From Abel Leonard, Lafia
In a recent exclusive interview with The Sun Newspapers, Dr. Abdulkareem Alhassan, a lecturer at the Department of Economics and Head of the Staff Productivity Promotion Unit at the Federal University of Lafia, offered profound insights into Nigeria’s economic landscape.
With a keen understanding of economic dynamics, Dr. Alhassan delved into the intricate challenges facing the nation, particularly concerning inflationary trends and exchange rate pressures.
He provided astute analysis and proposed strategic policy measures to navigate these complexities and foster sustainable economic growth.
Q: can you shed more light on the proposed strategies to mitigate the current inflationary trend and exchange rate pressures in Nigeria?
A. To tackle the challenges of hyperinflation and exchange rate pressures, we need multifaceted approaches. Firstly, advocating for trade expansion and export promotion can play a pivotal role. By boosting exports, we can increase foreign exchange reserves, which in turn can stabilize the exchange rate and mitigate inflationary pressures.
Q: How do you envision trade expansion and export promotion being implemented effectively in Nigeria?
A: Implementing trade expansion and export promotion requires a combination of policy measures and structural reforms. Firstly, we need to enhance the competitiveness of Nigerian exports by improving infrastructure, reducing trade barriers, and providing incentives for export-oriented industries.
Additionally, fostering partnerships with international trade organizations and neighboring countries can facilitate smoother trade relations and open up new markets for Nigerian goods and services. Furthermore, investing in research and development to enhance product quality and innovation can enhance the attractiveness of Nigerian exports in the global market.
Q: What role do you see the government playing in facilitating trade expansion and export promotion?
A: The government has a crucial role to play in creating an enabling environment for trade expansion and export promotion. This includes formulating clear and consistent trade policies, providing financial support and incentives for exporters, and investing in trade-related infrastructure such as ports, roads, and logistics facilities.
Moreover, the government can facilitate trade negotiations and agreements with other countries to eliminate trade barriers and create preferential access for Nigerian exports. Overall, a proactive and supportive government stance is essential to unlock the full potential of Nigeria’s export sector and alleviate inflationary pressures.
Q: Dr. Alhassan, you’ve highlighted the negative effects of the border closure and insecurity on Nigeria’s food supply, leading to inflationary pressures. Can you elaborate?
A: In the face of these challenges, implementing targeted policy measures is essential to mitigate inflationary pressures and stabilize the exchange rate. One critical strategy is to focus on improving the intensive margin of export.
Q: Can you explain what you mean by improving the intensive margin of export and how it can be achieved?
A: Improving the intensive margin of export entails increasing the quantity of goods and services already on the export list. This can be achieved through various means, including providing incentives to producers to ramp up production and export activities.
Incentives such as tax breaks, subsidies, and access to credit can encourage producers to expand their output and take advantage of export opportunities. By incentivizing export-oriented industries, we can bolster foreign exchange earnings, which can help stabilize the exchange rate and alleviate inflationary pressures.
Q: How feasible do you think it is to implement such measures given the current economic landscape in Nigeria?
A: While challenges exist, implementing measures to improve the intensive margin of export is feasible with strong government commitment and effective policy implementation. It requires a coordinated effort between the government, private sector, and relevant stakeholders to create an enabling environment for exporters to thrive.
Moreover, investing in infrastructure, technology, and human capital is crucial to enhancing the competitiveness of Nigerian exports in the global market. By addressing supply-side constraints and promoting export diversification, Nigeria can unlock its export potential and reduce dependence on imports, thereby mitigating inflationary pressures and stabilizing the exchange rate.
Q: Dr. Alhassan, you’ve outlined several strategies to enhance Nigeria’s export capabilities and address economic challenges. How can it be implemented effectively?
A: Providing incentives to increase the extensive margin of exports involves identifying new products with global demand that Nigeria can produce competitively. Once identified, these products should be incentivized to encourage their production and subsequent inclusion on the country’s export list.
This can be achieved through a combination of policy measures such as tax incentives, subsidies, access to financing, and technical assistance to producers. By incentivizing the production of new exportable goods and services, Nigeria can diversify its export base and tap into new markets, thereby boosting export earnings and reducing reliance on imports.
Q: How can Nigeria effectively key into forward global value chains to maximize gains and participate more actively in the global economy?
A: Nigeria’s participation in global value chains can be enhanced by shifting from predominantly providing raw materials to engaging in value-added activities such as manufacturing and assembly. This entails identifying industries where Nigeria has comparative advantages and encouraging companies to participate in the production of intermediate or finished goods within the country.
By attracting investment and technology transfer, Nigeria can integrate into global value chains and capture a larger share of the value added. This approach not only increases foreign exchange earnings but also creates employment opportunities, fosters technological development, and promotes sustainable economic growth.
Q: How feasible do you think it is for the government to provide secured farm reserves and incentives to support farmers, considering the challenges they currently face?
A:Despite challenges, providing secured farm reserves and incentives to farmers is feasible with strategic planning and resource allocation. The government can collaborate with stakeholders to identify suitable land for farming and deploy security personnel to safeguard these farms.
In addition to security, farmers should be provided with access to inputs, extension services, and market linkages to enhance productivity and profitability. By investing in agriculture and supporting smallholder farmers, Nigeria can boost domestic food production, reduce dependence on imports, and improve food security for its citizens.