This question is prompted by people who kept asking for economic policy and/or direction of this government before they can do anything in this trying times that Nigerians find ourselves.
To my understanding, Economic policy simply means what government does or plans to do in the economic sphere: on taxation, budgets, money supply, currency & interest rates, labor & employment, privatization, and other areas of government interventions into the economy.
The current government has shown its hands on most of these matters: It is hesitant or doesn’t want to devalue the Naira or as some prefer, liberalize the FX market; it has tightened forex access partly to discourage imports and drive its production agenda and partly because, it is broke; it favors local production over imports and targets exports; it seeks diversification from oil, and to expand the agriculture and solid mineral sectors; it plans to generate employment through massive infrastructure projects and to reduce poverty by a palliative N5k stipend to the poor; it may increase tax or introduce new ones; it seeks to and is already shoring up its accounts by recovering looted public funds, while also blocking revenue loopholes through the TSA; and it promises to further tighten government finances through cuts in wasteful expenditure and the anti-graft war, etc.
We can debate the merits and/or soundness of these policy thrusts, or whether they have been consistently applied or whether they have the intended salutary or adverse effects on the economy and the citizenry.
As an entrepreneur in value-added IT/Telecom systems integration and provisioning among other services, my interest in the economic policy revolves around how my biz is affected. I now have serious challenges with procurement of OEM equipment and services. An appropriate response must factor my clearly reduced FX access into my plans for this fiscal year and beyond.
Do my opportunities justify the new cost of my inputs? Do I have the clout to access FX at official rate? If not, will I remain competitive if I source from the black market? Aside from the difficulty of accessing FX at official rate and in time for my delivery schedules, what other threats must I confront? Do I have to reduce my margins? Should I diversify? Or should I even consider another biz line entirely? These are questions I must answer after scanning the economic space in which I operate. Only this way will I remain relevant or crash out. This determines whether I thrive or sustain or starve.
Economic policy is not a magic manual that government publishes, shares and hires tutors to teach citizens. To me, this government’s economic direction is lean and mean. You either get it or you don’t and/or are insincere or indolent to accept it and make necessary adjustments to mitigate how it affects you.
This is the only way to guarantee our financial security in the current economic stagflation.
Suleiman is the MD/CEO, NetMatrix Ltd, an IT/Telecoms expert and entrepreneur, is passionate about entrepreneurship development as a vehicle for reducing poverty in Nigeria and beyond.He is on the board of SECURITY MONITOR and a guest columnist. FEEDBACK-08036692165 (SMS only, please