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Chairman of the Peoples Democratic Party Governors’ Forum (PDP-GF) and Governor of Bauchi of State, Senator Bala Mohammed and the World Bank lead economist for Nigeria, Alex Sienaert, have disagreed on Federal Government’s reforms
President Bola Tinubu’s administration has instituted reforms including ending a decades-old petrol subsidy and devaluing the currency to try to boost output, which has been sluggish for about a decade.
Speaking at the launch of the Nigeria Development Update report by the World Bank in Abuja, yesterday, Governor Mohammed criticized the reforms of the President Bola Tinubu saying they are not working.
He said Nigerians were far from enjoying the Tinubu-led administration.
“There is a lot of pain and a lot of hardship that is beyond the subnationals. We didn’t bring these policies. The revenues that are coming are not enough to address the cost of infrastructure, to develop or improve livelihood.
“There is hunger. The policies on agriculture, on manufacturing, and so on, are not yielding the requirements. We should not be dogmatic and hang on the path of policy and academics. We should go back to the basics. Nigerians are not enjoying the regime at the time across board, not only the federal government, including the states and local governments.
“Therefore, the onus rests on you, the finance and the managers of the economy.
“We need to come up with a budget programme with economic policies that will reduce hardship. The money that we are sharing is not enough.
“The report spoke about employment, wages, how many percent of Nigerians are even employed? Most of our people live in the informal sector, we should look at how we can make them self-employed.
“The purchasing power has dwindled, these policies are not working and you know that. We are at the risk of being lynched. They just must stay in Abuja and be talking like the reforms are working. This is part of something else.”
Muhammed also said the N70,000 minimum wage is going to be implemented soon.
“I have been paying minimum wage even when it was done before. Now we are looking at our revenue. Everything should be done separately.
“Yes, we will implement the minimum wage, which you agreed to. But what is the volume of revenue we are getting? Can we do it? And if we do it, do we have anything left for infrastructure? What about power?
“The tariff is beyond the reach of the common man. We are living with these people.”
Mohammed, however, said a committee has been set up to look into minimum wage and work towards paying it as soon as possible.
However, the World Bank said Nigeria is beginning to reap the benefits of significant policy reforms following a near fiscal crisis in 2020, but must stay the course.
Mr. Sienaert said Nigeria’s fiscal deficit has reduced from 6.2 percent of Gross Domestic Product (GDP) in the first half of last year to 4.4 percent in the first half of this year, with the reforms leading to robust growth in service sectors, stability in the oil sector, and improvements in the foreign exchange market.
“We are seeing a fiscal consolidation underway with the fiscal deficit shrinking and that’s driven by a combination of expenditure being roughly constant in real terms, and revenues which are surging.
“This surge in revenues is largely due to the removal of the implicit forex subsidy that was happening before, which was even larger than the petrol subsidy, which we talk a lot about,” he said.
The World Bank expects Nigeria’s economy to grow at 3.3 percent this year, rising to 3.6 percent in 2025.
Nigeria’s fiscal crisis had been mounting following two economic recessions in the last eight years due to a combination of economic mismanagement and policy challenges.
The recent reforms, including a focus on price stability and a unified market-reflective exchange rate by the central bank, have proven critical in stemming an economic downturn, but they have stoked inflation.
“The ultimate purpose here, of course, is jobs and opportunities,” Sienaert said.
