By Adedapo Adesanya
Foremost Nigerian economist and think tank, Mr Bismarck Rewane, has said Nigeria now faces a quadrilemma, following the report of negative growth as announced by the National Bureau of Statistics (NBS) this morning.
Mr Rewane, who appeared on Channels TV on Monday, said that the latest pointer about the economy should push the country to start doing some things differently.
Speaking on the quadrilemma, Mr Rewane, who acts as an adviser to President Muhammadu Buhari through the Economic Advisory Council (ECA), said the country now faces a situation in which a choice must be made among four undesirable options.
“The first variable we are looking at is recession, negative growth,” he said. “The second variable is high inflation, which is almost 13 per cent.
“The third variable is high unemployment; even though the unemployment numbers are at 28 per cent, we think that it is much more than that. And finally, we have weaknesses in currency.
“So, we are having external weaknesses and vulnerabilities, slow growth, high unemployment, and, more than anything else, contraction in economic activity.
“Now we are going to move away from the monetary policy complement that we have, stimulate the economy with greater catalyst, and do some things differently,” he added.
This warning came on the outlook of the gross domestic report (GDP) which contracted by 6.1 per cent in the second quarter of the year.
Giving his view on the figures during the television programme, Mr Rewane said the decline was “surprising and concerning” but not “alarming at this point in time.”
“The truth is that the economy had its pre-existing conditions in Q1 and the lag between the slow down and the contraction was underestimated by all analysts,” he said.
Further, he noted that the federal government’s stimulus plan for the economy was inadequate to cover for the shortfall recorded by the bureau, saying “we have a N2.5 trillion equipment to fight a 12 trillion contraction,” adding that “so, the limitations and inadequacies and inappropriateness of the tools, compared to the problem we have, is stacked.
“We are saying that the move from a slowdown into a contraction was more than we expected. The tools that we have at our disposal are inadequate.
“The stimulus that is required to take us out of this equation is going to be much more than we expected. And we are going to have to take some measures,” he said further.
