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Government keen on economic diversification to mitigate drop in oil price

By on January 27, 2015

Worried by the worsening price of crude oil in the global market, President Goodluck Jonathan, in company of some of his ministers, pledged on Sunday that his administration was committed to diversifying the economy to address the drop in oil price.

Jonathan was speaking at an interactive forum organised by the private sector and leaders of professional bodies in Lagos.

The president said his administration was being run on the philosophy that
the role of government was “to set up the enabling environment for the private sector to run the economy. This is what we have done”.

The statement by Jonathan was in response to earlier statements made by many of the ministers in attendance, majority of whom identified economic diversification as the present administration’s major standpoint.

First to speak among the ministers present was the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, who emphasised that the thrust of the present administration’s economic policy was diversification.

“Before the fall in oil price, the president saw the need to tap into the rest sectors of the economy. Transformation agenda is equal to diversification agenda. We saw the need to develop the agricultural sector which stands at 22 per cent, services at 51 per cent, industry at 26 per cent, telecoms at 8 per cent and then you have the creative industry at 1.1 per cent,” she said.

According to the minister, “Governments in the past talked about diversification, but it is this government that has done it. The good news is that with the diversification of the economy, we can now move forward.”
Okonjo-Iweala during her speech touched on several achievements of the current administration. On the issue of job creation, the minister said that government was rigorously addressing the issue.

“At inception of this administration, we discovered that Nigeria needed 1.8 million jobs yearly. Now, over the past four years, we have been able to create an average of 1.4 million jobs every year,” she said.

She listed on-going reforms in the rail and port sectors as some of the achievements of the Jonathan administration.

“For more than a decade, we did not have a working railway, but it has been revived under this administration. We now have the Lagos-Kano, Port Harcourt-Maiduguri and Abuja-Kaduna railway. Also, with the ports, we are working on reducing clearing from seven days to 48 hours,” she added.

Highlighting the achievements in the oil and gas sector, the Minister of Petroleum Resources, Mrs. Diezani Allison-Madueke, said that in the downstream sector, the government had “ensured stability in oil supply”.

Although she said that government continued to lose about 60,000 barrels of crude oil to theft per day, an action which she insisted Nigeria could not afford, the minister said the country’s crude oil production for years 2008 to 2014, stood at 2.5 million barrels per day.

According to her, “We are aggressively increasing local participation in the oil and gas sector; we are moving towards 70 to 80 per cent private participation in local refineries production.”

On his part, the Minister of Agriculture, Dr. Akinwunmi Adeshina, said: “The president saw the problem of failing to diversify the economy over three years ago and took interest in the agricultural sector.”

Adeshina said that Nigeria’s food import bill had dropped under Jonathan’s administration, due to the successes recorded in the fertiliser distribution channel, which he said was done in a space of months.

“It took us 90 days to tackle corruption in the fertiliser industry,” he said.
The Minister of Trade and Investment, Dr. Olusegun Aganga, too made reference to diversification as being “the theme of this administration” before reeling out the achievements recorded under his ministry.

“In the sugar industry, at least 200,000 jobs have been created. Also, we now export cement outside Nigeria, and Innoson Motors has produced a car with 45 per cent local content participation,” he said.

According to him, “In the last four years, Nigeria is the number one investment sector in Africa. We need continuity to move these developments forward.”

The Minister of Power, Prof. Chinedu Osita Nebo, said that Nigeria had moved from producing 2,800 megawatts of electricity to 4,400 megawatts, with an increase of 1,800 kilometres in transmission lines.

Regarding road infrastructure, the Minister of Works, Mike Onolememen, said that under Jonathan’s administration, out of the 35,000 kilometres of federal roads, from 4,500km that the present administration met on ground, 25,000km have been upgraded and developed.

Fielding questions, Jonathan had reiterated earlier statements that his administration was interested in fighting corruption and solving the issue of insecurity ravaging some parts of the North-east.

“We are fighting corruption. It is not by publicly jailing people. Yes, we believe in suppressing corruption, but our emphasis is in prevention; by setting up structures and institutions such as we were able to achieve with the e-wallet for the fertiliser purchase for farmers,” he said.

On insecurity, he said although Boko Haram was initially “underrated”, but “we are working and I promise you that we must suppress terrorism”.

 

[ThisDay]