A former Deputy Governor of the Central Bank of Nigeria (CBN), Prof. Kingsley Chiedu Moghalu, has advised global economic players, investors and capital allocators not to fret over Nigeria’s delayed cabinet appointments.
Moghalu stated this in a report titled: “ Why Nigeria’s Economic Horizon Will Clear,” obtained at the weekend. He explained that when Buhari and his government settle into their stride in the fourth quarter of 2015.
In an article published in the Official Monetary and Financial Institutions Forum (OMFIF) bulletin. Moghalu who is currently a member of the Advisory Board of the OMFIF, a London-based network of some of the world’s largest asset management, investment firms, central banks and economic policymakers said :
“Foreign investors and many Nigerians had been impatient with President Buhari’s delay in appointing a cabinet since his inauguration on May 29. But the president recently gave a timeframe of September to name his ministers.
“Yet these delays have had an effect on business confidence. The absence of a fiscal policy framework makes planning difficult in an economy in which government plays a major role. Monetary policy lacks the context of fiscal spending plans. However, beyond the reasons Buhari has publicly articulated, there are other dynamics at play.
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“The most important is that the Nigerian leader, despite coming to power on a democratic political platform, simply does not trust Nigeria’s professional politicians. He is determined that the usual political horse-trading should not undermine his vision of governance or his authority as head of government.
“Under pressure from individuals and vested interests with a predilection for public office and its privileges, Buhari was wise to apply the brakes and take control of his leadership selection process. After all, he will take the political responsibility for the team’s success or failure,” the former CBN deputy governor explained.
According to him, Buhari might have moved more quickly had it not been for an internal crisis in his party -the All Progressives Congress, over leadership positions in the country’s parliament.
However, he pointed out the president Buhari still has to outline his broad economic policy direction, adding that his officials have to frame policy options and convince him of their respective merits.
“It is an open question whether Buhari will agree to abolish inefficient petroleum subsidies that have placed much pressure on fiscal resources. From the perspective of economic efficiency, he should do this – and then transfer the savings to clearly measurable social programme so as to navigate the political sensitivities of such reform.
“Buhari is open to increased foreign investment. But he will also favour industrial policies aimed at developing home-grown manufacturing and a welfare approach to extreme poverty. He will wish to increase capital spending to spur qualitative economic growth in a country where recurrent spending to sustain a bloated government apparatus has reached 90 per cent of the budget. Despite the Buhari government’s slow start, an investment bet on Nigeria remains a good one in the medium to longer term,” he added.
