Experts commend Tinubu on economic reforms, proffer inflation solutions

Some financial experts on Monday commended the economic reforms outlined by President Bola Tinubu in his Sunday broadcast, while offering solutions to tame inflation in the country.

They were responding to the president’s address in an interview with the News Agency of Nigeria (NAN) on Monday in Lagos.

 

The president’s broadcast was to douse the tension of the #EndBadGovernance protests that erupted across the country since Aug.1 to demand sufficient food and end corruption, among others.

 

NAN reports that the protesters had vowed to embark on the protest until Aug.10 if their demands were not met.

 

Reacting, Mr. Tajudeen Olayinka, an Investment banker, said that the president’s address indicated that he was not ready to trade away his lofty ideas concerning ongoing economic reforms, amid the protest.

 

Olayinka explained that Tinubu believed that his policies were meant to address the fundamental flaws in the mismanagement of Nigeria’s economy in the past.

 

According to him, this, many believe is responsible for current challenges in the economy.

 

The stockbroker said that most of the demands from the protesters were not well thought through.

 

According to him, this is because the president has already taken some short-term measures to address the food crisis and high inflationary pressure a few weeks before the commencement of the protest.

 

On the impact the president’s speech would have on investment, Olayinka predicted that both local and foreign investors would react positively.

 

He said this was because investors were willing to know how consistent the policy environment would be in Nigeria.

 

“The president has demonstrated that his current economic policies are necessary and will be pursued vigorously to restore stability and economic growth.

 

“I think people should just be patient with the government to see how best they can address the current socio-economic challenges bedeviling the country,” he said.

 

The stockbroker, however, charged the president to shop for economic experts in the area of adjustment programmes, to help redesign and drive his economic policies and programmes.

 

He noted that this was necessary because the adjustment programme was the most complex programme in macroeconomic management.

 

Commenting, Mr. David Adonri, Vice Chairman, Highcap Securities, said that an important takeaway from President Tinubu’s address was his unwavering commitment to market reforms, adding that this would delight investors.

 

Adonri, however, said that the president’s market policy of imposing a heavy tax on banks’ foreign exchange windfall could erode investors’ confidence.

 

He explained that several achievements and efforts made in revamping the economy were reeled out by the president.

 

These, he noted included a reduction in the debt servicing ratio and support for agriculture, but the critical issue of farm insecurity beneath the food crisis was not mentioned.

 

Adonri stated that investors would have been happier if the president had highlighted his new strategy for eradicating the menace of banditry and terrorism since the current strategy was ineffective.

 

He said: “Investors are very sensitive to the safety of their investments before thinking of profitability and liquidity.

 

“In addition to the achievements on the economic front mentioned by the president.

 

“To jumpstart the economy, the demand management strategy of tightening money supply needs to be complimented with the tightening of fiscal spending, diversion of the nation’s public and private resources to foundational production infrastructure.”

 

According to the stockbroker, this will close the huge supply gap that is dislocating the economy in spite of the laudable objectives behind market reform.

 

For a better society

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