The Minister of Budget and National Planning, Senator Udoma Udo Udoma, says the economy was doomed before the handover ceremony in May 2015, noting that it was the reason why Nigeria’s economy collapsed under President Muhammadu Buhari’s administration.
He disclosed that the National Bureau of statistics on Tuesday 12th February released the 4th quarter economic reports which showed the strongest performance of President Buhari since assumption of office.
The minister, who made the remarks Wednesday at the NUJ Press Centre in Uyo, said that at inception Buhari’s administration was confronted with crisis in the economy which resulted in recession by the second quarter of 2016.
“You will recall that at inception, this administration faced real crisis in our economy. Some of the features of that crisis were: sharp drop in oil revenues from N4, 076 billion in 2014 to N2,512 billion in 2015, which further declined to N1,439 billion by 2016. This was caused by the decline in oil prices from US$111 in June 2014 to an average of US$57 between January and May 2015.
“Due to these fiscal challenges, the federal government had to struggle to meet its committments and many States were unable to pay salaries on a regular basis, investors and businessmen complained about the difficulties they encountered in doing business in Nigeria.”
He disclosed that this situation caused Nigeria to rank 170th on the World Bank’s Ease of Doing Business in 2015.
Udoma further explained that “foreign reserves had dropped from $37.33 billion in June 2014 to $28.28 billion in December 2015 and further to $23.81 billion in September 2016. This was compounded by declining investor confidence which led to a capital market collapse on a worsening balance of payments.”
“Inflation rose from 9.2% in June 2015 and peaked at 18.5% in December 2016 coupled with exchange rate instability as the Naira lost value in the parallel market, ultimately falling to as low as N520/US$.
“All these led to the economy dipping into recession by the second quarter of 2016 registering GDP contraction of -1.49% from where it dipped further to 2.34% by the third quarter.”
The minister said Buhari have admitted that “with the depleted foreign reserves, falling oil prices, leakages and debt, the Nigerian econony is in deep trouble and will require careful management to bring it round and to tackle the immediate challenges confronting us”.
“Therefore Buhari’s administration took steps to stop the economic collapse, and also made efforts on the implementation of the National Social Intervention Programme (N-SIP) and other intervention programmes.
“Government is making significant progress on the implementation of the various components of the National Social Intervention Programme (N-SIP), stating that as at December 2018 the following had been achieved: 1,646,395 loans have been successfully disbursed under the Government Enterprise & Empowerment Programme (GEEP), with 1,302,793 of the loans given under the TraderMoni scheme”, Udoma informed.