A financial expert has attributed the prevailing economic difficulties, and hardships in the country primarily to the abrupt devaluation of the naira, suggesting that the government acted too hastily in devaluing the currency after the removal of fuel subsidies.
Disclosing this in an interview with journalists in Abuja recently, the managing director/chief executive of ID-PETRUS Consult Limited, Idoga Anyebe, said that the removal of fuel subsidies occurred earlier than expected.
According to him, many had anticipated that President Bola Ahmed Tinubu would take time to study the economy thoroughly after his inauguration on 29 May before making that policy statement.
He stated, “To the best of my understanding, it was an error. The President shouldn’t have made those policy statements on 29 May. The statement sent shockwaves throughout Nigeria, causing a rapid increase in fuel prices and creating numerous problems along the way. However, this situation could have been more easily managed because we were already preparing to remove the subsidy in July”.
Addressing the current hardships, particularly the challenges of affording basic food items, Mr. Anyebe emphasised that unless the naira appreciates, the standard of living in the country will continue to deteriorate.
He added, “Before we can devise a solution to the present economic situation, we must understand how we arrived here in the first place. The issue of subsidy removal was generally accepted by the people due to the perceived corruption associated with it. There was a time when we didn’t even know the exact amount the country was paying as a subsidy. We all sincerely wished for the subsidy to be removed, and the President eventually removed it.
“Simply put, they could have studied the subsidy removal to assess potential savings and maintained or sustained the monetary policy until the appointment of the substantive CBN governor. However, they didn’t wait and proceeded to devalue the naira. In my understanding, it’s the devaluation of the naira that has complicated the current situation. Now, the CBN governor has a significant role to play, and the ball is in his court. We’ll see how he handles it”.
