Editorial

OUR BAD ECONOMIC INDICES

At first glance, the huge federal budget of nearly 7 trillion naira, in the face of a weakening naira (over 300 per dollar now), a depleted Foreign Reserve, a hopeless price of oil and a spiraling inflation rate at home seemed an indefensible, incredible optimism. But it was passed by the Senate after only a brief debate that did not give the impression that it was well-scrutinized. This raises a question: how diligent has the Legislature been in this particular job?
It is hard to overstate the dire straits in which the Nigerian economy must find itself in the next couple of years. It is probably for this reason that the unprecedented, unrealistic sum was approximated as cost of running the country this year.
Senate has not proved by its speedy passing of the appropriation bill that there is panic about the naira and the economy generally. Why so? A full-blown collapse of the naira will be disastrous. We want to see from the budget how that can be avoided before the President goes on to give assent to it.
Admittedly there are so many expenditure headings needing a lot of money. But one must cut his coat according to his cloth. This is not what the country has done if the budget should be implemented as it is.
We have our fears that the budget is over-bloated. The economic reforms required must not over-look the naira as an issue. Policy-makers in collaboration with law makers must not act as though they care little about the currency. By approving a budget of such huge current account deficit, the naira has been left vulnerable. The worth of the naira is linked with the rate of inflation. There will be trouble if inflation is allowed to run away.
Financing the budget is the last but not the least cause of concern. The main sources one can see are foreign direct investments, foreign aid, non-oil exports, loans and savings from the prudence that the anti-corruption war will impose. Hoping that these alone will fund the entire hefty budget is building our castle in the air. However, more professional work still seems necessary on the federal budget to make it an implementable economic plan rather than a political document for generating public applause. It requires a lot more pruning and cutting down before it becomes law.

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