This Day (Lagos)

Nigeria: Okonjo-Iweala - Economy Is in Danger Without Jobs

The Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, has warned that the Nigerian economy may be in a precarious situation if the private sector does not join hands with government to create jobs and reduce inequality in the country.

Okonjo-Iweala who made this known Monday at a breakfast dialogue in Lagos, tagged: "The State of the Nigerian Economy in 2013," organised by the Nigerian Economic Summit Group (NESG), also warned that the politicisation of Nigeria's budgeting process would not help the country.

The minister, who accused the private sector of creating wealth for a few and not jobs, disclosed that the federal government created a total of 1.6 million jobs in 2012 and another 431, 000 jobs in the first quarter of 2013.

This, she added, showed an improved trend of job creation and increase of 11.69 per cent over the level in the fourth quarter of 2012.

The minister who hailed the government's economic policies, stated that without the microeconomic stability there could be no jobs, adding that the government would continue to pursue microeconomic stability so that companies could plan.

According to her, "The quality of growth in the economy needs to improve; we are not creating enough jobs. We need to grow faster in job creating sectors at between 10 per cent per annum to create jobs needed to substantially reduce poverty in the country. The inequality in the country is growing faster and the growth in the economy is not inclusive.

"If the private sector does not create jobs, the economy will be in danger. Only the top 10 of Nigerians are enjoying most of the growth in the economy unlike what is obtainable in the United States of America. We also very importantly need to take care of regional disparity and carry every region of the country along."

On the budget, Okonjo-Iweala, said: "Budget is becoming more politicised these days. This should not be. Other countries have independent boards with professionals that determine benchmarks and prices. We cannot continue to subject a fundamental policy instrument to politics."

To tackle the inequality challenge and address other problems facing the country, the federal government, she said, had taken steps to remove structural bottlenecks, improve business climate, reduce bureaucracy and fight corruption.

The federal government, she added, had also formulated supportive policies for structural growth in agriculture, housing, manufacturing, creative industry and oil and gas sectors of the economy.

The finance minister added that the federal government had built safety nets to assist vulnerable women, children, and the disabled stressing that the government would continue to pursue these measures in 2014.

Speaking on government's plan for 2014, Okonjo-Iweala stated that despite pressure from several quarters, the government would maintain its strict fiscal measures and try to make sure 2014 remains a very stable year ahead of the 2015 election spending.

"The government in partnership with the KFW of Germany, IMF and the World Bank will create a development bank in 2014. This bank will enable the private sector to borrow money for a 10-year period at reasonable interest rates. The federal government will also privatise the Bank of Industry (BoI) and the Bank of Agriculture (BoA) next year and restructure them to be specialised banks in 2014. We expect to continue the strong drive in agriculture in 2014; we are also going to support the manufacturing, consumer goods and the petrochemical sectors to create jobs," she said.

She also noted that contrary to insinuations, the government did not plan to increase tax rates but making effort to increase non-oil revenue by ensuring that registered businesses pay their taxes.

Besides, she disclosed that the federal government had concluded arrangement to review tax holidays in the country as they are been abused by beneficiaries.

In a related development, the Chairman, Senate Committee on Environment and Ecology, Senator Bukola Saraki, has urged the federal government to declare a state of emergency on unemployment among youths in the country.

Saraki, who represents Kwara Central senatorial district in at the National Assembly, stated this in Ilorin yesterday, at a one-day technical summit for unemployed youths in Kwara State entitled: 'Youths Unemployment in Kwara State, The Way Forward'.

According to him, "Despite all the persisting unemployment problem, there s much we can do and we need to take our destiny in our hands and proffer solutions because the boys and girls that are unemployed are Nigerians."

He said: "There is every need to extend the declaration of state of emergency to youths' unemployment. We have done it in the power and water sectors among others and it has worked out well."

Saraki, who is also the immediate past governor of Kwara State, said: "According to the National Population Commission (NPC), youths account for 65 per cent of the Nigerian population and 23.9 per cent of the unemployment rate in Nigeria.

"In comparison to other countries like Brazil, which has a working population of over 130 million and unemployment rate of around 14 per cent and South Africa with a population of over 52 million has unemployment of almost 40 per cent. "In Kwara State, the current unemployment rate is nine per cent, the second lowest in the country. There cannot be any stability, peaceful environment and prosperity of any sort with this level of youth unemployment."

The lawmaker, however, emphasised on entrepreneurship promotion as the new trend particularly to address the challenges related to alarming high youth unemployment rate.

Saraki said: "It also offers pathways for young people to overcome the problem of unemployment. I am of the view that special attention must paid to social entrepreneurship mode which should be infused in the real economy closer to the youth within local environment."

Sokoto State office of the Independent Corrupt Practices and Other Related Offences Commission (ICPC), yesterday attributed the high rate of poverty and unemployment in the country to corruption.

The ICPC also disclosed that investigated 28 cases and secured two convictions in the state in 2013.

Head of ICPC in the state, Mahdi Muhammad Lawal, who made the disclosure, at the commemoration of the World Anti-Corruption Day in Sokoto, decried that corruption was evident in all facet of life in this country, which clearly indicated the way wealth was being concentrated in the hands of few individuals at the expense of majority wallowing in poverty.

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