Okenyi Kenechi
There are so many troubling issues about the president Mohammadu Buhari-led federal government. Of those troubling issues wrong with the government, the handling of the economy seems to be the most confusing to them. The government has, over time, exhibited mental laziness in its handling of the economy.
The government has kept running in a circus, trying to outdo itself with disagreeable policies. It has also drawn the line, making an enemy out of the poor citizens whom they continue to tax to death.
To keep the Naira stable, this government did the unthinkable; it sent security agents to the streets of Abuja to arrest Bureau De Change operators. Then it began restricting importation on some commodities as against advice to allow market forces to determine foreign exchange. This is in an economy that is import-driven as production is low; as if there is even electricity to produce a thing. When Nigerians pointed out that importation of petroleum products is the elephant in the room, the government went cold as its hands were forced to allow market forces drive the exchange rate. Such is the confusion in the head of policymakers of this government who are not after wealth creation but damaging the already diminishing wealth of the citizens.
Four key things that are shaping the future of the contraption called Nigeria occurred within a space of one week. On the day that the presidential election petition tribunal delivered a controversial judgment that many people have criticised, the Federal Government, through the ministry of finance, proposed an increase in value-added tax, VAT, from 5% to 7.5%.
The government had been running from pillar to post the moment it agreed, during a pre-election gimmick, to pay 30 000 minimum wage which would see its wage bill increase by more than 2 trillion. To bridge that financial gap, it did not think it wise expand revenue by generation through industrialisation, or to cut the high cost of governance but to tax its impoverished citizens more.
But while Nigerians were trying to understand the rationale behind that VAT rough tackle, with the government dispatching its henchmen to TV stations to rationalise it, the central bank smuggled its ill-thought imposition of charges on Bank deposits and 50 Naira stamp duty on Points of Sale at a time other countries are encouraging businesses and entrepreneurs by taxing them less. Do you support cashless policy by forcing stamp duty on POS transactions or by providing incentives that would make cashless transactions attractive?
The Buhari’s government has become notorious for trying to steal where it did not sow; an ideal-less government run by genetically modified politicians with a poor mentality that wants to tax Nigerians more with no clear developmental plan or clear evidence of what it achieved in four years. A government whose idea of encouraging entrepreneurship is trade Moni should not be taken seriously anyway.
The government simply wants to get rich by taxing poverty. This is at a time the Senate budgeted a whooping 5.5 billion for exotic vehicles. We have Draculas in power who would stop at nothing until we are drained.
According to Professor Asonumaka Wakama George, Toxic Treasury Single Account was one of the leading causes of our recession in 2015 all through to 2017. The rest was the war in the North East and a government with no knowledge of how to handle Nigeria’s complex economy.
According to the professor, the full-scale introduction of TSA by withdrawing money from the financial system (banks)-was the nail to the coffin of our struggling economy.
“Okonjo Iweala suggested the TSA, but when she calculated the cost on the economy, she suggested that it be implemented in phases. The government, with an imported backwater economist as finance minister, failed to read the signs.
“When this government came, they declared the TSA policy and made it a flagship policy, implemented in one stroke. TSA withdrew 3.5trillion liquidity from the economy at once.
“That’s big indiscretion at that time it was introduced when inflows from oil revenues were down. It’s a basic equation that the resultant GDP is a function of the stock of money and the velocity of money.
“Now, here, the stock of money was reduced by ₦3.5trillion Naira at once, what were you expecting? Of course, reduced GDP.”
Loads of articles had been written about how this administration ruined the economy, leading to over 20 million Nigerians losing their jobs. Companies folded up without notice. There was no economic direction. At that same time, Buhari’s minister of finance was telling us that the recession was just a word.
Nothing in Nigeria is safe from the administration’s political interference except, perhaps, the air that we breathe of which politicians have not found a way to use it against us.
Every government in power tries to destroy what the predecessor built. This administration has taken it a notch higher. Twenty years after democracy, we can’t list our achievements, except being the poverty capital of the world.
Having worked in the media for years, I am convinced that development will continue to elude us if we continue to run on this structure built on patronage where our leaders exhibit billboard mentality when issues of national interests are up for discussion.
A government that wants to increase VAT, raise stamp duty, tax bank deposits and engage in other economic harakiri, unfortunately, has refused to reduce its emoluments and cost of governance.
It has also refused to go about its cashless policy with adequate technical support infrastructure in place.
This is a country with low internet penetration rate, weak and slow internet/GSM network services, low POS. per merchant subscription level, Low ATM per user services and a high degree of transaction failures/reversals. Come on! Who are advising these people?
A feudal type of economy only considers the welfare of the elites. This is why the majority of the citizens are getting poorer while the elites are rolling in the mud of wealth. Worse still, the CBN wants to use the wealth in some states by singling them out for deposit charges, to subsidise its fraudulent cashless policy in other states.
Money is a weapon of war in a feudal economy, and your enemy must be kept poor.
Nigeria will never work.
