3 tiers of government in dollar certificates. This will end the persistent excess liquidity and also lead to a massive slash in inflationary pressure and interest rates. Is that constitutional? 7. And so on 2 Likes |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by NairaExam690(m): 7:39am On Jan 29, 2016 |
Na wha oh!!!!!!!!!! |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Wallade(m): 7:43am On Jan 29, 2016 |
grandstar: The reason the naira is exchanging at such ridiculous rate in the black market is due to the demand for FOREX by almost everyone. It is only natural for price to skyrocket when demand is growing at an alarming rate against the depleting supply of FOREX. You shouldn't be advising government to devalue to close the gap between black and official market price knowing that it will be counterproductive against the policy direction of the government to drive exports, decrease imports, force manufacturers to invest in local industries to produce finished goods in Nigeria rather than import finished goods, to create employment locally and impact the balance of payment positively. It is so bad that we wanna import everything, even toothpick. We have the human and material resources to produce locally. Why are we wasting away? Why are we dulling? Even with devaluation of the highest order, CBN can never meet all the demand for FOREX in Nigeria because the demand for FOREX is insatiable. Foreign companies and financial institutions can blacklist Nigeria or Nigerian firms for all I care. We have a huge market - population - and we are strategic to the development of West Africa. They can't afford the blacklist for long. This will compel some of them to come and produce in Nigeria. Since the government is already planning to improve investment in infrastructures and capital projects, we should be able to create an enabling environment for business to thrive in Nigeria and reduce cost of production in Nigeria. My brother! This is the best time to invest in business that has the potential to drive exports. Don't be discouraged. 3 Likes |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by mrmetoo1: 7:46am On Jan 29, 2016 |
grandstar: I'll start out by saying I'm not an economist, so please take it easy with me when I err. As much as I understand some of your points, I don't think it captures the whole picture. To me we're romanticizing devaluation without looking at the short and long term impact. Income is not going up, in fact incomes might be slashed but we're talking about devaluation in an import based country. This is not a country where its Nigerian made vs Imported, devaluation would have made Nigerian made for attractive but we solely rely on imported goods. The pain will be unbearable, inflation will be crazy and we'll be talking poverty like we haven't seen. Purchasing power will be greatly reduced, low purchasing power is an anti-stimulant. The poverty and low purchasing power is enough to discourage investors. As far as investors not coming in because of devaluation, I strongly disagree. The wrong kind of investors might not be coming in but investors will come in. We need the right kind of investors, manufacturers, solid minerals investors, those that want to invest in Agriculture, those are the ones we need. Those ones have been promised all the support they need as far as availability of forex. This is the reason CBN has promised Dangote all the support he needs for his refinery because investments like those are what is important to Nigeria. Nigeria doesn't need investors that want to go bring in their products to just come and sell and carry money back to their country. My friend told me about his cousin that brought Chinese guys over to Nigeria to start manufacturing his own brand of ACs, this is what we need. What people had done in the past is go to China, they'll have it manufactured there, they'll slap their names on it and bring it to Nigeria to sell. 2 Likes |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by AfroKnight: 7:48am On Jan 29, 2016 |
I am not pleased by the state of the economy. Yes, I know we inherited a crumbling corrupt structure from GEJ fraught with theft (especially after he lost) but things should not have gotten this low. Baba, what is happening? Why support Emefiele in his theoretical approach to our unique situation? |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by babafirst(m): 7:49am On Jan 29, 2016 |
TippyTop:How now?No be Nwobodo wey leave pdp a few days ago?PDP blood still full im body nau. |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by anigbajumo(m): 7:50am On Jan 29, 2016 |
benpedro: Exactly, the basic fact!! 1 Like 1 Share |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Wallade(m): 7:53am On Jan 29, 2016 |
grandstar: My brother, your economics is appalling! I don't agree with your school of thought. Meanwhile, there is no point itemizing my disagreement with you because you can't understand me. Best regards. 2 Likes |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Wallade(m): 7:54am On Jan 29, 2016 |
Wallade: |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by ariesbull: 7:54am On Jan 29, 2016 |
Y cry....blame it on jonathan C.... That's their way |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by ariesbull: 7:54am On Jan 29, 2016 |
Jonathan was clueless but buhari is super dupa clueless |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by muzzol: 7:54am On Jan 29, 2016 |
grandstar:Why did you assume dollar will converge closer to the official rate after devaluation when we all know that the real value is what we have in the parallel market? You are surely not unaware that the price of forex is due mostly to the crash in oil price and the fact that oil despite being contributor of just about 15% of GDP is contributing over 75% of revenue.... Moreover, no policy maker allows money transfer to drive her policies....you are so concerned about people receiving money through Western Union and the value of Naira against it. These kind of money in most cases don't enter into productive chain of the economy....they mostly use them to consume imported goods meaning they find their way back to originating place. 1 Like 2 Shares |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by igala1(m): 7:55am On Jan 29, 2016 |
grandstar: Read quotes after quotes must everyone agree with you. There's no straight or fixed jacket in economics. |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Biafrarep(m): 8:03am On Jan 29, 2016 |
grandstar:It will be a miracle if one dollar does not exchange above 500 naira before the end of march! Buhari & Economic team are fighting a lost battle, stock of forex has drastically reduced & soon CBN will be forced to devalue the naira whether it tickles Buhari's ego or not. Nigeria is facing serious crises. 1 Like |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Benteazaa(m): 8:05am On Jan 29, 2016 |
Seriously the international community is beginning to say things that get me irritated. I think We need anoda Idi Amin Dada |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by tivta(m): 8:07am On Jan 29, 2016 |
History is repeating it self, my fear is that the military might take over again... |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Shymm3x: 8:08am On Jan 29, 2016 |
grandstar: How sure are you that if the naira is allowed to float - it will peak between N230-250? Do you understand what floating is, vis-a-vis how volatile the Nigerian economy is at the moment? The whole thing is neither here nor there and I'm sure the Nigeria is far worse than it is on the surface - and allowing the naira to float might lead to hyper-inflation. Sometimes you just have to provide cover till you can find a cushion somewhere. So I'd rather they keep it fixed for now and see if they can get the necessary cushion. And due to dwindling oil prices, they can't tag it with oil. Folks need to worry more about ludicrous budget and all the asinine welfare policies, especially when the country needs to cut government spending. |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by grandstar(m): 8:10am On Jan 29, 2016 |
mrmetoo1: Dangote does not need any preferential treatment from the CBN. He can easily get all his funds from abroad. Even cement manufacturers, he being numbrr 1, are unwilling to sell their export earning to government at the officisl rate. This what you get when government picks winners. The exchange rate policy is scaring away a lot of genuine investors. You don't know the nightmare of sourcing forex. You put in for $10,000,000 and after 4 weeks, government hsnds you $1,000,000. Because the naira is sould well below it's market value, there's excessive weekly demand is $1.5b which the government can never meet. I doubt the country has any comparative advantage in making airconditioners. Its also 100% dependent on imported components. With the forex restrictions in place, this is not practical 3 Likes 1 Share |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by carboblanko(m): 8:14am On Jan 29, 2016 |
arresa:Many folks are still in denial. We were living a lie when crude was selling above $100. We became net importers of all sorts of frivolous goods like champagne. Most of the so called foreign investors took advantage of our recklessness and indiscipline and made a killing by investing in quick returns ventures that did not add much value to the economy. Now crude has crashed and the party is over. The reality is that tough decisions have to be made now. We need to curb our appetite for unnecessary imported goods and work hard to produce locally. Things would get tougher now but will improve in the long run. That is the price we have to pay for our recklessness. 1 Like |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Bheewhy(m): 8:16am On Jan 29, 2016 |
And those set of yeye economist were there when the poverty proportion in Nigeria was more than 70percent, talking abt principles that never translated into solving the real problems Nigerians are experiencing except for the few. All you are fighting for is devaluation and God will not grant you your evil desire. #Fix it don't devalue our pride 1 Like |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by grandstar(m): 8:20am On Jan 29, 2016 |
Biafrarep: I doubt he will devalue snd if he devalues. it will be far from market expectations. His belief is that those who patronize the black market are either unpatriotic or are buying luxuries. They therefore are none of his business.Only his party can stand up to him. This will only be done when push comes to shove |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by igala1(m): 8:20am On Jan 29, 2016 |
Monetary policies are designed by CBN while government channels fiscal policies. As an investor in the real sector or oil&gas sector. If I'm hoping to invest say $1m then I don't have to mount pressure or dictate to my host country its rate. I'd exchange $1:N200 at CBN rate, make my business proposals with my end users to include changes in FX. I.e I'd add my profit margin plus any change in FX in my contract. With that serious investors are not bothered about their returns on investment. What is most important to investors is TRUST. Can my business be protected by the country laws? Would my business environment be secured? Are there trainable manpower from their institutions? Commerce and Industry impacts on the economy with above strategies while "Traders" are hit & run always wanting to reap before sowing. |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by carpenter(m): 8:25am On Jan 29, 2016 |
Hmmmmmm With what is available in the public domain, I agree that a devaluation is in order. However, I am also mindful of what we may have termed the knee jerk reactions of the CBN over the past few months. I see an institution that is not sure of how it will do it but has the goal of keeping the naira as strong as possible...I support this with all of my Nigerian blood. I am also of the opinion that even though a devaluation is going to happen, it does not have to happen now. If it does without blocking the leakages and putting a system in place, the black market will just go higher and still the so called investors will be waiting for the next devaluation. We will never stop...So I wonder what we will have achieved by doing so. I wish I could deal with the banks...they are the greatest culprits, then the currency speculators. I personally do not see any point in devaluing our currency with the hope that foreign investments will flood in. Hey! Once you do that remember you have also devalued the value of assets you have in your country. Who is the CBN supposed to be helping....local investors or foreign investors? I believe a balance is required. 2 Likes |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by igala1(m): 8:29am On Jan 29, 2016 |
grandstar: Haba! Which investor puts in $10m and in 4 weeks? Thats where problem started. Do you call such an entity an investor or a trader. Investors pay salaries, investors stay for medium to long term not short time. Seriously, only the overfed are crying for devaluation my grandma don't know champagne or Gucci. |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by otiigba1(m): 8:31am On Jan 29, 2016 |
grandstar:Gbam! i think buhari should employ you and sack all those empty skulls advicing him |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Rolings: 8:32am On Jan 29, 2016 |
grandstar: How is it an outright disaster? Which sane government continue to use scarce dollars to continue to import things it can produce locally. Abeg dollar can go up to 1000 of e like but surely it will come down once the economy starts producing and we start exporting . Only those benefiting from the current lopsided economy are complaining , why should government give someone dollars to import toothpick, tomato paste, matches when there are critical areas that needs this dollars. |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by onatisi(m): 8:34am On Jan 29, 2016 |
grandstar:By the month of march when majority of those still blindly and fooolishly supporting buhari and insulting everyone that criticize him are sacked or thrown into the unemployment market and those in business are forced to closed down due to huge debt ,it is then the whole nation will start crying unfortunately it is God they start disturbing again with their prayers whereas it wasn't god that told them to collect rice and recharge cards before voting for apc . |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Reference(m): 8:34am On Jan 29, 2016 |
tsdarkside:So you guys said about subsidy removal until...why are we so slow to learn. |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by Mylove55(f): 8:36am On Jan 29, 2016 |
ellechrystal:which economic disaster, u did not read d analysis, maybe u read it with heartfill hatred, people that pull out their money wil return back very soon, they just took a brake according to d economist |
Re: "The Economist" Accuses Buhari Of Worsening Nigeria's Economy by onatisi(m): 8:37am On Jan 29, 2016 |
grandstar:My advice to you is this,for now forget any business ideas rather use the money you would have used for business to acquire more knowledge and skill then if possible leave naija. 3 Likes |
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