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Economy & Politics

PMB vs ATIKU: The Same or Something Different?

The two camps have since released their manifestos.

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PMB vs ATIKU: The Same or Something Different?

Tomorrow, Nigerians will cast their votes for the sixth time since the resumption of democratic rule in 1999. While the country propounds a mixed economic policy (including the current administration), government (and to some extent, crude oil earnings) have played a key role in the health of the economy.  

Shortly after the Buhari administration assumed office, the economy fell into recession. While GDP growth has since recovered, it remains weak and the effects remain present.  

Atiku Abubakar, one time Vice President and candidate of the Peoples Democratic Party (PDP) is the leading opposition candidate. Abubakar is running with the theme of getting Nigeria to work again.  

The two camps have since released their manifestos, though the APC has a much smaller document, circa 40 pages. This in part could be due to having done a first term, and the encapsulation of its philosophy in documents such as the current MTEF and ERGP. 

The PDP manifesto, on the other hand, runs at nearly 200 pages, with much greater detail.  

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Here is a contrast of the key points espoused in the two policy documents:

Jobs 

The Buhari administration intends to double down on policies embarked on its first term such as the N-Power programme, which has seen it employ 500,000 graduates. It also targets 3 million direct and indirect jobs through an expanded school feeding, anchor borrowers and livestock transformation plans.  

Here, the Atiku document goes a bit more expansive. In addition to the emphasis on vocational training and several funds, the government will also pay attention to the film and sports industries which could be huge money spinners.  

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Infrastructure 

The two candidates support a mix of both the private and public sectors, in terms of infrastructural spending. The Buhari administration has embarked on key projects in the railway sector, and recently signed an Executive Order which will encourage companies to build infrastructure such as roads and get refunds through tax credit.  

The Atiku document, however, takes a much more private sector-driven outlook. There are plans to privatise the railways and limit the ministry of transportation to policy formulation. Atiku also plans to create an Infrastructure Development Fund with the support of the private sector.  

Power 

Here again, both candidates have expressed opposite sentiments. The Buhari document states his administration’s commitment to increase power generation and transmission output, in addition to off-grid solutions for rural communities. It also expresses a zero policy for estimated billing. This, in a way, is somewhat nebulous, because no specific plans were provided.  

On the flip side, Atiku in his policy document has taken a more holistic view. From giving industry regulator, NERC, the space to operate independently, to find a solution to the debt overhang in the industry.  

Education 

Education is one of the areas where both candidates show arguably the widest diversity. The Buhari administration intends to focus on implementing a STEAM curriculum as well as equipping 10,000 classrooms. Here once more, “We” is the operative word. 

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The Atiku document has a somewhat radical plan to devolve education to other tiers of government and focus on policy.  

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Energy 

The Atiku document also expresses its intention to privatise the country’s four refineries. In addition, the support will be given to companies operating in the petrochemicals industry such as pioneer industry status, preferential gas availability, and attractive pricing to enable them to operate at full capacity.

Security

The administration aims to tighten security across borders and decentralise funding of the armed forces. It will also execute the second phase of the Farmer-Herder and National Livestock Policy to end the decades-long conflict between farmers and herders.

The Atiku document essentially has the same template but goes ahead to specify how it will deal with other pressure points in the country such as the Niger Delta militants, and improving military-civilian relations. In addition, it draws up a framework for Nigeria’s foreign relations.

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training. He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE). He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy. You can contact him via [email protected]

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Economy & Politics

Recession: Economy should be redirected from wasteful consumption to productivity – Peter Obi

Peter Obi has warned that that the current recession could be worse than that of 2016, because debt raised by the administration was not properly invested.

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Recession: Economy should be redirected from wasteful-consumption to productivity — Peter Obi

Former Governor of Anambra State, Peter Obi, has said that Nigeria needs to trim the unnecessary expenditure on its budget and redirect the economy towards a production-based one. He also warned that that the current recession would be worse than that of 2016, because debt raised by the administration was not properly invested.

Peter Obi disclosed this in a social media statement on Sunday and in an interview with Channels TV.

READ: Afrinvest cautions FG on World Bank’s EoDB ranking

(READ MORE: Nigeria is in a weak financial position to absorb recession shocks —Bismark Rewane)

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“For Nigeria to pull itself out of this economic recession, the 2nd in the last 5 years, there’s a compelling need to cut the pork out of the budget and expenditure at all levels of government and redirect the economy from a wasteful consumption-based one to a productive economy,” he said.

He mentioned in his TV interview that Nigeria should emulate other countries trying to pull out of the economic mess by concentrating on improving monetary and fiscal policies.

READ: NBS hits back at Prof Hanke, says Nigeria’s inflation is not 33%

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READ: Surviving the looming recession in the Nigerian tech space

He said that the October protests were signs that politicians needed to sit up in order to arrest the situation before it gets worse.

“Every other country is discussing the recession and how to pull their people out of poverty. So, what we should do now is concentrate on the monetary and fiscal policies to start pulling people out of poverty.

“If you see what happened with the recent protests, you could see that we are heading into a problem. And I want our energy to be concentrated on that problem. The politicians, the class where I belong, should do more seriously, across party lines, to be able to arrest the situation before it gets out of hand,” he said

(READ MORE: Nigerians pay heavy price as laptop scarcity bites harder)

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He also stated that priority should be on putting food on the table now instead of discussing the 2023 elections.

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“For me, it is in discussing how do we put food on people’s table. Elections will come and we can see how to select the best. But let’s deal with the recession we have just entered before 2023.

“This recession is going to be worst than in 2016 because the monies we borrowed then were not properly invested.

READ: NNPC, only Nigerian company to cut losses by N800 billion in one financial year – GMD

“What we need now is to go into a vigorous regime of formulating implementable and measurable monetary and fiscal policies to drive ourselves out of the present situation,” he said.

What you should know 

Nairametrics reported that Nigeria’s Gross Domestic Product (GDP) in real terms declined by -3.62% (year-on-year) in Q3 2020, thereby marking a full-blown recession and second consecutive contraction from -6.10% recorded in the previous quarter (Q2 2020).

READ: Citibank: Bitcoin could skyrocket by $300,000 in 2021

Former Vice President of Nigeria, Atiku Abubakar, had warned that Nigeria must stop borrowing for anything other than essential needs. He added that very non-essential line items in the proposed 2021 budget must be expunged in a bid to kick-start the economy from a recession.

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Economy & Politics

Recession: Nigeria must stop borrowing for anything other than essential needs – Atiku

Atiku Abubakar has advised the Federal Government to expunge non-essential line items from the proposed 2021 budget.

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Biden should widen the AGOA for integration with the AfCFTA - Atiku, Intels denies NPA statement, Nigerian Ports Authority and Intels, Atiku Abubakar, Atiku claims he has big plans for private sector investment in infrastructure, Coronavirus: Atiku calls for petrol pump price reduction, stamp duty suspension

Former Vice President of Nigeria, Atiku Abubakar has warned that Nigeria Nigeria must stop borrowing for anything other than essential needs, he also added that very non-essential line items in the proposed 2021 budget must be expunged and others in a bid to kick start the economy from a recession.

Atiku disclosed this in a social media statement on Sunday, titled: “We Must Exit This Recession With Precision”.

Atiku said he received confirmation of Nigeria’s slide into recession for the second time in five years with a heavy heart. He urged that the poor economic environment could have been avoided if his ideas of cutting costs of governance were incorporated.

“This could have been avoided had this administration taken heed to patriotic counsel given by myself and other well-meaning Nigerians on cutting the cost of governance, saving for a rainy day, and avoiding profligate borrowing.

“Yes, the COVID-19 pandemic has exacerbated an already bad situation, however, we could have avoided this fate by a disciplined and prudent management of our economy.

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” It serves no one’s purposes to quarrel after the fact. We must focus on solutions. Nigeria needs critical leadership to guide her back to the path of economic sustainability,” he said.

Atiku warned that Nigeria’s proposed 2021 budget is no longer feasible as the Federal Government does not have the budget to afford heavy luxuries. He, therefore, urged the government to expunge every non-essential line items from the budget.

“We must act now, by taking necessary, and perhaps painful actions. For a start, the proposed 2021 budget presented to the National Assembly on Tuesday, October 8, 2020, is no longer tenable.

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“Nigeria neither has the resources, or the need to implement such a luxury heavy budget. The nation is broke, but not broken. However, if we continue to spend lavishly, even when we do not earn commensurately, we would go from being a broke nation, to being a broken nation.

“As a matter of importance and urgency, every non-essential line item in the proposed 2021 budget must be expunged.

“For the avoidance of doubt, this ought to include estacodes, non-emergency travel, feeding, welfare packages, overseas training, new vehicle purchases, office upgrades, non-salary allowances, etc,” Atiku said.

The former Peoples Democratic Party presidential candidate added that the budget must focus on essential items including human development investments and policies that increase the purchasing power of Nigerians.

” Nigeria ought to exclusively focus on making budgetary proposals for essential items, which include reasonable wages and salaries, infrastructural projects, and social services (citizenry’s health, and other human development investments)”

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” Additionally, we have to stimulate the economy, by investing in human development, and increasing the purchasing power of the most vulnerable of our population. Only a well-developed populace can generate enough economic activity for the nation to exit this recession.”

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Atiku called on a monthly stimulus package to poor Nigerians which he adds should be funded not by debt but by adding a 15% tax to luxury purchases.

He said, ” For example, a stimulus package, in the form of monthly cash transfers of ₦5000 to be made to every bank account holder, verified by a Bank Verification Number, whose combined total deposit in the year 2019 was lower than the annual minimum wage.

” How will this be funded? By more profligate borrowing? No. I propose a luxury tax on goods and services that are exclusively accessible only to the super-wealthy. A tax on the ultra wealthy to protect the extremely poor.

“A practical approach to this is to place a 15% tax on all Business and First Class tickets sold to and from Nigeria, on all luxury car imports and sales, on all private jets imports and service charges, on all jewellery imports and sales.”

“And above all, Nigeria must stop borrowing for anything other than essential needs. Again, for the avoidance of doubt, borrowing to pay salaries, or to engage in White Elephant projects, is not an essential need.

“If we keep borrowing, we stand the risk of defaulting, and that will make recession a child’s play because we will lose some of our sovereignty.

What you should know 

Nairametrics reported that Nigeria’s Gross Domestic Product (GDP) in real terms declined by -3.62% (year-on-year) in Q3 2020, thereby marking a full-blown recession and second consecutive contraction from -6.10% recorded in the previous quarter (Q2 2020).

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Economy & Politics

Nigeria’s economy dips into second recession in 5 years 

NBS data for Q3 2020 shows a dip of 3.62% in real GDP, confirming the Nigerian economy has officially fallen into a second recession in 5 years.

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Nigerian economy and its many problems

The data released by the National Bureau of Statistics (NBS) for Q3 2020 shows a dip of 3.62% in real GDP for Nigeria, which strongly confirms that the Nigerian economy has officially fallen into a second recession in 5 (five) years, since 2016, when the economy contracted by 1.62%. 

READ: Boosting IGR; A necessity for states to avoid total dependence on FAAC allocations

The decline in the GDP for Q3 2020 is not unconnected with low activities both at the domestic and international levels which hugely affected the economic growth during the quarter as a result of several lockdown measures to contain the COVID-19 pandemic all over the world. 

READ: Honeywell reports N300 million pre-tax profits in Q2 2020

The non-oil sector contributed a huge chunk of the real GDP in Q3 2020 with 91.27%, higher than its share of 90.23% in Q3 2019 and 91.07% in Q2 2020, while the oil sector contributed 8.73%, though a decrease in its contribution of 9.97% in Q3 2019 and 8.93% in Q2 2020. 

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READ: NBS hits back at Prof Hanke, says Nigeria’s inflation is not 33%

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READ: Citibank: Bitcoin could skyrocket by $300,000 in 2021

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