Doyin Okupe Calls For Bi-Partisan Cooperation Over Threat Of Crashing Oil Prices To Nigeria’s Economic Stability
The immediate past Senior Special Assistant on Public Affairs to ex-President Goodluck Jonathan, Dr. Doyin Okupe, has expressed fears that the volatility of oil prices in the international market is threatening the stability of Nigeria’s oil-dependent economy.
In a Facebook post titled “issues of the moment” on Monday, Okupe said with the price of crude oil hovering between USD26 and 28 per barrel, the development directly undermines the profitability of the oil enterprise as the cost of production of the product in Nigeria is about USD30, second only to Russia.
“The danger signal here is clear and profound. The implication of this price regime is that we begin to lose $4-$2 USD for every barrel of crude oil we produce.
“It is pertinent to state clearly here that this ominous situation is totally out of the control of the present administration”, the ex-presidential spokesman stated.
This position is in clear contrast with that posited by the Minister of State for Petroleum Resources, Ibe Kachikwu, who at the weekend assured that even if crude were to sell at USD20 per barrel, Nigeria would still be able to make a profit of USD7 as the cost of production of a barrel of the product is USD13.
Mr. Okupe, however, said because every citizen is a stakeholder in the Nigerian project and any external threat to the survival or interest of Nigeria calls for a bi partisan approach, it is imperative that everyone must come together to find a solution to the problem.
As a first step, the medical doctor turned politician said the 2016 budget proposal of N6.08 trillion at an oil benchmark of USD38/barrel, must be adjusted immediately.
“Recurrent expenditure must be reduced by 50% minimum, while the capital is reviewed to focus mainly on projects that will directly impact on production and export driven initiatives”, the former presidential spokesman counseled the Federal Government.
Dr. Okupe further advocated that the budget deficit of N1.84 trillion comprising a domestic borrowing of N984 billion and foreign borrowing of N900 billion “must be reduced substantially” while the bench mark is brought lower to between USD17 and USD20.
He also called for the liberalization of some aspects of the Central Bank of Nigeria, CBN’s foreign exchange policies, saying “Nigerians and foreigners must be encouraged to bring in their foreign currencies with absolute necessary guarantees”.
While reiterating that the ongoing anti-corruption drive of the present administration must continue unabated, Okupe stressed that emphasis must be placed on recovering looted funds stashed abroad to boost the country’s foreign cash inflow.
“The need for the government to declare a national emergency and nationwide austerity measure regime cannot be over emphasized”, he added.