Nigerians are keenly aware that President Bola Tinubu’s recent trip to China is aimed at securing loans, a move that has prompted warnings from experts to be cautious in negotiations with China and other international lenders.
This comes as the country grapples with severe economic hardship, marked by soaring inflation and rising costs of living.
African Development Activist, Professor Anthony Chibo, and economist Chijioke Okechukwu, have urged President Tinubu to prioritize the welfare of Nigerians during his bargaining with China, the World Bank, and the International Monetary Fund. Their concerns are heightened by the economic challenges faced by Nigerians, including escalated prices of Premium Motor Spirit (PMS), increased electricity tariffs, and a floated currency, all of which have contributed to a spike in the cost of living.
Inflation in Nigeria has surged to 33.4% in July, with PMS prices exceeding N800 per litre under the current administration. These economic pressures, coupled with insecurity issues, have exacerbated the hardship faced by the population.
Last week, President Tinubu attended the 2024 Forum on China-Africa Cooperation (FOCAC) in Beijing, where he sought to attract investors to Nigeria. However, economists like Okechukwu caution that the government must be meticulous in its negotiations with China and the IMF to ensure that any agreements favor the Nigerian people.
Okechukwu emphasized, “When we listen to the IMF and the World Bank, they don’t consider the people. What they consider is whether the country will be able to repay its debt. They say let us give them the conditions that will make them pay us back our money when due. The people are not their concern.”
He further noted that China’s investments in Africa, including the recent pledge of $50 billion, are often tied to specific targets and conditions that may not necessarily benefit the local economy. “Most of the investments they will do in Nigeria will be done by their construction companies, their banks will handle the transactions, and these monies will still go back to them,” Okechukwu explained.
Professor Chibo also highlighted the need for fiscal discipline within the Nigerian government. He suggested reducing the size and cost of government operations, including slashing allowances to public officers by 50%. This, he argued, could save trillions of naira that could be channeled into the economy to alleviate the sufferings of the people.
Chibo stated, “What if all government allowances to public officers were slashed by 50 per cent? The size and the cost of government by 50 per cent. That means, not the salaries because no government person lives on salary. Their allowances and expenditure just cut everything. When you do that, you won’t believe the amount of money that will be saved.”
These warnings underscore the critical need for careful consideration and strategic planning in Nigeria’s economic dealings with international partners, particularly as the country seeks to navigate its current economic challenges
