Virtual Conference With Pastor Oyemade At The 2020 Edition Of The Platform Nigeria On 02/05/2020

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Video Transcript

VP Osinbajo – Q and A at The Platform – 2^nd May 2020

Q – Given the challenges with getting palliative to the last man in Nigeria, is the government considering a readjustment to the National Identity scheme so that all Nigerians can be accounted for going forward?

A – I think one of the great silver linings in this pandemic cloud is the fact that we must do something about data and ramp up what we are doing already. We are a bit further up than imagined. When we were instituting the SIPs, especially TraderMoni and MarketMoni, one thing we did was the remuneration of petty/street traders which we did with Nigerian startups. They did the enumeration, verification, installed the payment systems and did an excellent job.

These are young Nigerians who we used to generate information on over 4 million traders. We are at a point where it is demonstrated that by using local resources, locally developed technology, it is possible for us to enumerate accurately practically every Nigerian. This 4million feat was achieved in a period of under 3 months. It is possible for us to get the digital data, the thumbprint data and capturing. This has shown the tremendous possibilities and we are ramping that up.

The Minister of Humanitarian Affairs has been doing quite a bit of work in that respect. One of the things she has been doing is trying to ramp up enumeration all over the country with the assistance of NIMC and Ministry of Communications and Digital Technology. I believe this is comparable to the scheme in India which remunerated over 1.2billion people.  Technology has made it possible and we have the local capacity to do so which makes it more exciting for me.

Q – Looking at the oil price shocks, will this be looked into in restructuring the Nigerian economy going forward?

A – There’s no way of over-emphasizing a difficult situation that we are in if we assumed that oil would be over $60 and we find ourselves selling oil at 13$, that presents a significant challenge.

It means pressure on our external reserves, in funding and financing our capital projects and recurrent spending. It also means support for states and State allocations are at risks.

I must emphasize that the challenges present significant opportunities that could permanently turn around our economic fortunes for good as a nation.

Mr President has done a number of things. First was, he constituted a meeting of principal ministers concerned with the economy and thereafter, he set up the Economy Sustainability Committee which looks at what to do during and post Covid-19 and what sorts of economic plans may be required in order to weather the storm. What we must do are two crucial things, speaking broadly: 1) focus on the use of our local resources 2) decent job creation.

Focusing on Local Resources as part of thinking through planning during this period:

1)      Look at our building of roads. We have to import bitumen. Now that there may not be that space to import, but we are a major limestone resource country. We are net exporters of cement and rather than use imported bitumen, we can focus on the use of limestone. Through local resources, we can build concrete roads. Dangote’s road from Apapa to tollgate in Lagos is a concrete road.

We can also use our natural resources to fund our housing deficit, with a lot of the materials presently being imported, we can, going forward, build using local resources. Looking at our mass housing scheme, states can give up land for building low-cost mass housing.

Using Kano as an example, the state gives 10,000 hectares of land for housing, we ask that local artisans in Kano who make windows, doors, mould blocks and others involved in all other components of building, are engaged on-site using our local materials. This way we can provide jobs, we can also provide opportunities for builders, architects and civil engineers.

Using our online resources, we were able to engage 500,000 young men and women into our N-Power scheme.  We can use the same online platforms to ask Nigerians who have set up little companies such as construction companies made up of architects and engineers and get them to bid for the building of these houses.

In Kano, for example, we may have 100 companies bidding for those houses and of course, we would look at quality control. What that provides is several hundred thousands of jobs and then we look at our government can purchase these houses as a last resort. Govt takes the role of buying the houses through mortgage banks and then gives out the mortgages.  We can have the police force, civil servants and private sector businesses, purchasing thousands of these houses for their use for staffs. This is an example of using local resources to create jobs.

AGRICULTURE AND THE ENTIRE VALUE CHAIN

We have seen that not only do we reduce our dependence on imported food, which means dependence on foreign exchange, when we ramp up local agriculture, it also means that we are able to provide local jobs rather than exporting those local jobs to countries that supply all basic food items we have.

Using a massive agricultural scheme in consultation with the Ministry of Agriculture, CBN, NISRAL and several important government agencies and with the private sector, we can ramp up smallholder agriculture. Each State providing hectarage used for agriculture and with the Federal Government working with Private Sector providing inputs such as seedlings, fertilizers for each of these smallholder farms. These smallholder farm working with private out-growers – many of these out growers have shown tremendous success with their farms like Olam Farms and several others.

What we intend to do is to leverage those successes and create more hectarage with the collaboration of the States and Private Sector. So, we can bring in hundreds of thousands of more individuals into farming.

We must improve the value chain – processing and storage will require a lot of investment and the private sector can be brought in to take advantage.

We have found out that the way to go is to leverage on agriculture, provide jobs in agriculture and reduce food imports.

This has dropped, we were spending something in the order of $16b as of 2016/2017, as at 2018 that had dropped to about $10.9b or so, and dropped further and it is bound to drop more in the next couple of years.

Local food production, building up the value chain, developing rural roads for transportation, using limestone, we can achieve significant improvement in our facilities and our abilities to cope with the pandemic.

Development of SMEs is also important and there are so many initiatives around that as well. Very many young Nigerians businesses can benefit from some of what the FG is looking at doing in collaboration with the States and Private Sector, especially with providing funding/Investment opportunities for SMEs which they can take advantage of. Looking at payroll support for MSMEs, and trying to see how we can create fresh opportunities for MSMEs.

We mustn’t pass on this opportunity, we must do as much as we can, to change the narrative of the Nigerian economy, provide more jobs and opportunities for our people. This is something we can do with the support of all the different sectors, private and public.

Q – Does the government have any plan to slow down the inflation rate due to naira devaluation?

A –

With respect to inflation, you’d appreciate that there’s always the tension between inflation and growth. Thinking through our economic policy at this time, if we are going to spur growth, especially with increased FG spending, domestic expenditure, we would have to make room for some inflation.

It is important in my view to increase productivity in Nigeria, because we have the human and material resources to do so. Increasing the stock of goods is an important part of ensuring that we have the goods. Productivity is our focus. Now looking at food production, if we can ramp it up, ramp up our logistics of bringing food especially to the urban areas, we will be able to significantly control inflation.

If we can provide jobs, this can increase value created, productivity and ultimately reduce inflation threats.

We are also very conscious that we do not lapse into a situation whereby because of the fall in the value of the naira, we find ourselves with incomplete projects because of the foreign exchange components of those projects.

One thing we are doing is ensure that our foreign exchange funding component is protected – this is funding for specific infrastructure. And it is important we complete our infrastructure; hence we are restricting the use of our foreign exchange to the very productive purpose of completing infrastructure for our capital projects – power, rail, roads. Allocating our resources in such a way that we do not jeopardize our infrastructure projects.

Another point that can be made is that if we are careful enough, especially with our fiscal measures, we can be able to ramp up our foreign exchange earnings, especially through export of our food items. There’s a great deal of demand for food, while we are thinking of local production, there’s also demand significant opportunities for exports.

In mining, we can also ramp up foreign exchange earnings through export of our solid minerals.

We have made a few attempts at concessional borrowing which will help with the deficits we have at the moment in our foreign reserve earnings.

The loans from IMF and World Bank, AFDB, these will shore up our FX reserves for the short-medium term while we carry out the above to ramp up earnings in the long-term. We encourage our people to co-operate with the government to curb the spread so we can get through this much stronger economically and as a people.

I am very confident that Nigerians, with our resilience, our strength and our innovation, we will go through this in great shape.