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President Goodluck Jonathan is being asked to revitalise his economic management team, reduce lending rate to a single digit,
In interactions with LEADERSHIP Sunday, the experts noted that the economy recorded modest improvements during the outgoing year They also revealed that the effects of single digit inflation attained in 2013 were yet to be felt by Nigerians.
They want government to pay attention to increasing activities in the real sector. They also expressed concern over government’s moves to check importation, which they fear could reduce public revenue.
The director-general of the West African Institute for Financial and Economic Management, Prof. Akpan Ekpo is of the opinion that the economy did not fare well in 2013 because the country had continued to experience high lending rates which left the real sector in a deplorable state and therefore increased the level of unemployment.
He did not fail to admit that the economy recorded marginal improvement during the year. This was based on a declining inflation rate as well as the privatization of the Power Holding Company of Nigeria (PHCN).
“A country can have high inflation rate and still grow its economy; what the government should focus on is the threshold. It should work on bringing down lending rates. In 2013, the real sector was in comatose and Nigeria cannot do well with high lending rates. The manufacturing sector contributed five per cent to the Gross Domestic Product (GDP) and that to me is unacceptable. We need the real sector to create jobs and bringing down lending rates is central to achieving this,” he stated.
He believes that with the transofrmation of the power sector taking full effect next year, “the economy could bounce back, but the government still needs to bring down lending rates to a single digit. Because I don’t know who would borrow at 24 per cent to start up a factory; you have to make more than that in profit to be able to pay back.”
Ekpo has stressed the need for the government to start planning beyond the oil sector by diversifying the economy, adding that the quality of the leadership structure also needs to change in 2014. While lauding President Jonathan’s transformation agenda, he urged him to look at those helping him to ascertain how committed they are to growing the economy.
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