Barely 24 hours after the Senate reconvened and recommended to the federal government to sell some national assets to raise funds as one of the ways to bring the country’s economy out of the woods, some Senators yesterday took a different position.
This happened as President Muhammadu Buhari, while addressing a large gathering of political and business leaders from the United States, Africa and other regions of the world at the Second United States-Africa Business Forum in New York, yesterday, organised by the United States Department of Commerce and Bloomberg Philanthropies, said the country’s economic recession is an opportunity for Nigeria to diversify its economy, achieve sustainable growth and prosperity.
The president also assured potential investors that Nigeria would soon be one of the most attractive places for investment as his administration had embarked on significant economic reforms to realise that goal.
Senate President, Bukola Saraki, had while addressing plenary on Tuesday, listed measures to be taken by the executive to turn the economy around. One of the recommendations was the sale of some of the countries assets, including the Nigeria Liquefied Natural Gas (NLNG) Holdings, sale of government’s stakes in the African Finance Corporation and the privatisation and concession of major/regional airports and refineries.
But at resumption of plenary yesterday, some of the senators averred that no country ever sold its assets as a way out of economic recession.
Deputy Senate president, Ike Ekweremadu, during the debate on the state of the economy, led the pack of Senators who argued that sale of national assets was not the way out.
He cited an example of the United Arab Emirates (UAE) which according to him, “does not even allow you close to oil wells let alone sell them.”
“For a country like Saudi Arabia, its budget each year is run by investments from oil revenue. Other countries are investing; I am sure we will not be fair to the next generation if we sell off our assets. If we must sell, we have to sell the non-performing assets so that people can turn them around and create employment,” Ekweremadu added.
The deputy Senate president further pointed out that the economic recession had buttressed the importance of savings, and called for amendment of the revenue sharing formula between the federal and state governments to encourage savings.
“We need to amend section 162 especially from 3,4,5,6 where each money in the federation account is made to be shared,” he said.
He also called on President Buhari to re-jig his cabinet by putting square pegs in square holes especially in the area of economic management, and particularly identified the duo of the Minister of Budget and Planning, Udoma Udo Udoma, and his counterpart in the Ministry of Finance, Mrs Kemi Adeosun, as knowledgeable people but unfit for their current positions, given their professional backgrounds, saying that they are rather better suited for other ministries.
“The president needs to look at his cabinet. He has to put square pegs in square holes. Your excellency, distinguished colleagues, Udo Udoma is my friend, an accomplished lawyer for that matter but in fairness to him, I believe he can do better in another ministry especially like Trade and Investment, certainly not Budget and Planning.
“The minister for finance can do much better in another ministry. At this critical time we need somebody who is more experienced to man the ministry of finance so that he will be able to coordinate the strategies for this recovery,” Ekweremadu said.
In his contribution, Senator George Akume cautioned those making calls for sale of assets
He said rather than opt for sale of its assets, the country should focus on recovering stolen funds.
“If we want to sell our oil assets at this time when the price of oil crashed, how much are we going to realise? We are making a mistake here; what we are doing is to ensure that those who are within the bracket of the stolen dollars will still come to buy,” he pointed out.
He suggested industrialisation through agriculture as one way out and also advocated the review of the revenue sharing formula to encourage savings, saying states should not insist on sharing revenue.
But Senator Shehu Sani, in his presentation, disagreed with the deputy Senate president, saying that removing both Adeosun and Udoma was not a solution to the biting economic hardship.
Sani said instead of swapping ministers, there was the need to chart a new national direction. He also decried the over-dependence on oil as the only source of revenue for too long, saying there was the need for urgent diversification of the economy.
The Kaduna lawmaker noted that it was high time interest rates were cut and small scale industries were supported to produce goods for exports, adding that the current “sharing formula federalism” led the nation to the present dire situation confronting Nigerians today.
On his part, Senator Dino Melaye called for the sack of non-performing ministers.
Earlier, the Senate Leader, Senator Mohammed Ali Ndume, who opened the discussion by giving his colleagues a general overview of the situation, said the current recession was not peculiar to Nigeria, adding that the country is just one of the 15 oil-dependent countries of the world experiencing same.
“This is a global phenomenon that is not only affecting our country but all countries dependent on oil,” Ndume said, even as he blamed the immediate past government for the economic crisis, by not leaving anything behind in the nation’s reserves.
Ekweremadu, in his presentation, had also offered what he called short-term, medium and long term strategies as panacea for the situation.
According to him, these include the injection of money into the economy by the government; usage of the monies that have accrued to TSA as well as about N3 trillion recovered loot; re-negotiation with oil majors on terms of engagement in the industry; confidence-building and change of attitude, among others.
Also, as part of medium and long terms measures, Ekweremadu advocated for the restructuring or unbundling of the current federal government, improved anti-graft strategies, diversification of the economy, provision of social safety net, and cautious sale of national assets.
At the end of yesterday’s sitting, 24 senators had so far contributed to the debate which continues today. The far-reaching recommendations by the lawmakers include power devolution, granting of autonomy to states and local governments, sale of non-performing assets, renegotiation of agreements with oil majors to free resources for development, and confidence building to attract Foreign Direct Investments (FDIs).
Others are restructuring of the polity, direct engagement of the people by President Muhammadu Buhari as against the town hall meetings being held by ministers, cabinet reshuffle and constitution amendment to empower the federal government to save a percentage of the nation’s revenues for the rainy day, among several other recommendations.
The Senate is expected to, at the end of the debate, take an official position on how to salvage the economy and forward same to the executive arm of government.
Meanwhile, according to a statement by the special adviser on media to the president, Femi Adesina, the president said, “These are no doubt challenging times for the Nigerian economy. But let me use this opportunity to boldly affirm our conviction that there is no crisis without an accompanying opportunity. In our case, we see Nigeria’s ongoing economic challenges – occasioned mainly by the fall in oil prices – as an opportunity to set the economy firmly on the path of true diversification, sustainable economic growth and shared prosperity.”
The president said that the reform measures taken by his administration since inception in 2015 had started yielding good fruits, especially in the areas of security, anti-corruption and revamping the economy.
He said the priority investment sectors for his administration now are improving infrastructure, industrial productivity, agriculture, mining and digital economy where “young Nigerians are increasingly demonstrating that they have the talent and the passion to leverage.”
The Nigerian leader said that the Presidential Enabling Business Environment Council, headed by Vice President Yemi Osinbajo, will soon come out with wide-ranging business environment reforms on ports, visa-on-arrival, improving the speed and efficiency of land titling and business registration. Some fiscal incentives, he noted, include up to five years tax holiday for activities classified as “pioneer,” tax-free operations and no restrictions on expatriate quotas in Free Trade Zones, and a low VAT regime of five per cent.
“We intend to make Nigeria one of the most attractive places to do business,” he declared, even as he noted that Nigeria remains the number one investment destination in Africa.
President Buhari added that his administration will continue to strengthen government institutions in order to address the concerns of investors and ease the processes of making investments in the Nigerian economy.
“We are weaning ourselves from a historical dependence on crude oil, diversifying our economy, and putting it on the path of sustainable and inclusive growth. To this end, we have embarked on policies aimed at establishing an open, rules-based and market-oriented economy.
“We will continue to actively engage with the private sector at the highest levels, to listen to your concerns and to assure you of our commitment to creating enabling policies in which your businesses can survive and thrive,” he said, urging participants to “take advantage of this Forum to establish and strengthen business relationships, share valuable experience and collaborate for mutual benefits.”
President Buhari stressed that enormous potential exists for foreign investment and for the local economy, and listed sectors which have barely been exploited to include Nigeria’s 180-million population and abundance of labour, arable land, forest waters, oil and gas, solid minerals, livestock and huge tourist potential.
On United States/Nigeria business relations, he announced the commencement of the US-Nigeria Commercial and Investment Dialogue with focus on infrastructure, agriculture, digital economy, investment and regulatory reform to be jointly led by the Nigerian minister of industry, trade and investment and his US counterpart.
President Buhari said that after the Business Forum, he looked forward to increased trade and investment flows between Nigeria and the United States.