Minister of Information and Culture, Lai Mohammed, Tuesday said Nigeria’s
over-dependence on oil is to blame for the recession the nation’s economy
is passing through.
He said the economic successes recorded by the Government of President
Goodluck Jonathan was fueled by consumption and not by investment or
production.
Mr. Mohammed made the assertion at a news briefing at his residence in
Oro, Irepodun Local Government Area in Kwara State.
He said the prevailing economic situation was not about trading blames,as
“those who understand knew that this recession was bound to happen in such
circumstance”.
He said the crash in global price of oil exposed the country’s defective
economic policy, with oil accounting for over 60 per cent of the nation’s
Gross Domestic Product (GDP).
The minister said the situation was further compounded by inadequate
reserve to cushion the effect of oil “misfortunes’’ on the country.
“We have a very defective economic structure, which depended largely on a
single platform of crude and fuel.
“Crude oil accounts for between eight and 12 per cent of our GDP and
another 53 per cent of the GDP which we call non-oil, unfortunately also
depend on the same oil.
“When the price of oil now crashes in the international market, definitely
you are bound to have this kind of shock in the economy,” he said.
He decried the citizens’ preference for imported goods to local products,
saying that substantial amount of the country’s foreign exchange earnings
was being expended on importation of goods and services.
Mr. Mohammed also blamed past administrations’ inability to achieve
massive investment on infrastructure to assist manufacturing industries
and boost agriculture production for part of current problem.
According to him, such inadequacies are responsible for the socio-economic
imbalance being experienced in the country today.
The minister, who acknowledged that there was growth in the nation’s
economy between 2010 and 2014, however, said the growth was only fueled by
consumption.
“The growth was not fueled by production or fueled by investment, and that
explains why it was shortlived,” he said.
He said the present administration’s efforts to correct past anomalies
could not be felt immediately because the rots in the system were too
enormous for short term remedies.
Mr. Mohammed said the administration inherited a debt of N65 billion on
fertilizer procurement alone.
He listed part of the administration’s reforms to include investment in
infrastructure and agriculture production.
“People say we should not talk about what happened yesterday but it is
pertinent to learn, understand and move away from past mistakes.
“In the whole of 2014 the government then, expended about N18 billion on
roads, but spent N35 billion on travels.
“This year alone, we have spent N70 billion on roads.
“People say why are these steps not being felt immediately? It is because
the last government refused to pay contractors between 2012 and 2015 even
when crude was selling at 100 dollars per barrel.
“Out of the N70 billion being owed Julius Berger, we have paid N14 billion.
“If government was not owing Julius Berger in the past — and we paid N14
billion to them — you would have seen them busy on the roads,” he said.
He said “Change Starts with Me” initiative launched by the Federal
Government on Tuesday was to instill discipline and the needed change of
attitude in both the leaders and the people.
According to the minister, such remained the basic foundation and the
driving force for actualising socio-economic transformation for the
country.
“Nigerians have to change their attitude from the past; it is not only
about the leaders but also the followers.
“This is the only way we can achieve our desired progress, growth and
development,” he said.
(NAN)