Borrowing in the period of boom pushed Nigeria into recession-Soludo

Cidi Samuel || Former Governor of Nigeria’s Central Bank, Mr. Chukwuma Saoludo has blamed bad economic policy of borrowing during the period of boom by the Jonathan administration was primarily responsible for the current economic crisis ravaging the country.

Soludo who spoke on Thursday at the International conference organised by the department of business administration of the Nmamdi Azikiwe University, Awka, Anambra State, South East Nigeria, also blamed the the decision of the Buhari administration to implement the TSA as another reason for the crisis.

According to the former Apex bank Governor, managing and exiting a recession is never rocket science, insisting that the country could have exited recession earlier if the right policies had been put in place.

Soludo said, “Part of the problem Nigeria is having in its quest to get out of recession is poor policy.”

“Huge spending by government was one of the ways of solving the economic problem, but two wrong steps by government ruined that.

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“They brought in the treasury single account (TSA) and channelled funds into one account that did not allow spending… they also fixed the price of foreign exchange. These are things you do not do.”

Soludo stated that the situation would not have degenerated if policy makers in the present administration had risen to the challenge even though they were hubled because Nigeria failed to save at the period of boom

“Poor ideas transcended over superior ideas, and we went into recession which was slightly avoidable, that is why academics must be alive to their responsibility of nudging us to reality,” Soludo said.

“If you borrow at a time of boom, what will you do in a time of lack? Even my grandmother in the village knows this.

“At the same time when we had boom, we had unprecedented unemployment.

“The problem with Nigeria’s successive policy makers is that once oil goes up, we take it that it will remain so, and we continue to spend.

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“But once there is a shock and oil goes down, we just think it is temporary and we start borrowing.

“Nigeria can be fixed, and what it needs to fix Nigeria is not rocket science, but we do not have the will to fix her.”

Soludo called for the diversification of the economy and decentralisation of government to help the states and local governments live beyond “running to the centre for their existence and sustainability”.

“Another way of tackling the challenges of the country is to unbundle Abuja, trim down the exclusive list,” he said.

“We do not have to be running to Abuja for everything, that was why I was surprised when some people canvassed that local governments should be going to Abuja to take their allocations directly.”