Like Ex-US President Reagan, Tinubu will prove doubters wrong, his policies will yield great dividends – IMPI

The Independent Media and Policy Initiative (IMPI) has stated that President Bola Tinubu’s policies will eventually have a positive impact on the Nigerian economy despite the short-term pains.

The policy think tank reached this conclusion after analyzing the President’s nationwide broadcast following the August 1 to 10 protests.

In a policy statement signed by its Chairman, Niyi Akinsiju, IMPI compared the Tinubu administration’s policy thrust to that of some former Western leaders, which were initially vilified but later hailed as successful.

“To illustrate this, we recall the vicious attack on the economic policies adopted and implemented by the administration of President Ronald Reagan in the United States of America between 1981 and 1989. Late President Reagan’s policies were described by opposition figures as ‘voodoo economic policies.’

“However, the Reagan years were later described as years of prosperity, with interest rates, inflation rates, and unemployment falling faster than they did immediately before or after his presidency.

“In the same vein, we also recall the place of Mrs. Margaret Thatcher in the making of modern Britain. Upon becoming the British Prime Minister after winning the 1979 general election, Thatcher introduced a series of economic policies intended to reverse high inflation, which later paid off. However, Britain struggled against those measures at the time, in what was described as the ‘Winter of Discontent.’

“Her political philosophy and economic policies emphasized greater individual liberty and the privatization of state-owned companies while reducing the power and influence of trade unions.

“These economic and political preferences were fondly labeled ‘Thatcherism’ by supporters. Today, major political parties in Britain accept the trade union legislation, privatization, and general free-market approach to government.

“Yet her critics, while in government, vociferously claimed that her administration’s successes were achieved only at the expense of great social cost to the British population.

“In our consideration, the August 1-10, 2024, protest is evidence of the usual intolerance to new thinking and innovative policy-change implementation, as experienced by the leaders of the countries highlighted above,” it added.

While dissecting President Tinubu’s speech, the policy group outlined the pragmatic thinking behind many of the initiatives of the Tinubu administration.

IMPI stated: “Through our findings, we have established the relatively low cost of CNG compared to Premium Motor Spirit, otherwise known as petrol. Our independent investigation shows that 50 liters of PMS is equivalent to 30 kilograms of CNG. Whereas the average fuel economy for PMS is 10 to 15 km per liter for a typical passenger vehicle, the average fuel economy for CNG is 20 to 25 km per kilogram.

“If this is mathematically captured, it would be as follows: 50 liters of PMS at N650 per liter is N32,500, while 30 kg of CNG at N250 will amount to N7,500, with a difference of N25,000. This, in our view, is pragmatic thinking.

“Going forward, we note with interest the ongoing implementation of programs as highlighted by the President in his speech. These include the Consumer Credit Corporation, which has moved from the drawing board to disbursing credits to eligible beneficiaries, a first in the history of this country.

“In tandem with this is the Nigeria Education Loan Fund (NELFUND) or the student loans scheme, another revolutionary initiative to support education. According to our checks, we understand that more than N2.5 billion has been disbursed as loans to qualified beneficiaries out of the N150 billion establishment fund in the first three weeks of operations.

“President Tinubu also revealed the federal government’s activation of the technology and innovation industry with $620 million under the Investment in Digital and Creative Enterprises (iDICE) program.

“The objectives of this program include empowering young people, creating millions of IT and technical jobs, and producing millions of technical talents, which confirms the forward-looking capacity of the President, who is determined to pivot the national developmental trajectory on technology and innovation.”

IMPI also acknowledged President Tinubu’s assertion that his policies have paved the way for an increase in the nation’s earnings without the need to raise taxes or accumulate more debt.

The policy group stated: “The President’s revelation of the reduction of revenue used in servicing national debt from 97% to 68% over a 13-month period is not only heartwarming but also suggests an economy distancing itself from the profligacy marked by the fuel subsidy regime and multiple foreign exchange windows.

“Again, in fundamental ways, we reasoned that the recorded revenue-to-debt service ratio reduction is a consequence of the removal of the fuel subsidy and more dollar inflows into the economy, which reflected in the $24 billion foreign exchange inflow in the first half of 2024. This compared positively with the $7.29 billion inflow in the first half of 2023.

“Deriving from the above, we expect a further reduction in the debt service ratio with the increase in national income and a reduced inclination to acquire more debt. This implies the availability of more revenue to meet the critical needs of the Nigerian people, as already exemplified in the total distributable revenue for the three tiers of government in the first half of 2024, which is stated at N12.45 trillion compared to N5.2 trillion for the same period of 2023.

“As the President put it, this quantum leap in revenue availability to the three tiers of government has given the country more financial freedom as well as the room to spend more money on citizens and to fund essential social services like education and healthcare.

“It has also led to the states and local governments receiving the highest allocations ever in the country’s history from the Federation Account.

“What the President said concerning the budget and revenue is that the nation’s budget, which had been characterized by perennial deficit, has for the first time in many years reduced by 29 percent to N2.83 trillion in the first quarter of 2024 from N3.96 trillion in the same period of 2023.”

IMPI added that it was remarkable that the policies have now begun to yield fruit, with the July inflation figure showing a decline for the first time in almost two years.