Dr. Biodun Adedipe, the chief consultant of B. Adedipe Associates Limited and an economist, yesterday criticized the World Bank, the International Monetary Fund (IMF), and other pro-western institutions for their assessments of the nation, claiming that the outlook is extremely positive and promising.
Adedipe criticized the position of the Bretton Wood institutions on the nation’s revenue, growth, debt sustainability, foreign exchange management, and subsidy, among other issues, at the 2023 microeconomic outlook hosted by the Chartered Institute of Bankers of Nigeria (CIBN) and his firm. He insisted that a more thorough analysis of the situation is required.
The economist noted that tax revenue exchange for infrastructure is frequently left out of the computation of debt to revenue ratio and claimed that Nigeria does not have a revenue problem but rather “an issue the issue is a matter of priority.
“With all sense of responsibility, I do not agree with what the World Bank says about our economy. The claim that a lot of our revenue is going into debt servicing is incorrect. We have a situation where there is an exchange of tax revenues for infrastructure.
“When we compute our revenue, we ignore that. That is part of our revenue, and before computing the debt service to revenue ratio, you should bring that into the conversation. Then, you will get a healthier ratio,” Adedipe argued.
He claimed that the use of the proceeds, rather than the debt profile, had him more concerned, noting that significant sums had been spent on infrastructure for the transportation of people and goods and for the production of electricity.
He claimed that the Federal Government sponsored the capital expenditures that the electricity districting companies (DisCos) undertook last year, something that many Nigerians were unaware of.
He claimed that in order to get a fair judgment regarding the matter, the massive spending needed to be genuinely included in the debt analysis discussion.
The World Bank revised its estimate of the nation’s growth for 2023 to 2.9% in its January Global Economic Prospect. Adedipe, though, asserted that the outlook was better than the bank’s stance and set his conservative prediction at 3.27 to 3.32 percent.
He predicts that the inflation rate would decrease from its present level of 21.34 percent to 17.76 percent, and that the parallel exchange rate will close at N705/$ as opposed to the official rate of N480/$.
The analyst also criticized the Central Bank of Nigeria’s (CBN) repeated calls to discount the naira because to the rising disparity between official and unofficial rates, claiming that even if devaluation closes the gap today, the premium will eventually reappear.
He argued that it has become the global trend to use both conventional and unconventional methods to control inflation and foreign exchange rates.
The World Bank and IMF have put significant pressure on the CBN to adopt a more liberal approach to managing foreign exchange in order to stop market arbitrage, which is allegedly to blame for the blatant market manipulation. According to The Guardian, over the last three years, the differential may have cost the nation N8 trillion.
Adedipe also criticized what he called the inaccurate designation of Nigeria as the world’s capital of poverty.
He claimed that new information has confirmed the need for a more accurate assessment of what poverty is and that the prevailing narratives are unreliable.
The President/Chairman of the Council of CIBN, Dr. Ken Opara, also spoke at the occasion and expressed optimism that “better days are ahead of Nigeria” in the coming year, placing his trust in the impending shift in political leadership.
“We need to gain insight into the impact of several economic indices to help us undertake a comprehensive assessment of the opportunities, challenges and indeed the threats that businesses may encounter during the current year. Every organisation needs to be fortified with adequate information to give them insights into what the new year holds.”
“This will undoubtedly serve as a guide in making informed decisions critical to the growth of businesses and in reviewing strategic plans as the need may arise,” Opara said.