Let's face it; it's been an ugly year for the economy and someone has to take responsibility.
When Muhammadu Buhari came in, he met an economy with a rising debt ceiling, dwindling oil prices, and a government with little financial discipline, but there are issues that still need to be addressed.
Muhammadu Buhari woke up on April 1, 2015, knowing he was going be the next President of the Federal Republic of Nigeria. On May 29, almost two months from that day, he was sworn in. No matter how visionary a leader is, nothing can be executed without a team. Governance 101.
It took Buhari another four months to send the list of ministerial nominees to the house for screening.
What that waiting period did was create lots of uncertainties, and if there's one thing an economy can't tolerate, it is uncertainties.
One of the reasons why 2016 was ugly is the delay in key policy implementations. Effective and efficient policies are strategic and well planned, but that’s not what we saw. Most of the policies implemented have been as reactions to current economic events rather than in anticipation of them.
For example, the removal of the fuel subsidy and the 67.63% hike in the pump price of fuel in May was done in reaction to the lingering fuel scarcity.
Also, the floating of the naira in the forex market in June only occurred after several calls for a currency adjustment from renowned economists, both domestic and international. Not like there was a real floating anyway.
While these are laudable policies, the economy might not have deteriorated to its present state if they had been implemented much earlier.
The fiscal policy is how a government spends money to influence the economy. The fiscal policy plan is in simple terms the budget. In Nigeria, the government is the biggest spender, unlike some more advanced economies where the private sector is the biggest spender. When the biggest spender isn’t spending, there’s basically no money.
Nigeria had no budget until May 6, almost halfway through the year. This clearly put the fiscal policy at a disadvantage and made it work below par.
On more than one occasion, the Federal Government gave completely different opinions to the Central Bank on the same economic issues. While this might show that perhaps, the CBN is independent of the Federal Government, as it should be, it is also a pointer to the lack of coordination. Sometimes, the Central Bank went on to blame the Government for the country’s woes, since most of the country’s problems stem from fiscal policy implementation.
Nigeria has one government, one currency, one timezone, but somehow, we have four exchange rates at the moment; the Interbank Rate, FMDQ (Financial Market Dealers Quotations), Manufacturer’s Rate (for importation), and the Parallel market (black market). You don’t have to be an expert to know that this is not a good thing.
For every journey, there’s a map. One that can guide not just the bearer of the map, but everyone who looks at the map. Almost 20 months after Buhari was sworn in as President, there is still no clear economic blueprint on where the economy is headed. How do we intend to score when we have no clear goals?
A new militant group began this year, Niger Delta Avengers, targeting not only oil installations but some infrastructure that are important for energy generation. While this might seem insignificant, for a country struggling with abysmal crude oil prices, and a suffering economy, the Avengers effect was more significant than we’d like to admit.
People have made excuses for Buhari. Like how he was taking forever to select very good ministers (Dalung, lol). Or how he inherited a struggling economy. A corrupt country. Or how he has the legislature working against him. Or this and that.
The fact also remains that in the next, say 10 years, when we think back at 2016, we won’t talk about these details. What we will remember about 2016 is this; we entrusted our economy to Buhari and he failed us.