By Prince Adetunji Adesida
Which Way Nigeria – Random Musings
First we went for European products – Mercedes Benz, BMW, Peugeot, Citroen, Carrier, Phillips, Hotpoint, Whirlpool, Ariston, Bose etc. Then we stepped down to Japanese products – Toyota, Honda, Nissan, Sony, Toshiba, Pioneer, Panasonic etc.
Next was a downgrade to South Korean products – Daewoo, Kia, Hyundai, LG, Samsung. Finally, we found comfort in Chinese brands – Changan, GAC, JAC, Geely, Midea, Hisense etc. As pressure continues to mount on disposable income, whither to next?
On another matter, I keep hearing calls to increase interest rates to moderate inflation. While I’m not an economist, simple economic principles of supply and demand suggest that if there is significant demand due to excess money in the system, this would work.
This is demand-push inflation. However, when it is driven by imported inflation due to exchange rate imbalances, high interest rates merely punish domestic production (companies borrow at higher rates while paying more for FX inputs) thus further increasing inflation. The solution may be to resolve the import-export imbalance – (reduction in imports and increase in exports eg reduce petrol imports and refine locally with the multiple by-products).
Increasing oil and gas exports, improving non-oil exports by reducing bottlenecks – logistics and the port process. There are many other business constraints that need tackling – insecurity, electricity supply, roads and rail, multiplicity of taxes and various indices of human capital development – proper education- including vocational, healthcare etc. We can then begin the drive for foreign capital – diaspora inflows, Direct and portfolio investments etc. My humble suggestion
And finally – I’m a firm believer in President Tinubu’s knack for picking good people for the right positions. However, why 48 ministers rather than the constitutionally required 36 with all the costly appurtenances of state – cars, aides, housing etc? Legislators with the infamous N160m Land Cruiser, large delegation to UAE with dubious benefits to the country in terms of value for money etc. Nigerias are being asked to tighten their belts yet the Federal Government appears to be on a spending spree.
They have also gone back to the failed social register formula. Even if the money was getting to the poorest of the poor, for how long? You give money for 6 months and then, what next? Rather than develop local projects which will give dignity of labor rather than cash handouts. Have youths engaged in road repair. Teach them to fish rather than giving fish.
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