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| Prof. Chukwma Soludo |
Former Central Bank of Nigeria (CBN) Governor, Prof. Chukwma
Soludo, has blamed ‘unprecedented borrowing’ during ‘unprecedented boom in oil
prices’ by the last administration as one of the reasons the nation slipped
into avoidable economic recession.
Soludo also lamented that instead of spending money to oil
the engine of the economy, the Treasury Single Account (TSA) implemented by the
Federal Goverment locked up huge funds that should runiing the economy.
He said reliance on oil has done more harm than good to to
the country.
He said the current economic crisis being witnessed in the
country was avoidable, adding that poor ideas by the country’s policy makers
caused led to the problem.
Delivering a paper yesterday at the Nnamdi Azikiwe
University Awka, Anambra State, at the 2017 International Conference of the
Department of Business Administration, lead presenter on: Managing a Recessed
Economy, Soludo said Nigeria slipped into recession barely a year after the
current administration took over power due to the inability of the country’s
policy makers to rise to the challenge.
Soludo said: “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.”
He said the foundation for the recession was laid by the
previous administration which according to him, borrowed to fund recurrent expenditure at a time when oil
prices were as high as over $100 a barrel.
He stated that part of the problem was because the country
failed to save funds at a time when there was unprecedented boom in oil prices,
but rather engaged in unprecedented borrowing.
He said: “If you borrow at a time of boom, what will you do
in 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.
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.
“They brought in the TSA and channeled funds into one
account that did not allow spending, and they also fixed the price of foreign
exchange. These are things you do not do.”
He said the only way to put Nigeria back on the right track
is to think beyond oil.
Another way of tackling the challenges facing the
country was to unbundle Abuja and trim
down the exclusive list.
“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,” he said.
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