Nigeria: Coronavirus, Oil Price – Why Our Economy Is in Trouble, Explains Ekweremadu

Former Deputy President of the Senate, Senator Ike Ekweremadu, has blamed the immediate adverse effects of the slump in oil price on Nigeria on the refusal to structure the nation as a federal state to diversify her economy.

Ekweremadu said the implication was that rather than enjoying about 36 economies along the federating units, Nigeria was stuck with a mono-economy driven by oil. The lawmaker bared his mind at the maiden Annual Lecture of the Faculty of Law, Nnamdi Azikiwe University, Awka, entitled ‘The Law’s Treatment of Economically Disadvantaged Groups: The Need for Alternative Emphasis in Commercial Law’, delivered by the President of the National Industrial Court, Justice Benedict Kanyip, in Enugu.

Ekweremadu, who described Nigeria’s unfolding economic realities as gloomy, said various tiers of government might not be able pay salaries after four months if the slump in oil earnings continued.

“It is no longer news that a combination of the Coronavirus pandemic and the crude oil price war between Russia and Saudi Arabia, is already taking huge tolls on our economy and the 2020 budget. Whereas our budget was hinged on $57 oil benchmark, the price of oil crashed further to $24 on Wednesday.

“The Organisation of Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA) have equally predicted that Nigeria and other developing countries, which rely heavily on oil revenue are set to witness a decline as their income from oil and gas is projected to fall by between 50 per cent and 85 per cent in 2020, reaching the lowest levels in more than two decades. Already, the value of naira is tumbling down.

“Obviously, our past, our rebuffing of all advocacies and constitution amendment efforts to provide for compulsory savings from our oil earnings, entrench fiscal federalism, devolve powers, and restructure Nigerian economy have caught up with us, once again.

“If there is one lesson we will have to learn the hard way, therefore, it is that ‘feeding bottle federalism’ does not pay. Ordinarily, we should have been talking abo “It is my hope that when the impending economic tsunami settles, we will see the need to diversify the economy, and we will see that there is no better way to do so than to entrench real fiscal federalism to unleash the economic potentials and comparative advantages of the various federating units”, he added.

Meanwhile, the President of the National Industrial Court, justice Benedict Kanyip, has reminded the government that the nature and degree of consumer protection regulation in any modern society says a lot about that society, its values, sense of justice, priorities, as well as social, political, and economic development.

“The point I seek to make is very simple: Because the law looks to virtually and only the commercial prism of transactions, the economically disadvantaged individual in those dealings is almost always never contemplated. What we end with is a legal/judicial subsidisation of the liability rules in favor of the very powerful groups.

“In other words, when it comes to liability, the rules are skewed in favor of the powerful, against the weak. So, each time some kind of paternalism is suggested for the law, this becomes the underlying reason”.

He emphasised the need to properly deploy the law towards the better protection of the consumers and the economically disadvantaged.

Also speaking, the Dean, Faculty of Law, Nnamadi Azikiwe University, Prof. Meshach Umenweke and Chairman, Faculty of Law Lecture Series, Prof. Offornze Amucheazi, pledged the Faculty’s commitment to sustaining the lecture series to better the society and Nigeria’s democracy.

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