Nigeria is Technically in a Recession - Finance Minister, Adeosun Reveals as She Appears Before Senate

 

While fielding questions from Nigerian Senators on the state of the nation's economy on Thursday, the Minister of Finance, Kemi Adeosun, has revealed that Nigeria is “technically in a recession”.

 

The minister disclosed that Goodluck Jonathan's administration did not adequately tackle the economic challenges faced by the country.

“Are we in recession? Technically, yes we are. The previous administration was borrowing to pay salaries. We were taking panadol when we had cancer,” she said. 

 

“Technically, Nigeria is in recession but we should not go into definition; but what we are doing? We should not be worried about IMF. We should be confident about what we are doing.

 

“Things are tough, but we are not ignorant. I want to assure Nigerians the economy is in good hands and we are absolutely doing our best. We want to assure Nigeria we are on the right path, we are on the right track.”

 

To revive the economy, she said the government had devised strategic measures, chief of which is discipline regarding how public money is spent.

 

She said by “cleaning” spending, cost of salaries had been reduced from N165 billion to N159 billion, and that capital-recurrent expenditure ratio had been restructured to 30:70 “compared to previously when recurrent expenditure was 90 per cent and capital expenditure 10 per cent”.

 

“We are declaring war on wastes,” she said, disclosing the government had stopped funding nonessential items. "The objective is to release money for capital expenditure to get the economy going.”

 

Mrs. Adeosun’s assurance came four days after the National Bureau of Statistics said the Consumer Price Index used in measuring inflation in the country hit 16.5 percent, the highest in 11 years.

 

It also came after the International Monetary Fund (IMF) said Nigeria’s economy was projected to contract in 2016. It cut the country’s GDP growth forecast from 2.3 percent in April to – 1.8 percent, lowest in 29 years.

 

While disagreeing with senators that the President Muhammadu Buhari-led federal government does not have an economic plan, she said the government is not immune to the sufferings of Nigerians, as it is doing all to alleviate their sufferings.

 

The minister also revealed that federal government saves N6billion monthly through a cut down in recurrent expenditure.

 

She told the lawmakers at plenary that the move is part of federal government’s effort towards ensuring fiscal discipline in the face of dwindling oil revenues.

 

According to her, the government now spends N159 billion instead of N165 billion previously spent monthly as recurrent expenditure.