As States Face Bleak Economic Future

Editorial

On 3 March, Governor Babatunde Fashola stormed the Lagos State House of Assembly with a new set of challenges of governance. Just like his face showed as he stepped up to address the state lawmakers, the country is facing one of its toughest periods, a grim situation that is causing confusion among the ruling class.

According to the governor, Nigeria is currently reeling in financial crisis and this is affecting governance in all the 36 states. Among other complaints, he explained how the Nigerian National Petroleum Corporation under-remitted the sum of N2.4 trillion to the federation account and that the Federal Government just started refunding the amount  piecemeal.

The situation has so degenerated to the extent that while revenue is declining, the Federal Government has, for the past six months, refused to hold the National Economic Council, NEC, meeting in Abuja with the governors. This NEC is supposed to be an organ for the discussion of economic issues concerning the 36 states of the country and comprises governors, the Governor of the Central Bank, the ministers of National Planning, Finance and others while it is chaired by the Vice President, Namadi Sambo.

This new challenge therefore means that many state governments, despite the huge debt profile hanging on their necks, would continue, in 2014, to look for ways to borrow to fund their budgets since the states all depend on federal allocations to meet the major part of their budget estimate.

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Before now, those versed in governance had often raised the alarm about the rot and impunity with which the NNPC is run. Many, on several occasions, called the parastatal a drain pipe. Then the reality gradually started creeping in and today, it has sunk. The country is in a deep economic mess.

As things are, it is doutbful if the present managers of the economy could turn the situation around. Therefore, governors must stop relying heavily on federal allocations to fund their budgets. There is not state in this country that does not have abundant natural or agricultural resources that could be harnessed to generate enough revenue to sustain their economies. It is over-reliance on petroleum resources that has put Nigeria in this economic quagmire.

If our agricultural and industrial sectors are revived, they could generate hundreds of thousands of jobs for the teeming youths. Most state governments have seen reason why agriculture could become the mainstay of their economy or as a non-oil revenue earning source, but in reality, only a very few of them have started veering into agriculture to generate revenue and employment.

We commend the Lagos State Government for taking the lead to set up farms both within the state and in other states where it had been able to acquire hectares of land. If sustained, according to experts, the state would soon be self-sustaining in that area. As states face a bleak economic future, embracing large scale farming would go a long way in turning around the situation.

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