By Atedo N A Peterside CON
IN my previous capacity as the Chairman of the Technical Committee of the National Council on Privatisation up until May 2015, I canvassed for the privatisation of the power sector, sale of NITEL and pushed for the sale of the refineries and the passage of the transport reform bills before time ran out on the last administration.
The Nigerian economy has since taken a turn for the worse. We are now confronted by the twin evils of economic stagnation (2.06% contraction of real GDP in the second quarter of 2016) and a high inflation rate (above 17%). Stagnation + Inflation = Stagflation. Those calling for a drop in interest rates, at a time of ravaging inflation and uncontained exchange rate pressures, are guilty of carrying out a partial/jaundiced analysis. Their prescription would further destabilise the macroeconomy.
These same people never seem to conclude their prescription. They should equally prescribe how to allocate scarce foreign exchange and attract forex inflows? If they would go all the way and recommend that we should allocate the available CBN dollars via a lottery, conducted on live television, where the winners pay N320/$1 and the losers head for the parallel market at N440/$1, then we can take them seriously. At least such a lottery would be “scientific”, transparent and corruption free.
Ideally, the economy would benefit from a dose of stimulus, but only the type that simultaneously helps to ease Nigeria’s forex scarcity problem, rather than simply heating up the forex market further.
I am an economist, an investment banker and an