"Tinubu needs to fix that Nigeria": FT sends strong warning to Tinubu

• A Financial Times (FT) investigation has described the current policies of President Bola Tinubu's administration as disjointed
• According to the media, Tinubu’s shock treatment strategy is insufficient to address all of Nigeria's economic issues
• It also blamed the administration for the fall of the naira, exacerbating import inflation and creating the worst living standards crisis in a generation

Legit.ng journalist Zainab Iwayemi has over 3-year-experience covering the Economy, Technology, and Capital Market.

The President Bola Tinubu administration's present policies have been characterised as fragmented in a Financial Times (FT) report. It emphasised that Nigeria's numerous economic problems cannot be solved by his "shock therapy" approach alone.

FT claimed that Tinubu permitted the naira to collapse, fueling import inflation and resulting in the greatest cost of living crisis in a decade. Photo Credit: FG
Source: UGC

According to the report, Tinubu has made his 220 million fellow Nigerians swallow some bitter medicine in the roughly 15 months since he took office by eliminating a substantial fuel subsidy, one of the few advantages the people of their "inefficient and corrupt" state still enjoy.

The Tinubu administration, according to FT, also allowed the naira to plummet, which fueled import inflation and brought about the worst cost of living crisis in a generation.

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It said that these actions had made the plight of tens of millions of already impoverished people even worse.

The news outlet did however acknowledge that some of these actions were necessary to start reversing the nation's long-term economic decline.

According to the report, the fuel subsidy was unnecessarily costly, devouring about a third of the federal budget, and distorting, directing Nigerians' resources toward smuggling, rent-seeking, and graft.

It further stated that exports of all goods except oil were eliminated by the exchange rate system, which greatly overvalued the naira.

It added that cronies had access to cheap money to resell on the underground market while legitimate industries were starving for hard currency.

Even shock therapy will fail

The article emphasised that the elite class in Nigeria had learned a lesson detrimental to the country's future: it would prefer not to produce anything if it could profit handsomely from arbitrage.

“It is necessary, but insufficient. ‘Tinubunomics’ is so disjointed it barely deserves the name. Shock therapy will probably fail if important adjustments are not made.“ First, the president must chart a course ahead and convince Nigerians they are in it together. For that to be remotely credible, the political class must make sacrifices. Out must go lavish pay rises for civil servants and flashy cars (not to mention jets) for government officials.“Tinubu only has to look at Kenya, where violent street demonstrations have forced the government to withdraw tax rises, to see what happens when a sense of injustice festers. Likewise some savings from the fuel subsidy should be redeployed to support the most economically vulnerable as a priority.“Hunger levels are soaring and millions of children are foregoing meals and school. Nigerian politicians love to be seen handing out bags of rice. But what is needed is direct cash payments to people’s phones, the technology for which exists, and in the longer-term a proper safety net.“As things stand, the state lacks either the capacity or the probity to administer such a scheme. Tinubu needs to fix that urgently,” it added.

Inexperienced poeple working for Tinubu

The Financial Times claimed that the president's cabinet is made up primarily of inexperienced people who got their positions through political favoritism rather than qualifications.

It added,

“ It does not help either that the state is implicated in the wholesale theft of oil, depriving the nation’s coffers of billions of dollars. Tinubu should use all his political guile to staunch the flow.”

According to the FT article, Nigeria has one of the lowest tax collection rates in the world, collecting only 10% of GDP in taxes, which is a clear indication of the lack of trust between the governed and the government.

It added,

“But if the economy is to be revived, the state needs to be an enabler. It must provide power, roads, security and justice, not to mention schools, hospitals and support for the poorest in society.“Without a properly joined-up and articulated plan, Tinubu’s bitter medicine will not cure Nigeria’s ills. It will just leave a bad taste.”

List of economic events under Tinubu

Legit.ng reported that Wednesday, May 29, 2024, marks President Bola Tinubu's one year in office, and Nigerians have had a mixed bag of experiences.

There have been a few bright spots and many events that Nigerians would want to forget quickly.

In his inaugural speech on May 29, 2023, Tinubu wasted no time. He used just three words, "Subsidy is gone," to set the template that has shaped the lives of Nigerians over the past 12 months.

Source: Legit.ng