A quick glimpse reveals the following: While the Buhari administration shared allocations by way of illustration for January 2023, 1.4 trillion, February, 1.03 trillion; March, 2023 860.04 billion; April 2023, 872.55 billion, May 2023 976.34 billion, the current Tinubu administration has distributed so far the following amounts: June 2023, 1.134 trillion, July 2023, 1.89 trillion, August 2023, 1.80 trillion, September 2023, 1.48 trillion, October 2023, 1.59 trillion, November 2023, 1.35 trillion, December 2023, 1.62 trillion, January 2024 1.67 trillion, and February 2.07 trillion. The Sun writes
From these statistics, it is clear that distributable revenue among the levels of government has been on the rise since the inception of this administration, primarily due to the oil subsidy removal, and consistently, in trillions.
To a large extent, this could be seen as a positive development but with negative implications for the economy and the people. Despite the release of huge sums into the economy, Nigerians are still unable to feel the impact of these funds in their daily lives. In fact, if there is any noticeable impact of the disbursements on Nigerians, it is negative, in the sense of engendering inflation in the country.
The further multiplier effect of the continuous release of such large accruable revenue into the economy is the mounting pressure on the local currency, the naira.
One might have thought that such releases would positively impact the economy through improved welfare for Nigerians via investments in infrastructure and job creation. Alas, this is far from being the case.
Rather than positively impacting the economy, these releases are actually destroying and impairing economic growth. Most state actors into whose possession the large funds come, instead of utilizing the funds appropriately, are misapplying them in a manner detrimental to the health of the economy.
It is bad enough to misappropriate the funds, but worse still, these funds are often not made to work for the economy but are instead kept idle or exported. Truth be told, most of the funds, upon conversion to foreign currency, are often stored outside the financial system, where they could be working for the country.
As the government continues releasing huge naira sums, pressure mounts on the few available foreign currencies, for which the corrupt leaders have developed a huge appetite. Applying the law of supply and demand, it’s no rocket science that the exchange rate for foreign currencies will continue to skyrocket.
Similarly, the huge naira amounts are chasing the few available commodities, thus compelling spikes and hikes in the prices of goods. These are the concomitant effects of releasing such huge sums into the economy. As is known today, the Central Bank of Nigeria, under the able leadership of the incorruptible Yemi Cardoso, is doing much to defend the naira. Mr. Cardoso came at a challenging time when the CBN, rather than being the stabilizer of the economy, had become a source of economic instability.
A quick glimpse reveals the following: While the Buhari administration shared allocations by way of illustration for January 2023, 1.4 trillion, February, 1.03 trillion; March, 2023 860.04 billion; April 2023, 872.55 billion, May 2023 976.34 billion, the current Tinubu administration has distributed so far the following amounts: June 2023, 1.134 trillion, July 2023, 1.89 trillion, August 2023, 1.80 trillion, September 2023, 1.48 trillion, October 2023, 1.59 trillion, November 2023, 1.35 trillion, December 2023, 1.62 trillion, January 2024 1.67 trillion, and February 2.07 trillion.
From these statistics, it is clear that distributable revenue among the levels of government has been on the rise since the inception of this administration, primarily due to the oil subsidy removal, and consistently, in trillions.
To a large extent, this could be seen as a positive development but with negative implications for the economy and the people. Despite the release of huge sums into the economy, Nigerians are still unable to feel the impact of these funds in their daily lives.
In fact, if there is any noticeable impact of the disbursements on Nigerians, it is negative, in the sense of engendering inflation in the country. The further multiplier effect of the continuous release of such large accruable revenue into the economy is the mounting pressure on the local currency, the naira.
One might have thought that such releases would positively impact the economy through improved welfare for Nigerians via investments in infrastructure and job creation. Alas, this is far from being the case. Rather than positively impacting the economy, these releases are actually destroying and impairing economic growth.
Most state actors into whose possession the large funds come, instead of utilizing the funds appropriately, are misapplying them in a manner detrimental to the health of the economy. It is bad enough to misappropriate the funds, but worse still, these funds are often not made to work for the economy but are instead kept idle or exported.
Truth be told, most of the funds, upon conversion to foreign currency, are often stored outside the financial system, where they could be working for the country. As the government continues releasing huge naira sums, pressure mounts on the few available foreign currencies, for which the corrupt leaders have developed a huge appetite.
Applying the law of supply and demand, it’s no rocket science that the exchange rate for foreign currencies will continue to skyrocket. Similarly, the huge naira amounts are chasing the few available commodities, thus compelling spikes and hikes in the prices of goods. These are the concomitant effects of releasing such huge sums into the economy.
As is known today, the Central Bank of Nigeria, under the able leadership of the incorruptible Yemi Cardoso, is doing much to defend the naira. Mr. Cardoso came at a challenging time when the CBN, rather than being the stabilizer of the economy, had become a source of economic instability.
