SOLUDO SHOCKING REVELATION ON WHAT RECESSION DID TO NIGERIA ECONOMY UNDER BUHARI (Must Read) - eritvnews

SOLUDO SHOCKING REVELATION ON WHAT RECESSION DID TO NIGERIA ECONOMY UNDER BUHARI (Must Read)

The former Governor of the Central Bank
of Nigeria, Prof. Charles Chukwuma
Soludo, said the size of the nation’s Gross
Domestic Product has shrunk from about
$575 billion to about $354 billion.

Soludo said this at an economic talk shop,
organised by the Vanguard newspapers.
The talk shop, which had other panelists
such as Comrade Adams Oshiomhole,
former governor of Edo State; Dr. Kayode
Fayemi, also a former governor and now
Minister of Steel and Solid Minerals; Issa
Aremu, the Deputy President of the
Nigerian Labour Congress, was
moderated by Fola Adeola, the founding
Managing Director of Guaranty Trust
Bank Plc.

The talk shop had the theme: “The Hard
Facts to Rescue the Nigerian Economy.”
It held on Friday in Lagos.
Soludo in his keynote speech said the
shrunk GDP was arrived at using the
official exchange rate of N304 to the
dollar.

In his estimation, the GDP is even much
lower, $232 billion, using the parallel
market exchange rate.
Soludo said: “In the previous 16 years,
Nigeria’s GDP more than doubled in US
dollar terms.

“But in less than two years, depending on
the exchange rate you use, we have more
than reduced the value to less than 50 per
cent of what we met, in less than two
years, in US dollar terms.
“We would get out of recession any
moment from now, with oil price
increasing.

“But it would be a miracle if the
government is able to return the GDP in
US dollar terms back to the level it met it,
even by 2023.”

Soludo commended the Federal
Government on the unveiling of the
Economic Recovery and Growth Plan.
Soludo said that the ERGP could still be
expanded on how the economic
diversification can be actualised.
He said: “But it would take all hands to
be on the deck to be able to pull out.”
He said that the present government had
tried in blocking loopholes and stopping
insurgency but solving the foreign
exchange volatilities had remained a
challenge.

Soludo said: “To be fair, this government
inherited a bad economy.
“The previous government had an
unprecedented rate of debt accumulation,
even at a time of unprecedented oil boom
and was even depleting our foreign
reserves instead of doubling the reserves.
“Insecurity, especially in the north-east
was very high, and corruption was
pervasive.”
Soludo also said that the situation called
for a state of emergency with a
progressive plan to lay the foundation for
a post-oil economy.
According to him, the foreign exchange
control has damaged business confidence
and private investments, with massive
capital flight.
He said that it had also driven the macro
economy into recession making most
macro variables worsened in the last two
years.

He said the Inflation rate has increased
about nine per cent to about 19 per cent,
unemployment from 7.5 per cent to 14
per cent.
He said: “Market capitalisation of the
Nigerian Stock Exchange from N11 trillion
to about N8.65 trillion.
“Poverty is escalating and the youth
agitation increasing.”
Soludo stressed that the present economic
situation has made business confidence to
remain very low at -29, while competitive
index also remained low.
Others, he said were the depleted foreign
reserves and current account balance
being negative.
Besides, he noted that the nation’s
sovereign credit ratings had worsened
and workers’ wages had dramatically
shrunk with high inflationary pressure.
Soludo said: “What people don’t
understand is that when workers are
owed and are paid in arrears as done in
many states, you have effectively reduced
his nominal wage for the year.
“Paradoxically, Nigeria’s rank on the
corruption index remains unchanged at
136th position, while its ranking on the
Fragile States Index has worsened.
“We are now in the red alert category of
fragile states. Many economic agents had
lost count of how many exchange rates
operates.
“We would get out of recession any
moment from now, with oil price
increasing.

“But it would be a miracle if the
government is able to return the GDP in
US dollar terms back to the level it met it,
even by 2023.”

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