Former Emir of Kano and Grand Khalifa Tijjaniyya Nigeria, Muhammad Sanusi II, has stressed the role politics and governance play in the economic outcome of a nation.

He spoke, yesterday, at the Nigerian Institute of International Affairs (NIIA) Distinguished Lecture Series, themed, ‘Resetting the Nigerian Economy for a Brighter Future,’ in Lagos.

According to him, economy is run on the basis of ideological orientation of those who control the state.

He said: “I think every economist knew that multiple exchange rates were a problem. And every economist said it, but so long as politicians are able to give themselves dollars at N400 and sell at N700, they were not ready to listen to the economists.
“People talk about fuel subsidies as far back as 2011. We said, if we did not do something about those subsidies, we would end up where we are today. It took 11 years.

“The subsidies we had were not even subsidies. Even the structure of the fuel subsidy in Nigeria was the worst possible structure for any government’s balance sheet in finance. What the Federal Government said was, we would fix the price of petrol. This is a product, which price we did not control. It is a commodity traded on the international market.

“Every time the price of oil, exchange rates or interest rates moved, the difference went straight to the government’s balance sheets for 200 million Nigerians. And the government itself had no backup. It was an unsustainable model,” he said.

Sanusi, who is also a former governor, Central Bank of Nigeria (CBN), said as much as it’s easy to blame politicians, civil societies are equally guilty as these institutions did little to stop the current decadence in the society.

According to him, the second important factor is the governance of the economy as having the right qualified people in charge of institutions has a positive impact on economic decisions.

“We have 48 ministers, but how many economists are in that list,” he asked.
Saying that one of the solutions to Nigeria’s fiscal woes is to raise revenues, he noted that unless the nation’s fiscal policy is addressed urgently, it might be in the same situation as Ghana.

Director General, NIIA, Eghosa Osaghae, stressed on the need for Nigeria to regenerate its productive capacity, become a manufacturing nation, make optimal use of African Continental Free Trade Area (AfCfTA) to establish the nation as the first in the continent and beyond.