Experts blame nation’s economic woes on bad leadership

Economic woes

Keynote Speaker, Managing Director/ Chief Executive Officer (CEO), Financial Derivative Company Ltd; Bismarck Rewane (left); CEO, RTC Advisory Services Ltd; Opeyemi Agbaje and CEO, Vertex Energy Ltd, Segun Olujobi during the SIAO Roundtable titled: Growing the Nigeria Economy in this New Era’’ in Lagos PHOTO: ADENIRAN AYODELE

AS the nation grapples with economic problems, experts in the business sector on Tuesday blamed the current unsavoury development on bad leadership.

Specifically, at the SIAO Roundtable Evening, titled: “Growing Nigerian Economy in This New Era”, the stakeholders also called for the removal of fuel subsidy, pursuit of realistic Petroleum Industry Bill,(PIB) ,enthronement of efficient procurement processes and an inquest into non-payment of salaries by states

. Delivering the keynote address, the speaker and Managing Director of Financial Derivatives Limited, Bismarck Rewane, said the nation’s economic challenge heightened with the compromise of the watchdogs.

“There have been obvious institutional weaknesses for long, which is an evidence of leadership failure. This can only be addressed if the new administration set its tone towards zero tolerance for corruption,” he said.

According to him, though the country has been reckoned as the biggest in Africa and 26 in the world, there are still underlying challenges, especially its growth that does not tally with certain indices and realities on ground.

He lamented the widening inequality in the “growing” economy, where 10 per cent of the population are controlling about 35 per cent of national wealth, while the Gross Domestic Product (GDP) is more dependent on services than production in the ratio of 55:45.

Rewane suggested that the way out of the challenges is for the new administration to strongly and visibly show disdain for corruption, embark on true diversification, bring to end the controversial subsidy and simplify tax administration to reduce evasion.

He also tasked the ruling government to channel any fund realized from cutting governance costs into capital expenditure, especially in power, health and road infrastructure.

The Managing Director of Vertex Energy Limited, Segun Olujobi, in his submission, raised doubts over the planned refineries’ revitalization as panacea to the lingering fuel crisis, as experience has shown that “government has no business in doing business” in Nigeria.

He rued lack of coherent energy trust, where there is lack of plan for sustainable future of energy, adding that Nigeria’s oil reserves may soon be taking declining profile, given poor investments in new discoveries. Olujobi further stressed that the nation’s oil sector has always been controversial and associated with alleged mismanagement, arising from bad structure and governance.

According to him, where a sitting minister, who should be concerned with policy making, is the Chairman of the oil corporation, the regulator of the entire industry, overseeing the operations, as well as the executor of policies, then such powers must become absolute.

The energy expert said that even gas may remain elusive because of the pricing issues and the infrastructure challenge, while the already built power plants may still stay non-functional given gas scarcity.

He ,however, advised that government should sell off its stakes in the refineries and other joint ventures, pay off workers and formulate effective private sector-led strategy, which would see private refineries spring up in a short period.

Also, the Senior Consultant and Chief Executive Officer of RTC Advisory Services Limited, Opeyemi Agbaje, said the existence of widening inequality amid persistent growth in figures, showed that there is something lacking in the economy.

According to him, if the country has been consistent with six to seven per cent growth over the years with private generators, it means that the leadership, by its failure to be accountable and responsive, is depriving the country of a better future.

Opeyemi said that the inability of states to pay the workers’ salaries after receiving trillions of naira in federal allocations is a function of corruption.

He flayed the governors for embarking on projects that are not regenerative, as well as engaging heavily in ostentatious lifestyle, with retinue of aides that gulp public funds. He faulted lack of retention of capital by states, as most of them patronize contractors who do not have physical presence in the state, encouraging capital flights from the state.

“Where would the Internally Generated Revenue(IGR) come from after spending on consumptions and non-regenerative projects? Who would they tax, besides the civil servants, when all their contractors are not based in the state?” he queried.

The consultant advocated a well scripted procurement processes in governance, which would ensure value for money and foil over invoicing, as well as create taxable entities for states’ revenue growth.

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