The former Minister said this at the inaugural Business Lecture of the Lagos Country Club in Lagos on Thursday night. According to her: “The parlous state of the Nigerian economy by the 29th of May, 2015 should have instructed an incisive and urgent macroeconomic stabilisation programme to realign the price levels in the economy.
By May 2015, we knew we were already in trouble. As a matter of fact, we were already in trouble in 2014. That was the first time that growth collapsed to 3.8%. The incoming administration should not have been told that we were weak and vulnerable.
Had the government made quick and necessary adjustment that corresponded close enough to the level of impact of the 40% decline in oil revenue, our story could have been different today. We would never have lost growth.
The attendant fiscal pressure and the delayed right policy responses were severe enough that by 2015, economic growth had sharply declined from 3.8 to 2.7%. And then began the sharper loss of growth into negative growth rate by 2016.
So, it is accurate to conclude that both the preceding and successor governments conspired by their actions and inactions to throw the Nigerian economy into the deep throes of economic recession.
The record of the government today for timely and right actions on the economy is, however, so far not encouraging at all. For almost one year, the government delayed prime action on the fuel subsidy regime despite its aggravating import on fiscal imbalance.
Over the same period, it delayed the right action on the exchange rate policy despite the deleterious effects that it was having on foreign reserves, the value of the naira, as well as on inflation.
Before the government came on board, inflation level was 9%; today, inflation has doubled to more than 18%. The greatest enemy of the poor is inflation. The greatest enemy of business is inflation. All you need in order to destroy the poor is total unstable price levels in an economy
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