Obinna Chima writes on the performance of the Ministry of Budget and National Planning in almost four years
Although the Minister of Budget and National Planning, Senator Udoma Udoma was appointed in November 2015, it took him 17 months to introduce the Economic Recovery and Growth Plan (ERGP), a medium term all-round developmental initiative focused on restoring growth, investing in people and building a globally competitive economy.
Specifically, the ERGP which was launched in April 2017, is a three-year programme which would terminate in 2020. The economic agenda of the ministry is completely hinged on the plan.
The vision of the ERGP is one of sustained inclusive growth. It is aimed at increasing national productivity and achieving sustainable diversification of production, to significantly grow the economy and achieve maximum welfare for the citizens, beginning with food and energy security. It also provides a blueprint for the type of foundation that needs to be laid for future generations, and focuses on building the capabilities of the youth of Nigeria to be able to take the country into the future.
The ERGP has three broad strategic objectives that would help achieve the vision of inclusive growth and they include restoring growth; investing in people and building a globally competitive economy.
Interestingly, the ERGP in the past two years (2017 and 2018) missed its economic growth projection as the country continues to battle growth constraints.
The ministry conducted an ERGP Focus Labs to develop solutions to some of the challenges in the economy identified by the plan. The focus labs were designed to identify projects that can drive economic growth and create jobs through mobilising private investments in three vital sectors of the economy. The initiative took place over a six-week period between March and May 2018 and involved 180 organisations including ministries and government agencies. The labs had set a target of $9.25 billion for private sector investments into manufacturing and processing which would create over three hundred thousand jobs across the six geo-political zones by 2020.
However, in line with the plan, the drive by the federal government to promote activities in the non-oil sector appears to be gaining traction. This is evident in the Gross Domestic Product (GDP) figures being released by the National Bureau of Statistics, which have always indicated an uptick in non-oil activities.
For instance, the non-oil sector contributed 92.94 per cent to real GDP in the fourth quarter (Q4) of 2018, slightly higher than the 92.65 per cent recorded in Q4 2017. The sector grew by 2.70 per cent in real terms within the review period. This was 1.25 per cent higher than the growth rate recorded in Q4 2017, and 0.38 per cent higher than the growth rate recorded in Q3 2018.
But some commentators have argued that implementation of the plan partly supported the recovery of the Nigerian economy since it slumped into recession in 2016.
In their assessment of the ERGP, analysts at Deloitte, one of the leading professional services firms in the country identified challenges such as funding, budget implementation, security challenges (specifically in the North-East and North-Central), fluctuation in global oil prices and increasing use of alternative sources of energy (e.g., shale oil), as factors that have continued to affect the plan.
However, while some of the target metrics in the plan appear overly ambitious, the fact remains that the citizens are yet to feel the impact of the policies of the Ministry of Budget under Udoma since his appointment.
Another downside to the performance of the ministry under the leadership of Udoma is the fact that he has been able to work with the National Assembly to tackle the issue of budget delay, which appears to have become a norm in the country. This has necessitated the call for the country to return to a January- December budget cycle to allow for effective planning by businesses as well as to promote investment.
Finally, the ministry which is also saddled with the responsibility of budget monitoring and evaluation cannot be said to have efficiently carried out this task.