Borrowing, power, key to growing economy, says minister
The Minister of Industry, Trade and Investment, Okechukwu Enelama, has allayed fears over Federal Government’s plans to borrow $29.960 billion.
Enelama said while the debt stock might rise, the primary focus should be the quality of the debt deals and ensuring that the implementation of the projects for which the debts were entered into are worthwhile and able to provide the resources to pay back.
The minister, who was assessing the state of the economy at the FBNQuest investor conference in Lagos, yesterday maintained that industrialisation of the country would remain a mirage without power sector development.
According to Enelama, the time has come to change discussion about the economy from that of lamentation to solutions, adding that his ministry is already developing strategies to tap into digital technologies to boost trade and investments.
He admitted that the administration must deliver on creating and implementing frameworks for enabling environment where partnership private investors and private capital will thrive.
He said even as ease of doing business in the country is high, infrastructure challenge has been the key.
The minister expressed the hope that with the right policies and the will to implement, globally tested policies would work for the country.
He also admitted that the implementation of policies has always not been easy, citing Germany and Chile as examples of revived economies with full implementation of structural reforms.
According to Enelama, several interventions in the country, which are currently running into billions of naira, have been designed on faulty premise. He insisted that these should have been created in a way that make it simple for small and medium enterprises (SMEs) to access the funds without difficulties.
Gregory Kronsten of FBNQuest, in his presentation on Nigeria’s economic outlook, said the growth pressure on the country is still high as there is a projected -1.7 percent year-on-year contraction in third quarter, making it the third consecutive negative growth in the year.
He said that the authorities seem to have no choice but to reach a deal with the Niger Delta militants and ensure that its fiscal operations provide some boost to the economy.
However, Kronsten noted that there has been a trend of increase in the federal allocations for the past three months, but mostly driven by the devaluation of the currency and stronger non-oil revenue collections.
He also noted that it has become a struggle to see foreign exchange inflows to complement apex bank’s small daily offering, adding that the various solutions to the problem are either not large enough to make impact or politically unacceptable.
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