Presidency Responds to New York Times: Tinubu Inherited a 'Dead Economy'

 

Presidency Responds to New York Times

The Presidency has issued a response to a critical report by the New York Times, which labeled Nigeria’s economy as facing its worst crisis in a generation. The Special Adviser to the President on Information and Strategy, Bayo Onanuga, addressed the article by Ruth Maclean and Ismail Auwal on Sunday, highlighting several misconceptions about the economic policies of President Bola Tinubu’s administration.

 

Misleading Report by Foreign Media

Onanuga criticized the New York Times for its “predetermined, reductionist, derogatory, and denigrating” portrayal of Nigeria’s economic situation. He emphasized that the report unfairly blamed the new administration for the country’s economic woes without acknowledging the existing challenges inherited by President Tinubu when he took office in May 2023.

 

Economic Challenges Inherited by Tinubu 

Onanuga clarified that Tinubu did not create the economic problems but inherited them. He quoted a respected economist who described the Nigerian economy as "dead" upon Tinubu’s assumption of office, highlighting the urgent need for economic surgery to prevent a collapse akin to those in Zimbabwe and Venezuela.

Key Economic Reforms 

The Presidency outlined significant reforms initiated by Tinubu's administration:

1. Ending Fuel Subsidies: Nigeria’s fuel subsidy regime, which cost $84.39 billion between 2005 and 2022, was unsustainable. By June 2023, there were no provisions for continued subsidy payments.

2. Exchange Rate Unification: The government unified multiple exchange rates, ending the Central Bank of Nigeria’s (CBN) monthly $1.5 billion expenditure to defend the naira, thus addressing currency arbitrage issues.

 

Impact of Economic Reforms 

Despite initial turmoil, including the naira’s depreciation to N1,900 per US dollar, the exchange rate has stabilized below N1,500. Projections suggest it could strengthen to between N1,000 and N1,200 by year-end. The economy reported a trade surplus of N6.52 trillion in Q1, reversing a deficit of N1.4 trillion in Q4 2023. Additionally, foreign investments and loans from the World Bank, AfDB, and Afreximbank have bolstered confidence in Nigeria’s economic prospects.

Tackling Inflation and Food Security 

While food inflation remains a challenge, the administration has implemented measures to boost agricultural production and reduce costs. Initiatives include:

• Investing in dry-season farming and providing incentives for wheat, maize, and rice production.
• Distributing N100 billion worth of fertilizer to farmers.
• State governments setting up retail shops to offer lower-priced food items.

Global Perspective 

Onanuga pointed out that Nigeria is not alone in facing rising living costs. The USA and Europe are experiencing similar crises. Treasury Secretary Janet Yellen and European leaders have also acknowledged the severe economic challenges in their regions.

 

Optimism for the Future

Despite current difficulties, the Presidency remains optimistic about overcoming these economic challenges. Onanuga concluded by drawing parallels to past economic recoveries in Nigeria, expressing confidence that the country will soon navigate through its present troubles.