President Bola Tinubu and Governor Sheriff Oborevwori of Delta State

By Godfrey Money

For the average Nigerian, or what some others may refer to as the commoner, economic development or progress is measured by the prices of foodstuffs in the market vis-à-vis their financial resources. Hence, food inflation is the single most determinant economic factor for the common man. Even though transportation fares or the prices of Premium Motor Spirit (petrol) and Automotive Gas Oil (diesel) go up, the impact is measured by the prices of food items in the market. And when farmers are driven out of the farms by insecurity, there will be a dearth of food supply in the market, hence a rise in food prices; the standard of living, viewed from a food prism, plummets or nose-dives.

The foregoing is an acknowledgement of the current hardship, especially the food crisis being faced by many Nigerians. The hardship, in different degrees, had always been there since the 1980s but took a turn for the worse during the immediate past administration due to its economic inertia and self-inflicted policy choices that condoned the menace of herdsmen, who ravaged with impunity the entire country and drove away from the farms the largely agrarian population of Nigeria. Kidnapping, maiming and killings by herdsmen and bandits became the order of the day. The economic effects now stare us in the face.

Delta State under Oborevwori can be described as one huge construction site. For the first time in the history of the state, Julius Berger is building roads and bridges. The ripple effects of such massive projects are trickling down to the grassroots in terms of thousands of jobs created and economic activities stimulated. Expectedly, this will lead to economic expansion, social mobility and rise in the standard of living.

Before the current government was inaugurated on May 29, 2023, ginormous sums of naira that could have been deployed to open the rural areas and revolutionize agriculture through massive road networks and agro-allied industries, to improve healthcare and education were expended on fuel subsidy, which was a scam of monumental proportions, and the fight against insecurity, which was exacerbated by the nonchalant attitude of the then central government. The fuel subsidy regime was a complete scam; it was a cesspool of corruption by a few elites.

By the time Tinubu assumed office as president, the country was in dire financial straits. The Nigerian National Petroleum Company was no longer remitting revenue to the Federation Account, indeed was in debt and could not meet it Joint Venture commitments. The debt service-to-revenue ratio was about 97% with a FOREX backlog in the neighbourhood of $7 billion, which is a disincentive to foreign investments in the country. Many state governments were drowning in debt, owing a backlog of salaries and failing to meet financial obligations to contractors. In short, the economy was in a state of comatose and need of radical reforms.

On 12 February 2024, a former CBN Governor, Emir Sanusi Lamido Sanusi, underscored the parlous state of the economy inherited by the Tinubu government in the following words:

Specifically, Sanusi said it was an injustice to blame President Bola Tinubu’s administration for the current economic hardship the country was facing, as, according to him, Nigeria is battling a failing economy due to the mismanaged economic policies of the past eight years.

The Tinubu Government has cleared the inherited FOREX backlog of $7 billion and commenced the implementation of a N70,000 National Minimum Wage. The debt service-to-revenue ratio is now around 65 per cent with about $30 billion Foreign Direct Investments in the country. What is more, Nigeria’s foreign reserves have risen to $40.4 billion while trade surplus increased by 209 per cent by the end of 2024.  The GDP grew by 3.85 per cent in less than two years of the current government

“I have been, over the years, talking about the pending crisis ahead of the current economic hardship. Any economist who has studied monetary policy in the last eight years knows that Nigerians will fall into this difficult situation. The difficult situation Nigerians are facing is just the beginning (if the right decision is not put in place) because Nigeria is not exceptional; such situations have happened in Germany, Zimbabwe, Uganda, and Venezuela.

“The previous administration turned adamant about our appeal for corrective measures (on the economic policy). For eight years, we were living a fake lifestyle with huge debt from foreign and domestic debts. The Central Bank of Nigeria owes over N30 trillion, which resulted in debt service surpassing 100 per cent.

“It’s an injustice for anyone to blame the Tinubu administration for the current economic hardship because there is no other alternative than the removal of the fuel subsidy. After all, Nigeria cannot even afford to pay the subsidy. In the last eight years, the Central Bank continued to print more money, and the naira continued to depreciate. There is too much naira in circulation because the CBN is printing the currency without restraint. The economy was poorly managed, and they are not willing to take advice; in the last eight years, apart from sycophancy, nothing has been done.”

During his inaugural speech on May 29, 2023, Tinubu announced the removal of fuel subsidy, and shortly after floated the naira in order to stop arbitrage, which threw up overnight millionaires under the last administration.

The Federal Government has since cleared the inherited FOREX backlog of $7 billion and commenced the implementation of a N70,000 National Minimum Wage. The debt service-to-revenue ratio is now around 65 per cent with about $30 billion Foreign Direct Investments in the country. What is more, Nigeria’s foreign reserves have risen to $40.4 billion while trade surplus increased by 209 per cent by the end of 2024.  The GDP grew by 3.85 per cent in less than two years of the current government, with a projection of an annual growth of seven (7) per cent.

All indigent students of federal higher institutions of learning now have access to loan through the Nigerian Education Loan Fund (NELFUND) to further their education, the first of its kind on that scale in this country. Insecurity levels have dropped, hence food inflation is gradually easing off. However, the sudden resurgence of killings in Benue and Plateau States in recent weeks is concerning, especially in the light of the charge that it is connected to the next general elections.

All indigent students of federal higher institutions of learning now have access to a loan through the Nigerian Education Loan Fund (NELFUND) to further their education, the first of its kind on that scale in this country. Insecurity levels have dropped, hence food inflation is gradually easing off. However, the sudden resurgence of killings in Benue and Plateau States in recent weeks is concerning, especially in light of the charge that it is connected to the next general elections. Without security, there can be no significant economic development. Hence, the government must act fast and decisively to contain the situation in order to sustain the economic gains.

As a result of the removal of fuel subsidy, the state governments now receive more funds from the Federation Account, not just to pay salaries but to embark on massive economic development projects. Among the 36 federating states, Delta is showing a good example. In such a short time of less than two years in office, the Governor Sheriff Oborevwori administration has repaid over 50 per cent of the humongous debt he inherited from the previous government. This is unprecedented in the annals of the state. The state also exceeded its revenue target by nearly 200 per cent. In order to foster economic development, the government is investing massively in education, vocational training, agriculture and small-scale businesses. Delta State can be described as one huge construction site. For the first time in the history of the state, Julius Berger is building roads and bridges. The ripple effects of such massive projects are trickling down to the grassroots in terms of thousands of jobs created and economic activities stimulated. Expectedly, this will lead to economic expansion, social mobility and a rise in the standard of living.

With insecurity contained, rise in oil production, expected to hit two million barrels per day, complimented by the continuous rise in non-oil revenues and the just-introduced “Nigeria First” policy, designed to prioritize locally manufactured goods in all government procurement processes, there is no doubt that the economy will soon turn a new page for the betterment of the Nigerian citizens.

*Money, a social enterprise development consultant, writes from Ughelli, Delta State