Ogbonnaiye Francis – Ado-Ekiti
A University don, Prof. Philip Adetiloye, has said that the proposed national minimum wage by President Muhammadu Buhari, will not address the economic problems facing the country.
Prof. Adetiloye, who is a Lecturer at the Federal University Agriculture, Abeokuta, FUNAAB, said Nigerian traders will always increase prices of goods and commodities when wages are reviewed, adding that this may hinder the proposal of the federal government.
“Naira has consistently been depreciating since 1986, when the Military Head of State, Gen Ibrahim Babangida devalued the currency in line with the Structural Adjustment Programme (SAP) policy, describing the scenario as very disturbing and affecting the economy adversely”
Prof. Adetiloye suggested that the only way the Naira can be invigorated is for the Central Bank of Nigeria (CBN) to print high denominations like N1, 000, N500 and N200 to be denominated in kobo notes.
Delivering a paper entitled: ‘Nigerian Economy: Naira Value and Revaluation’ at the Nigeria Union of Journalists (NUJ), Ekiti Council, Adetiloye said President Buhari ought to have introduced the minimum wage policy immediately he devalued the currency two years ago.
He added that the preponderance of brain drain and penchant for corruption that had pervaded the country were buoyed by poor remunerations to Nigerian workers.
“The proposal may not be impactful because immediately the wages are increased, the market cartels will react to it by increasing the price.
“Under an ideal economic situation, when currency is devalued, the wages must increase because such policy always brings inflation. That was why prices of commodities like rice that was sold for N8, 500 is now sold for N16, 000.
“So, I expected the FG to have increased the wages immediately they devalued naira. So if they do it now, the prices will automatically go up and render the policy useless”.
For currency to be devalued effectively, Adetiloye said: “If naira notes are printed in kobo notes, this intervention will make a dollar to exchange for 360 kobo or three naira and sixty kobo. The government needs this drastic intervention to uplift the currency”, he advised.
According to the professor, for Nigeria to fully recover from these debilitating economic situations, President Buhari must improve productivity in agriculture, stop dependency on foreign goods, stop creating white collar jobs for graduates and end steady devaluation of currency.
Other reforms suggested by the academic were: injection of money into science and technology, enforcement of single-digit interest on all agricultural loans, stoppage of monetized politics and apportioning more resources to the 36 states and 774 local governments for radical development at the grassroots.
The professor, however, appreciated the efforts of President Buhari led administration in the war against insurgency, saying curbing stealing of public money had helped in stabilizing the economy better than before.