Sanusi: How to reset Nigeria’s economy

The former Emir of Kano and ex-Governor of the Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi, says reduced dependence on Premium Motor Spirit (PMS), fondly called petrol, will be the long-term solution to the fuel subsidy removal crisis.

Sanusi said this at the Distinguished Lecture Series of the Nigerian Institute of International Affairs (NIIA) in Lagos on Thursday, October 19, 2023.

He said: “In the short term, the most effective measure to offset the removal of fuel subsidy is cash transfers.

“The design of individual cash transfer programmes varies considerably in reach and coverage.

“The long-term solution is to reduce dependence on PMS.”

The former CBN Governor said Nigerians would need to appreciate, across board, the economy’s importance, noting that many citizens didn’t understand it.

Sanusi said in resetting Nigeria’s economy, it would be important to bring economics into public discourse.

He emphasised the importance of recognising the primacy of politics in economic matters, saying an economy is run on the basis of the ideological orientation of those who control the state.

The former Emir added: “If the state is a rentier state where the people in control see it as an avenue to make money for themselves and their families, they are never going to run an economy in a manner that encourages production and growth.

READ ALSO: Sanusi: Buhari’s regime corrupt, jobless boy bought private jet

“If it is run by people who are thinking long-term and of the legacy they will leave behind for their children and the future of the country, they will run different sets of different policies.

“I think every economist knows that multiple exchange rates are a problem, but as long as politicians are able to give themselves a dollar at 400 naira and sell at 700 naira, they are not ready to listen to the economists.”

Sanusi noted that Nigerians had been talking about fuel subsidy as far back as 2011, saying: “We said if we did not do something about those subsidies, we would end up where we are today.”

The former CBN boss stated that civil society should be blamed than politicians for the current economic situation of the country.

Sanusi also said the governance of the economy was an important aspect to note in resetting the economy, stressing that the country cannot continue doing the same thing and expect a different outcome.

On Nigeria’s Gross Domestic Product (GDP) and debt ratio, Sanusi said Nigeria has huge revenue problem.

Sanusi, who said one of the solutions to Nigeria’s fiscal problems would be to raise revenue, urged that the image of the country should be improved to make it an attractive destination for investments.

He stated: “Oil is not enough to make us rich but enough to put us in trouble. Nigeria will never get rich from producing oil.

“At best, it represents working capital that can enable the launch of other industries.

“Nigeria produces just 2.3 barrels per person per year compared to Saudi Arabia’s 91.4, Kuwait’s 221.6 and Gabon’s 31.7.”

Also speaking at the event, the Director-General of NIIA, Prof. Eghosa Osaghae, described Nigeria as an endowed country and Africa’s biggest democracy.

He noted that the country had been through challenges but expressed optimism that it would surmount all challenges.

“We have continually proven to be the giant, and we must lead others there,” Osaghae said.

The Star