Economist urges FG to formulate policies to encourage growth

Dr Gobna Wafure, Economics lecturer at the University of Abuja, has called on the Federal Government to formulate policies to enhance Small Medium Enterprise (SMEs) and the development of the economy.

Wafure made the call in an interview with the News Agency of Nigeria (NAN) in Gwagwalada on Tuesday.

According to him, SMEs contributed significantly to the growth and development of the nation’s economy, and therefore required government policies that would enhance its growth backed by adequate financial assistance.

“The government has a role to play by formulating policies that would sustain the growth of SMEs in the country through soft loans and reasonable lending rate."

“If entrepreneurs can have access to funds, it would bring about job creation and encourage Nigerian youths to become self-employed."

“Some entrepreneurs are not always given the chance to showcase their products during trade fairs because of some stringent policies in the country,’’ he said.

Wafure, who disapproved suggestions for the devaluation of the naira, argued that doing so would affect small business operators in the country.He said also that it would have negative impact to the nation’s economy.

He however, observed that the Federal Government’s move to diversify the nation’s economy was a good step in the right direction to curtail the negative effects of the falling price of oil.

The university don said that the Nigerian economy which depended on crude oil exports for 98 per cent of its revenue was vulnerable to the multiplier effect of the falling crude oil price.

“For a developing country like Nigeria which depends on crude oil exports for 98 per cent of its annual revenue, the economy is bound to suffer; there is bound to be a multiplier effect on all sectors."

“There will be inflation, job cuts causing unemployment and crime, budget deficits due to lack of funds to finance government expenditure based on expected revenue and inability to finance key sectors like agriculture among others."

“The nation’s foreign exchange earnings will also drop because we buy foreign goods with the proceeds of the oil sold,’’ he said.

He listed the repercussions of oil dependent economy to include inflation, budget deficits, poor financing of key sectors of agriculture and industry.

Wafure, therefore, urged the government to diversify the nation’s economy from being mainly a mono-economy or oil-dependent, by investing in other key sectors from which it can generate national income.