After an initial show of loss of confidence in the ability of President Muhammadu Buhari’s government to manage the economy, former President Olusegun Obasanjo on Tuesday, expressed confidence in Kemi Adeosun, Finance Minister’s ability to handle the economic challenges facing the country.
Obasanjo spoke at the National Council on Finance and Economic Development (NACOFED) holding in Abeokuta, Ogun State where he expressed optimism that the economy will soon get better.
“I want to especially acknowledge the efforts of the Minister of Finance not because she is an Ogun State citizen, but because she is doing a marvellous job in a difficult environment. You are too close to what is happening now to be proved right, but time will soon prove you right.”
On her part, the minister reiterated the resolve of the government to use the opportunity created by the current economic challenges to put the economy right structurally once and for al.
While presenting her keynote address at the event, Adeosun said underperformance can no longer be tolerated as the oil revenues that insulated the economy is no longer available.
According to her, the current administration has set out a robust plan to reposition the economy to ensure that what Nigerians are experiencing today will never happen again.
Adeosun explained that the drive for the economic turnaround is being led by the effective management of public money which will act as a magnet for the mobilisation of private capital.
“We have committed to changing Nigeria from an economic model that was driven by consumption to one that is driven by investment. We recognise that in the short term this is causing a dislocation as we redirect funds from recurrent day to day expenditure to the much-needed capital investment that will drive our economic future. Nigeria’s vast economy can only be productive and profitable when it has the enabling infrastructure needed to unlock its much-vaunted potential. Our economic plans will provide the link between our potential and our future,” she said.
she cited infrastructure development as the crucial factor to the attainment of the economic turnaround, emphasising that the country’s diverse oil and gas sectors, solid minerals, manufacturing, agriculture, information technology and entertainment sectors are united by their common need for world class infrastructure.
“This government is determined to address this through direct and highly efficient expenditure and through collaboration with the private sector.”
She however, stressed the Federal Government has already indicated that it has no intention of being a monopolist provider of infrastructure, saying the government is working closely with a number of partners to bridge the infrastructure gap and unlock the potential, noting the re-designation of federal roads to state roads that will enable such assets to be concessions and tolled.
Emphasising the need for positive contribution from all members of the federation account committee, the minister said there is need to look beyond revenue sharing.
According to her, “Nigeria is a confederation of states and is, in my opinion, predicated on the whole being greater than the sum of the parts and in this regard I am looking forward to a new philosophy behind the Federation Account. It will not be a gathering to share revenues but rather to share ideas, best practice, opportunities and attainments that will ensure that each state operates as an independent revenue generating centre that is creating development based on its local endowments.
“Nigeria’s economic recovery, of which we are extremely confident, is not a top-down recovery. It will be a bottom-up recovery. It will be driven from deep within our 774 Local Government Areas. It will percolate to our 36 States and will combine into our common Nigeria. In other words, our recovery will be driven by the activities at the micro level in Nigeria, by groups of farmers, by collectives of artisanal miners deciding to formalise and increase their production, by local companies creating out-grower schemes to support their raw material needs. It is when Nigerians begin to confidently invest that the essential foreign investment will follow. One large company that engages 3,000 workers is very exciting but more exciting is 3000 Nigerians taking on two additional staff as our SME’s represent 50% of our GDP and are the real growth drivers.
“We are working to act as an enabler by investing decisively in power, roads, housing, transportation, airport infrastructure and education. To date, we have released and fully cash backed over N700 billion and we are preparing another tranche in November. These investments are reviving long abandoned projects across the nation and directly and indirectly creating employment and wealth-building opportunities.
“I think it is safe to say that this level of sustained and targeted capital releases has not been seen in recent times and is the direction that this government is committed to. However, our focus is not limited to the hard infrastructure. The soft infrastructure of our society is also receiving attention, for the first time in our history. We have funded the social intervention programmes with the commencement of the homeschool feeding programme, the cash transfers to the poorest in our society, the job creation opportunity for Teach Nigeria which will engage 500,000 young unemployed graduates, agricultural extension workers, construction artisans and low-cost loans to small traders. These funds are flowing down into our State and Local Governm
ent Areas and will directly put money into people’s pockets and stimulate demand that will support our efforts to get the economy moving.”
She explained that The Fiscal Sustainability Plan, which was designed to reposition state finances by ensuring widened revenue focus and cost control as well as improved transparency and accountability, is a partnership commitment with State Governments to jointly improve public financial management.
“The FSP is now entering its first phase of monitoring and as we have done in the past we shall not shy away from taking tough decisions if we see states not meeting their commitments,” the Minister warned.
She declared that the Efficiency Unit which is also delivering major cost savings at the federal level is now being replicated across the states.
“For this economy to move in our chosen direction of growth and job creation, it is critical that every tier of government, every agency of government is synchronised towards our collective aims. Maximising revenue on the one hand but making sure that we obtain best value in expenditure on the other hand,” Adeosun said.