The Senate has invited the Minister of Finance, Mrs Kemi Adeosun, and the CBN Governor, Mr Godwin Emefiele, to brief the upper chamber on the monetary and fiscal policies they have adopted to shape up the economy.
The upper legislative chamber adopted a resolution to invite custodians of the economy on Wednesday, following a motion by Sen. Bassey Akpan (Akwa Ibom North-East), seeking solutions to the nation’s troubled economy.
Akpan, who is also the Chairman of the Senate Committee on Gas, said a report by the National Bureau of Statistics had shown drastic drop in the economy and the Gross Domestic Product (GDP).
He said that from the report, unemployment rate had risen to 12.1 per cent in the first quarter of 2016 from 10.4 per cent in the last quarter of 2015.
“The declining GDP and unemployment, besides the current high inflation rate, clearly show that the economic policies are not achieving desired impact and require an urgent review.
“The current economic contraction is the first major drastic slump since June 2004, which according to the CBN is a 12-year-low, while the World Bank position is that it is a 21-year-low.
“The CBN had in March 2016 deployed a contracting monetary policy increasing benchmark interest rate from 11 per cent to 12 per cent and cash reserve ratio from 20 per cent to 22.5 per cent.
“The question is, why contracting monetary policy instead of expansionary monetary policy of boosting economic activities at such a critical time as this,” he said.
He expressed worry that if the economy was allowed to plummet, it would set the tone for a full blown economic recession by the end of next month.
Akpan said that it was, therefore, pertinent for the nation to have an economic direction so that the economic situation would not worsen.
The senator also expressed worry over the decline in oil production by 800,000 barrels per day owing to vandalism of pipelines and the inability of revenue generating agencies to meet their target.
“With the economic slump, meeting the key budgetary revenue projections of the 2016 budget is practically impossible, he said.
While seconding the motion, the Deputy Minority Whip of the Senate, Biodun Olujimi, said there was no visible economic policy in Nigeria.
She said the CBN governor and the finance minister should also come with an economic blueprint and mode of implementing palliatives in view of the new price of petrol.