When a government has an already-floundering economy on its hands, it calls for urgent reinvigoration through the boosting of spending (in a manner that helps people’s productive engagements as well as their ability to earn and spend money). It must be seen that there are very active and effective actions to revitalise the economy. In this attempt at revitalization of the flapped economy, there must be a balance between infrastructure development and people’s purchasing power development. For instance, it will be a badly-skewed attempt if there is much concentration on road construction but the people to use the road for productive engagements are abandoned with nothing about their entrepreneurial stimulations.
Such beautiful roads will have poverty-stricken, despondent derelicts trudging with slumped shoulders on the roads. Then, this situation raises the question: of what use is infrastructure development where the people that ought to put it to efficient, effective and optimal use lack necessary capacity to make productive use of the infrastructure? Such a city becomes a city with golden streets populated by ruined-in-rags.
A floundering economy needs socio-economic measures from its government to reinvigorate the economy in manners that will boost spending and employment. Part of needed stimulus package should include fiscal (cutting of taxes and increase in spending), monetary (reduced interest rates and provision of special funds for MSMEs), even quantitative easing (central bank purchasing instruments from commercial banks for liquidity).
For emphasis, these well-coordinated efforts to lift out and stimulate a depressed economy should really increase government spending, lower taxes and as well lower interest rates. The aftermath of the Second World War remains a succinct example. With Western Europe in ruins, there was a set of financial aid packages to the nations in ruins. The target of the financial aid was to help rebuild the devastated economies. The US government provided over $13 billion in economic aid (approximated to be roughly $140 billion today) to 16 European countries. The provided economic aid helped in achieving significant rise in gross national product (GNP) of the ruined countries and facilitated rapid renewal of key industries like chemical, engineering, and steel.
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Now this is the kind of stimulation we want to see in Nigeria. That Nigeria’s economy floundered and went comatose in 2023 isn’t a news again. We are witnesses to ‘efforts’ being made by the Tinubu administration toward revitalizing the economy – with the fuel subsidy removal and unification of the forex market. But the economic stimulation efforts is calling for serious review. Few days back at the national caucus meeting of his political party, President Tinubu reiterated that monthly allocations to State Governments had tripled since the fuel subsidy was removed in May 2023. Mr President, in his words, declared: “today, I can beat my chest and each of the Governors here can confirm that allocation to the states is tripled. We have enough funding from the Local Government.” Apart from loud applause by the governors who were present at the caucus meeting, no governor has disputed this supposed gargantuan money flow. If funds are flowing into states government coffers as expected to enable economic reinvigoration, are the people in various states really feeling the increased money flow into their constituencies?
As mentioned above, in an attempt to reinvigorate a depressed economy, there must be a balance between infrastructure development and stimulation of people’s means of livelihood in an efforts to boost their purchasing powers. In the light of the increased money-flow from the federal government, what are the State Governors doing to mitigate the ravaging hardships bedeviling the people in their states? In what ways are the people being helped to stimulate and boost their ability to make money, earn incomes and spend disposable incomes with ease and without worry or fear about where to get the next income? Some states government are quick to refer to road rehabilitations as a good way to spend their increasing monthly allocation. Where this is the case, can smooth roads with poor people strewn all over it be a good economic development? Is infrastructure development without people development a good balance and the best way a people’s economy can be or should be stimulated? What happened when and where there’s money in-flowing and yet the people are wallowing in abject poverty? Should the money be used to stimulate commerce to improve the people’s purchasing powers and their disposable incomes or be left in the covers of privileged few, possibly politically exposed ones?
A federal system of governance is dual sovereignty. Under this arrangement, it is the responsibility of each state government to build its economy, develop and grow it. A city or state worth living in must be significantly populated with a people that have capacity to spend money and not beggars. They are mostly a people quality standards of living. If one may ask: what are the efforts being made by the state governors to improve the standards of living of their people? Or are they waiting for the federal government to come and hold them by the hands to build the States’ economies?
As usual and repeatedly, there is another report that there will be a food crisis in 26 states of the federation in few months time (between June and August 2025).This food crisis warning given through a report from Cadre Harmonisé (CH) has revealed that 30.6 million Nigerians across 26 states and FCT could face this food crisis between June and August 2025. According to the report, about 25.8 million people, including 116,765 Internally Displaced Persons are already experiencing the food insecurity.
And come to think of it, is the monthly dole-out from the centre the panacea for the states economic development or, if we want to quickly help the states, we should entrench true fiscal federalism quickly? Is the federal government doing the right thing by giving monthly allocations or each state should be allowed to take charge of its economy through bottom-up system of governance – instead of this militarily-imposed top-down approach?
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