21 September 2016, Abuja – The President of the Senate, Bukola Saraki, on Tuesday itemised measures he said the Executive must take to take Nigeria out of recession.
The measures include the partial sale of the Nigeria LNG Limited and the reduction of government shares in upstream oil joint venture operations.
He also recommended the sale of government’s stakes in financial institutions like the Africa Finance Corporation and the privatisation and concession of major/regional airports and refineries to private operators.
Saraki made the suggestions in his address of welcome, which he read to his colleagues at the resumption of plenary.
According to him, the current economic recession transcends political parties, as well as religious and socio-cultural divides.
The Senate president noted that the economic problem facing the nation was a collective problem and should be treated as such.
He stressed that the Executive must begin to take steps to show not only Nigerians but the international community as well as local and foreign investors that the nation was ready to reform and do business.
Saraki said, “The Executive must immediately put in place a leadership-level engagement platform with the private sector. This must be one that is pro-business and shows unequivocally that the government is ready to partner the private sector towards economic revival. This is a critical signpost towards market confidence, which is a key ingredient to help us revamp the economy out of recession.
“The Executive must raise capital from asset sales and other sources to shore up the foreign reserves. This will calm investors, discourage currency speculation and stabilise the economy.
“The measures should include part sale of the NLNG Limited; reduction of government’s shares in upstream oil joint venture operations; sale of government’s stake in financial institutions e.g. Africa Finance Corporation; and the privatisation and concession of major/regional airports and refineries.”
The Senate President also insisted that the Executive should consider tweaking the pension funds policy within international best practice safeguards to accommodate investment in infrastructure and mortgages.
He stated, “The Executive and CBN must agree on a policy of monetary easing to stimulate the economy and harmonise monetary and fiscal policies until economic recovery is attained. We must ensure that local government borrowing does not crowd out credit for the private sector.
“The Executive must re-tool its export promotion policy scheme with export incentives such as the resumption of the Export Expansion Grant; and introduce export-financing initiatives. The Executive is urged to engage in meaningful dialogue with those aggrieved in the Niger Delta and avoid an escalation of the conflict in the region.
“The National Assembly is very ready to play any role in the process and offer ideas on approaches that will deliver quick win-win in order to move the region and the economy forward.
“The Executive must as a deliberate response consider immediate release of funds to ensure the implementation of the budget for the near short term to inject money into the economy.”
However, the Nigeria Labour Congress and the Trade Union Congress faulted the call by Saraki and other prominent Nigerians for the sale of some national assets.
The General-Secretary, NLC, Dr. Peter Ozo-Eson, and President, TUC, Mr. Bala Kaigama, stated this in separate telephone interviews with our correspondents on Tuesday, while reacting to the call.
Ozo-Eson and Kaigama said that those in the forefront of the move to sell the national assets were being motivated by a desire to acquire them.
Ozo-Eson advised the key players in the President Muhammadu Buhari administration to avoid taking advantage of the economic situation to loot the remaining national assets in the country.
He insisted that acquisition of national assets by those in power was partly responsible for the current economic situation in the country.
He added that selling the NLNG, airports and other assets would only compound the nation’s economic woes as had been demonstrated by the woeful performance of the power sector.
The NLC general-secretary said, “Selling national assets is not going cure the economy. Part of the crisis we are in is as a result of the national assets they distributed to themselves.
“They should not use the economic situation as a pretext for looting what is left of the public assets. Selling the NLNG, airports and all those other assets will not be the way to bail out the economy from this crisis. It will rather compound it as has been demonstrated by what they did with power, and other assets.
“We are opposed to the sale of those assets because they just want to take them over the way they have taken over the power sector and it is not functioning. So, that cannot be the excuse. We are opposed to it. What we will do if they go ahead is a matter that we will discuss at that point in time.”
Kaigama said that those behind the clamour for the sale of the national assets would only distribute them to their cronies.
He said that the administration should concern itself with the provision of a road map to get the economy out of recession rather than the ploy to sell the assets.
Kaigama stated “Well, I don’t know what they mean by that because these are very vital national assets. Are they saying that as soon as we sell these assets, we will be out of recession?
“Otherwise, why don’t we work out a plan that will get the economy out of recession and not this kind of fire brigade approach? Obviously, that is what it is going to head to because they will sell them to their cronies. The TUC is not in support of this.”
Rather than sell the assets, the Federal Government should borrow from the International Monetary Fund, according to the Revenue Mobilisation, Allocation and Fiscal Commission.
The Acting Chairman of RMAFC, Mr. Umar Gana, said this in a statement made available in Abuja on Tuesday.
Gana said the opinion of the agency was different from that of business mogul, Alhaji Aliko Dangote, who had in an interview with a cable television, CNBC Africa, advocated the sale of NLNG and other federation assets as a way of augmenting government revenue shortfall as a result of the current economic recession.
He said, “It is the considered view of the commission that Nigeria’s assets such as the NLNG and other strategic national resources should not be sold to meet short-term financial obligations.
“It will be recalled that the Governor of the Central Bank of Nigeria indicated in a media report that the sum of $10bn would be realised from the sale of these assets. The commission is of the strong opinion that the same amount could be borrowed from the IMF and the revenue from these assets could be used to amortise the loans over an agreed period.
“It should be noted that after the amortisation of the loans, those assets would still be owned by the federation in addition to their regular dividends and revenues.”
Gana argued that it would be unwise for the Federal Government to dispose of its crown jewels that were generating revenues that keep the Federation Account healthy over the long-term.
He said since the assets were generating revenues, the government could borrow from the IMF and amortise the loan with revenues emanating from the assets.
Gana also counselled that instead of selling off vital assets generating funds for the federation, wealthy Nigerians should be encouraged to set up their own liquefied natural gas projects since was blessed with abundant natural gas reserves.