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Social realities and IMF’s growth forecast

For years now, Nigeria has remained one country that frequently defies most sociopolitical predictions and economic projections, especially when they tend to be negative. At the point the polity is assumed to be hitting the precipice, it turns 360 degrees to prove such forecasts wrong.

How long this luck will last is for now beyond the conjecture of everyone. However, even as mother nature has been kind to us, not allowing in-depth catastrophe to befall the country, it is most appropriate for now to allow wisdom prevail and not assuming that the ills would continually heal on their own. Good enough, the socio-economic environment has been quite tolerant in this regard.

Despite the high rate of insecurity and deplorable standard of living, to a large extent, experts still foresee the best for the country. While the dust of celebrating the Q4’20 exit from economic recession is yet to settle, one of the Brenton Wood institutions, the International Monetary Fund (IMF), has again surprisingly raised the country’s 2021 Gross Domestic Product (GDP) growth forecast from one per cent it predicted in January to 2.5 per cent. Obviously, this again portrays the resilient nature of not just Nigerians as a people but the deep economic potency and potential of the nation as a whole.

In the first instance, experts had, last year, projected that due to the impact of coronavirus economic lockdown, weak economic indices and sharp drop in oil prices at the international market, the economy would begin to take shape from the second quarter of this year. Surprisingly, however, we witnessed a sudden turnaround as the economy made its exit from the stranglehold during the last months of 2020.

The feat was largely attributed to the role played by the Central Bank of Nigeria (CBN), especially with regards to financial interventions and moratorium. While we revel on the series of success stories, projection and struggle amid insecurity that is sweeping across the country, we must also hold on to the fact that ominous times are staring us in the face and the bubble is likely to burst soon. One thing that must be borne in mind in this regard is that the growth projection by IMF is not going to happen in isolation.

A lot of positive socio-economic factors are compulsorily going to play out if the prediction is to come through. Apparently, the prevailing atmosphere since the beginning of the year does not suggest that the Federal Government is prepared for the growth forecast to come through. With institutions protesting and going on strike over memorandum of understanding with government not being implemented, it is obvious that things are likely to go otherwise if the situation is not fully arrested by the end of the second quarter. Since the beginning of the year, it has been tales of one disruption after another.

The series of events that have taken place during the period remain pointers to the fact that the socio-economic space still deserves positive attention from the government. With the coronavirus experience of most part of last year dealing a great blow on the economy followed by large scale job losses, the first quarter of 2021 was expected to be a healing period for the economy and the workforce. Amid insecurity that appears to have overwhelmed the government, unemployment has continued to grow in leaps and bounds despite the much government feels it has done to stabilise the atmosphere.

The unemployment reality was made clearer in February when the National Bureau of Statistics (NBS) released its report, putting the figure at over 33 per cent from the previous 27 per cent rate. The report, therefore, placed Nigeria among top 20 countries with the highest unemployment rate in the world, making the country the second highest among countries monitored during the period.

The ranking makes Nigeria’s unemployment rate higher than that of Palestine’s West Bank, which in January 1, 2020 occupied the 20th position on the global unemployment ladder with 27.9 per cent, a rate that decreased to 23.40 per cent in the third quarter of 2020.

The increase in unemployment rate has largely been attributed to the after-effect of the COVID-19 induced lockdown, which caused many organisations to reduce their workforce as a means to cope amidst the pandemic. Even though businesses have resumed operations, they are yet to fully recover to pre-pandemic levels, indicating that some of the laid-off workers are still without work while another 1.42 million others joined the group in Q4’20. As of today roughly 20 million Nigerians are currently unemployed, according to report by the NBS.

The high unemployment rate in Nigeria, a country with a huge percentage of youth population, has been blamed for the increasing rate of insecurity and high wave of crimes. Today, crimes of kidnapping for ransom, armed robbery and advanced fee fraud featuring Nigerians under the 30-year age range have become the order of the day, placing Nigeria on the list of countries very dangerous to live in. Amid the high rate of unemployment is the pathetic stance of most employers that have failed to implement the minimum wage payment signed into law two years ago.

To make matters worse, in the heat of labour trying to enforce that, especially with some state governors, lawmakers, in their defiance to the suffering of the ordinary Nigerian, attempted to tamper with the law recently. It, however, met with great resistance from the workers’ community through the labour unions.

To put them in check, and in a manner that was largely appreciated by Nigerians, organised labour comprising the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) took their protests to the national and state houses of assembly to demand a halt to the lawmakers intention to introduce a bill seeking to remove the minimum wage from the Exclusive List to the Concurrent List. From the look of things, the Federal Government appears not to be giving up in its drive to silence Nigerians and bully them into accepting its position in all things.

With institution after institution going on strike as exemplified with that of health, judiciary and polytechnic workers just after that of non-academic staff of universities, it is yet to be seen that the country will be at peace to enable it meet the projection of IMF, especially coupled with the growing insecurity.

As it is, since no economy thrives under insecurity and industry disharmony, we advise the Federal Government to hasten to meet every agreement it entered into with workers while also redefining its strategy to put an end to insecurity that is threatening to tear the country apart.

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