Olusegun Aganga, former minister of finance, says the
presidential system of government is expensive for Nigeria.
The former minister, who also held the trade and investment
portfolio, said the COVID-119 pandemic is a unique opportunity for Nigeria to
make needed structural changes.
Aganga served as minister of finance from 2010 to 2011,
after which he was appointed minister of trade and investment, a position he
held until 2015.
In an interview with The PUNCH, he said Nigeria failed to
save for a rainy day, and would need to cut the cost of governance to meet its
needs.
“My first focus will be to cut and control costs in a
significant way. Cut the wastages, block revenue leakages, and take this unique
opportunity to cut the cost of governance,” he said.
“We all know that the presidential system of governance is
an expensive one. And we now know we cannot afford it.
“This is a unique opportunity to make certain structural
changes; we should not miss the opportunity. History will judge us well if we
did. We also need to reprioritise
spending and improve the quality of our spending.
“When we talk about sources of finance for the economy as
opposed to the budget, there are four main sources. The first is the
government-sourced revenue including loans.
“This is limited now but if we make our case well and we are
seen to have taken some tough measures already, we may be able to access some
grants, soft loans. I believe the government is already doing this. But expect
revenues from taxes, customs, and value added tax to fall.”
Aganga said the effect of the pandemic on Nigeria’s economy
will be “devastating” especially with sustained fall in oil price.
“We were already heading for a tough time pre-COVID-19, but
I expect it to be much tougher now because of the twin effects of COVID-19 and
the significant and sustained fall in oil price,” he added.
“The glut is going to hit Nigeria harder because we do not
have any refining capacity or solid long-term oil contracts as the Saudis have
with China and we are almost entirely dependent on oil revenues to support our
budget and reserves.”
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