Professor of political economy and management expert, Prof Pat Utomi, has blamed the current economic recession ravaging the country on wrong policy implementation by the Federal Government.
Speaking on Sunday, at the 2016 Men Summit convened by the Catholic Men Organisation of the Holy Family Catholic Church, FESTAC in Lagos, Utomi said the crash in oil prices was not enough to have resulted in recession, stressing that the attitude of the present government, in the face of the dwindling oil prices scared away investors from the country.
Utomi observed that Nigeria will not be in recession if the Federal Government had borrowed money against its assets devalued early and had applied intelligent leadership.
He said, ‘’There is what we call the big man hamburger quotient which economists use to evaluate exchange rate. Macdonald hamburger in London is exactly the way it is in New York. How many naira will it take to produce this hamburger in Lagos and how many pounds will it exactly cost to produce it in London? This is what is called the big man hamburger quotient.
“At that time, the difference in Nigeria’s nominal exchange rate was there and because the major revenue was oil, whose prices had gone down, all that an intelligent leadership needed to do was to borrow against some assets, ensure they continue to fund things, use strong determination to make sure people don’t buy more than what they don’t need because that is part of what happened and ensure that there is confidence in the system so that people will know that the people in charge know what they are doing.
“That would have made people to start transacting normally. But they said how can we devalue? We will not devalue, people who have money and who wanted to bring in money felt that these people are about to make decision that might jeopardise our money tomorrow. So they didn’t bring it. Even oil companies were not bringing back their receipts and Nigerians who were exporting were not bringing back, so there was a major crisis. Instead of the thing devaluing by 6 percent, it went down to what we are seeing. So it is self-inflicted and quality of leadership.’’
Utomi’s observation is coming at the heels of promises by the Central Bank, CBN, Governor, Godwin Emefiele, that Nigeria may come out of the current economy recession the fourth quarter of this year.
He said this could be only possible when the result of the various measures put in place by the Federal Government and the monetary authorities becomes manifest.
According to him, one of such result is the decision of the CBN to establish a bridge fund for the government to utilise, stimulate the economy whenever there is a need for it.