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‘Recession persists till govt gets people out of poverty’

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Despite being technically out of recession, Nigeria remains in economic conundrum till the government gets people out of poverty. An Islamic scholar, Alhaji Ahmed ‘Tunde Popoola, FCA, said this in a paper at an event organized by the Nigerian Supreme Council for Islamic Affairs (NSCIA), that the government needs to go back to address the building blocks of sustainable, inclusive and rapid economic growth and development. “As we discuss the management of our economy, it will not be out of place to benchmark our performance against the objectives spelt out in our Constitution, though we know it’s a journey.

The statistics point to the fact that, given all the circumstances, we could do far better. “Now that we are officially out of recession with a fragile GDP growth of 0.55% in quarter 2, 2017 we need to go back to address the building blocks of sustainable, inclusive and rapid economic growth and development.

We need to get people out of poverty; we need to get people to work again by creating jobs,” he said. “As the government formulates plans and policies to grow the economy on a path of inclusiveness and sustainability after the recession, there is a lot to adopt from Islamic economics and principles.

The primary objectives of Islamic principles and economic system are equitable distribution of wealth and social justice. “Islamic fiscal policy is used to achieve the objectives of economic stability, growth and acceptable distribution of wealth. Islam establishes a high degree of economic equality and conscious avoidance of wealth concentration. Secondly, since Islam prohibits payment of interest on loans, it implies that interest rate cannot be manipulated or become the instrument to achieve equilibrium in the money market.

Islamic economic principles can help and they are worth considering in the following areas: Providing and funding public infrastructure; Promoting free enterprise – SMEs and agriculture; Financial inclusion and social safety nets; Tackling corruption, and Human capital development.” Nigeria, according to Popoola, needs to increase and improve productivity.

“There is the need to mitigate foreign exchange shortfalls and stabilize the foreign exchange rate. We need to provide the required infrastructure and close the gap in infrastructure deficiency. Businesses need to get back to business. The economy requires to be stimulated. In other words, we need to set the agenda for inclusive growth and development.

“Diversification of the economy as a solution has almost become a slogan by government after government, but most past governments did not surmount the political will to implement the very fantastic and laudable plans they always put together and unveil. Since my days as an undergraduate in Economics, we as a nation have always talked about structural imbalance, heavy dependence on oil, need to promote exports, import substitution strategy, export-led growth, etc.

However, a review of our earnings and the composition of the sectoral contributions to the economy/ national budget by revenues, reveals that the contribution from oil remain as high as ever,” he said. Managing a post-recession economy, he continued, requires taking bold and coherent fiscal and monetary policy measures and putting the right people at the helm of affairs.

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