Vice President Yemi Osinbajo, on Monday, reemphasized the need for an effective synergy between the fiscal and monetary aspects of Nigeria’s economy.
Osinbajo spoke at the 3rd Ministerial Performance Review Retreat, held at the Old Banquet Hall of the Presidential Villa, Abuja.
According to a statement issued by Senior Special Assistant to the President on Media and Publicity, Office of the Vice President, Mr Laolu Akande, Osinbajo also spoke on how to better manage the country’s foreign exchange rate.
In his presentation titled “The Buhari Administration: Reflections on the Journey So far”, the Vice President, who detailed some of the game-changing achievements of the Federal Government said there some areas of concern in the economy.
According to him, “the first is the synergy between fiscal and monetary policy. The failure of that synergy has led to unnecessary drawbacks in our economic performance and planning. What imports are eligible for foreign exchange must agree with the fiscal ambitions for manufacturing and industry.”
“Currently such decisions on import eligibility for foreign exchange for instance is being taken solely by the monetary arm, although fiscal arm would normally be expected to lead in such matters”, he said.
Continuing, the VP also said “our exchange rate management continues to be an issue. The exchange rate of the naira to convertible currencies continues to face significant downward pressure because demand substantially outstrips supply.
“That is just the reality. On one hand we have tried demand management and rationing, which has not really worked because fixing the price while the parallel market reveals a massive arbitrage merely creates the opportunity for massive rents.
“It will also compound the backlog of remittances for foreign businesses who want to repatriate their earnings. The discussion that we must now have and going forward is how best to manage the situation by finding a mechanism for increasing supply and moderating demand which will be transparent and will boost confidence.
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“I think that a more market driven approach will be best, some price discovery within the context of a managed float is certainly required. Some efforts at controlled price discovery that had been made in the past include the Foreign Exchange Market (FEM), interbank Foreign Exchange Market (IFEM), various iterations of the Dutch Auction System. (DAS), Wholesale Dutch Auction System (W-DAS), Retail Dutch Auction System (R-DAS).
“While they may not have been perfect it would appear as if the rules were clear and there was relative stability. When people know how they can access foreign exchange competitively, this will boost confidence and inward flows will increase.”
Among the game changing achievements of the Buhari administration that the VP listed include the development of infrastructure “with the creativity we have introduced to infrastructure financing.”
He also spoke about the success of the Socially Investment Programmes and the improvements in generating capacity in the power sector and the Solar Power Naija which is in the process of providing off-grid power to about 20million Nigerians. He also spoke about the progress in Digital Economy with the sector contributing over 18% to GDP in the second quarter of 2020, almost three times the oil and gas contribution.
Delivering the Keynote address, the former Kenyan President, stressed the need to carry the opposition along for a peaceful and progressive country.
Drawing from his example in Kenya, he said countries in Africa have the same developmental problems, which he said must be confronted irrespective of who is in power.
He said what is important is continuity of programmes and succession planning.
Kenyatta also noted the current global challenges, which he said even though have nothing to do with Africa, the continent bears the brunt.
But he wondered how the continent would
meet the challenges for its patient population within the limited time frame, saying: “First is the ability to be focused on what the critical issues are. We can’t deliver on everything but focus on those areas that affect our people and enhance unity.
“The second is that the challenges we face can’t be completed by any one single administration. So, the issue of continuing and succession planning is very necessary.”
In his welcome address, the Secretary to the Government of the Federation, Boss Mustapha, said the retreat has been structured into three main focus areas.
”First is an overview of ministerial performance within the last three years of the administration, presenting key achievements and identifying opportunities for improvement.
”Second will reflect on lessons and good practices from the Kenyan presidential delivery unit while the third is ways to accelerate the delivery of flagship projects and programmes of the Buhari administration before the end of the tenure in May 2023″, he said.
Mustapha announced that President Buhari would sign an Executive Order on Improving Performance Management, Coordination and Implementation of Presidential Priorities of the Federal Government of Nigeria at the end of the 3rd Ministerial Performance Review Retreat.
British High Commissioner to Nigeria, Catriona Laing, Speaker of the House Representatives, Femi Gbajabiamila, and Senate President Ahmed Lawan delivered goodwill messages at the Retreat.
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Osinbajo, Anyim, Falana, others for conference on Africa’s economy