Economy
By Paul Ukpabio
Professor Akpan Ekpo, chairman, Foundation for Economic Research and Training, FERT, has taken a cursory look at the economy and concluded that Nigeria will not exit recession in the first quarter contrary to projections by the country’s economic managers.
Ekpo, an economist, former vice-chancellor of the University of Uyo and a former director general at the West African Institute for Financial and Economic.
Management,WAIFEM, told Realnews that: “The economy has not performed well.”
Observing that “before the health pandemic and the sharp drop in oil revenues, the economy was in a stagflation phase as reflected by rising inflation, rising rates of unemployment and underemployment and sluggish growth of about 2 percent, Ekpo added that “The misery index kept rising, about 88 percent.”
“The country is now in a recession of a special type affecting both the demand and supply sides of the economy. The COVID-19 crisis and the uncertainty in the global oil market coupled with the consumption structure have worsened the situation. What is required is the aggressive implementation of the already grafted fiscal and investment/structural police,” he said, adding that he was referring to the 2021 budget and the Sustainability Plan.
However, he said that finding the needed resources would remain a challenge.
“The Central Bank can assist through its development functions but once an economy is deep in a recession, monetary policy may not be too effective. It was, therefore, proper for the CBN to leave all relevant indicators unchanged during its last MPC meeting, stressing that: “It is not possible for the country to exit the recession in the 1st quarter of 2021.”
He added that “If the issues highlighted above are addressed, the economy may exit the recession in the 2nd quarter of 2021.”
Ekpo’s verdict on the economy is coming on the heels of optimism expressed by Godwin Emefiele, governor of the Central Bank of Nigeria, CBN, that Nigeria will exit recession in the first quarter of 2021 even though the country is experiencing its worst economic recession in more than three decades.
According to the recent gross domestic product, GDP, figures released by the National Bureau of Statistics, the nation recorded a contraction of 3.62 percent in the third quarter of 2020. This is the second consecutive quarterly GDP decline since the recession of 2016. The cumulative GDP for the first nine months of 2020, therefore, stood at -2.48 percent.
Emefiele had assured “there is no cause to panic,” adding that prior to the recession, Nigeria witnessed 12 consecutive quarters of economic expansion after a similar experience in 2016.
Realnews reports that Ekpo recently, returned home to the university in Akwa Ibom state, to do what he knows best which is teaching and research, after nine years and six months in WAIFEM, an outfit owned by English speaking central banks of West Africa.
Reacting on how his experience in the corporate world has affected his life in the university now, Ekpo said: “I am back to the university after WAIFEM, where I was also conducting research on issues emanating from the capacity building and training programmes. I interacted more with the corporate world when I established the Business Development Unit of WAIFEM targeted at the private sector in Nigerian and other countries. Sometimes I was involved in the delivery of some courses as well as being part and parcel of the research programmes. It was not difficult to adjust because from time to time particularly on weekends I was engaged with post-graduate students at the University of Uyo throughout my stay at WAIFEM.”
– Feb, 2, 2021 @
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