Imminent Economic Recession: Senate Summons Finance Minister, CBN Governor

Posted by African Examiner Featured, Latest Headlines, News Wednesday, May 25th, 2016

Ayodele Afolabi, Abuja

Worried by the uncertainties surrounding the state of the Nation’s economy with indices of imminent recession, the Senate has summoned the Minister of Finance, Mrs Kemi Adeosun and Governor of Central Bank of Nigeria ( CBN), Godwin Emefiele to brief it on Monetary and Fiscal Policies being adopted by them to salvage the situation.

Senators were worried that economic policies of President Mohammadu Buhari within the last one year were not achieving desired impacts and stressed the need for an urgent review, to avoid further plunge of the economy into full blown recession.

It specifically observed decline in crude oil production from the 2016 Budget benchmark of 2.2 million barrels per day to 8,000b/d and feared that meeting key budgetary revenue projections in the budget are “practically impossible”.

To this end, the senate, stressed the need to have a rethink, so as to avoid deepening budget deficit in the 2016 fiscal year or poor budget implementation.

The resolution which was sequel to a motion moved by Senator Bassey Albert Akpan (PDP Akwa -Ibom North – East) on “an urgent need to address the present economic state of the nation”, was also based on last week report of the National Bureau of Statistics (NBS).

The NBS had in its score card for the first quarter (January -March) of 2016 for GDP, painted a gloomy picture of rising inflation and unemployment as prelude to total economic recession.

The Senate observed from the report a decline of 0.36 per cent which is a drastic drop from 2.11 per cent in Q4 2015 in GDP; increased unemployment rate to 12.1 per cent in Q1 2016 from 10.4 per cent in Q4 2015.

The report further disclosed that Underemployment also increased to 19.1per cent from 18.7 per cent in the same period, while the rate of inflation rose from 9.6 per cent in January 2016 to 13.8 per cent in April 2016 with attendant increase in prices of basic food commodities and services in the country.

Accordingly, the Senate in the motion, said it felt deeply concerned that the continued complacency of the current state of our economy if allowed unchecked, will set the tone for a full blown economic recession by the end of June this year as already confirmed by CBN in her Monetary Policy Committee (MPC) meeting of Tuesday this week.
It added that the current economic contraction is the first major drastic slump since June 2004, which according to the CBN is a 12-year-low, but the World Bank’s position is a 21-year-low.

However, the SenatePresident, Bukola Saraki , who presided when the motion was moved, did not allow it to be debated but simply called on Sen. Abiodun Olujimi (PDP Ekiti South), to second the motion.

In seconding the motion, Olujimi regretted that there is no visible economic policy in Nigeria which according to her, making government not to have clear cut economic direction for now.

She said for the nation to get a clear economic direction, there must be a workable blue print to that effect..” but was cut short by Saraki who put the question for invitation of both the Finance Minister and CBN Governor to voice votes by the senators which majority of them supported by shouting yea!