Our Reporter
Vice Presidential Candidate of the People’s Democratic Party (PDP) in 2019 elections, Mr Peter Obi, has advised the Federal Government to support micro, small and medium enterprises (MSMEs) to fast-track the country’s exit from recession.
Obi, who spoke on Arise TV yesterday, agreed that the current recession, which affected about 40 countries around the world, was as a result of the COVID-19 pandemic. He however warned that the recession would bite harder on Nigeria because the country already had ‘underlying economic conditions’ ranging from extreme poverty, high unemployment rate, high number of out-of-school children, highest infant mortality rate and soaring incidences drug abuse, among others.
He said: “When government supports and empowers small businesses, there will be greater productivity which will reduce unemployment, generate more revenues for the government and increase development in the country. China, for example, finances most of their budgets with taxes from small businesses, because they have a strong MSME sector that contributes greatly to their economy.”
Obi said unlike the previous recession, where the country recklessly borrowed its way out, this current recession demands fiscal discipline for the country to scale through.
He argued that the COVID-19 fiscal stimulus of about $5 billion provided by the Federal Government to recover the economy was too low, arguing that it would have little or no positive impact on the economy. Comparing Nigeria with India, Obi said it was spending around $300 billion to help them exit the recession, out of which $50 billion is for supporting small businesses. He what was more worrisome, was the fact that even the little fiscal stimulus provided in Nigeria, was not getting to the right people and are not well accounted for too.
Obi also suggested a private sector driven economy that would lift many financial burdens from the government. He said the government could partner with private companies on road construction and maintenance and other public utilities. Apart from generating more revenues for the government, Obi said such moves would help curb wastage and financial imprudence associated with the public sector.
He further urged the government to ensure that every kobo borrowed in the country is put into productive use and not consumed or wasted. He advised Nigerians to focus their strength on building the nation’s economy and not getting distracted by any political drama going on in the nation.
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