Updated 7 September, 2016
A Senior Advocate of Nigeria, Dr. Olisa Agbakoba, has said Nigeria will continue to wallow in economic recession until 2020 except the Federal Government takes hold of the banking sector and exert more regulatory control, among other measures.
Also, the senator representing Lagos-West Senatorial District, Senator Solomon Adeola, has called for urgent measures to tackle the current economic recession facing the country.
Agbakoba advised the Federal Government to return the Treasury Single Account to the commercial banks and create a new supervisory agency to monitor them, while the Central Bank of Nigeria should focus its attention on formulating monetary policies.
Agbakoba spoke to newsmen in Lagos on Tuesday on what Nigeria should do to come out of recession.
He said, “Give Treasury Single Account back to the banks at single digit rates and supervise the banks; I recommend a lending base of 5 per cent.
“Limit the CBN to monetary policy and take away banking supervision to new prudential regulatory authority and banking ethics to new financial conduct authority.
‘If banks focus on lending and not trading, money will flood the system for productive value.”
Agbakoba, who maintained that Nigeria’s economy had already slid further from recession into depression, also said the Federal Government did not have what could be called an economic team at the moment.
He argued, therefore, that one of the first steps that President Muhammadu Buhari should take to rescue the economy from recession was to set up an economic team comprising of experts or technocrats.
He suggested that government should engage the likes of Prof. Pat Utomi and Mr. Bismarck Rewane.
He stressed that the only way out of recession was for the government to pump money into the system by embarking on developmental projects rather than adopting austerity measures.
“We must spend our way out of recession,” Agbakoba said.
“When you go to the hospital and the doctor says you’re anaemic, only one thing is done – transfusion. So, how can the government present an austerity programme?
“The government must be clear as to what policy it wants to pursue. There is only one way out of recession and it is massive bouncing. You have to bounce the economy.
“Niger Delta is crying for money, South-East is crying for money, we all know that South-West is crying for money, so, you have public works to spend money on.
“You will be surprised if there’s a situation where Julius Berger and co are given contracts to build roads and you say for every contract, you must have 10 per cent labourers, you will find that the economy will slowly revive. But unfortunately, I am not seeing those things and if it doesn’t happen, we will be looking at a very long term, because a recession cycle is three years, but great economics, like the former Minister of Greece, can make it; we can recover by Q2 2017 but that requires applying the best possible method,” Agbakoba said.
He also argued that the emergency power being proposed by the Presidency was not necessary, saying all that the President needed was will power to do the right thing.
Adeola, who is the Vice-Chairman, Senate Committee on Communications, said it was worrisome that government at all levels were not treating the issue of recession with the urgency it required “to ensure that its duration is not unduly prolonged with untold suffering and even deaths for majority of our people.”
Adeola, in a statement by his Media Adviser, Mr. Kayode Odunaro, on Tuesday stated that the recession was not peculiar to Nigeria.
He said, “The difference here is that not much is being done to assure the people that government is on top of the situation in terms of marshaling out implementable policies to address the plight of groups that are hardest hit by the continuing recession.
“I must say that one has yet to see any urgency in providing palliatives for the poor and collapsing industries and other corporate bodies leading to serious job losses and a growing sense of despair among the general population. Experience in the past shows that one of the most reliable ways to tackle recession is to spend money on productive sector as well as welfarist spending to put money in the pockets of the poor.”