WHAT A PROMISE “We promise our people that even with the drop in oil prices, the economy will be stable.” President Jonathan. December 4, 2014. For sheer fantasy, that declaration by President Jonathan will be difficult to surpass. While listening to a good joke “from above”. It is not often they meet with a President who does not know basic economics; or who has no official to tell him the truth. The stability promised by Jonathan was already being shattered by three events which will have domino effect on the Nigerian economy. Last week, the first part of this series ended with disclosure that the 36 States of Nigeria received about 20% less than the average monthly allocation for 2013. Bearing in mind that most states depend heavily on oil revenue allocation, it is difficult to imagine how the stable economy will be achieved. Moreover, the Federal Government had to kick in $2bn from the Excess Crude Account; otherwise the shortfall in allocations to states would have been worse. President Jonathan is not an economist. And as the Governor of the CBN has stated, and I totally agree with Emefiele, nobody, in Nigeria is responsible for the sharp drop in the price of crude oil globally. It is unfortunate that it came during Jonathan’s tenure. But, like the Tsunami, which occurred during the tenure of a Japanese Prime Minister, he must deal realistically with the problem – instead of denying what a lot of people already know. lets look at this and I stand to be corrected (1) Virtually all the states and the Federal government owe public servants salaries, allowances and entitlements – which they are finding it difficult to pay. (2) Contractors have abandoned several projects, which might become permanently abandoned, if out going governors fail to pay before departing. To all these problems there is no relief in sight. On the contrary, dwindling allocations to states are expected to make things worse. How on earth can a gradual descent from bad to worse be called stable? Amb Around
Posted on: Tue, 30 Dec 2014 11:18:01 +0000
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