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Recession: 5 Facts Before President Buhari Took Over Power In 2015

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In the face of the recession Nigeria is currently coming out from, there have been several attacks on the current administration.

Here are 5 indisputable facts before the current government came into power. Recall that as at Dec 2014, oil price was still above $64/barrel.

1. 27 state governors were owing back log of salaries as at May 2015 when this government took over hence the bail out funds approved for governors. Despite this bail out funds, many refused to meet their obligations.

Buhari in ‘bailout’ meeting with governors- June 23; 2015

With a view to breaking the ice over the “salary crisis” in most of the states, President Muhammadu Buhari‎ will on Tuesday meet with the 36 state governors, Femi Adesina, presidential spokesman, has confirmed through his Twitter handle.

Buhari in ‘bailout’ meeting with governors

Why have Governors refused to pay salaries, allowances in spite of bailout funds? – Dec 30, 2015

Some states are still defaulting in their financial obligations to their workers in spite of the bailout funds by the Federal Government to assist them to pay outstanding salaries and allowances. Recall that the Federal Government released N338 billion to 27 states as bailout funds to pay their workers backlog of salaries and allowances.

Read more at: https://www.vanguardngr.com/2015/12/why-have-governors-refused-to-pay-salaries-allowances-in-spite-of-bailout-funds/

2. Federal Government was borrowing to pay 2015 salaries.-May 6, 2015

Nigeria borrows to pay salaries with cash crunch worsening. (Vanguard)

A cash shortage caused by low oil prices has forced Nigeria to borrow heavily through the early part of 2015, with the government struggling to pay public workers, officials said Wednesday. “We have serious challenges. Things have been tough since the beginning of the year and they are likely to remain so till the end of the year,” said Finance Minister Ngozi Okonjo-Iweala.

Nigeria typically sets its benchmark crude price between 75 and 80 dollars, and is supposed to deposit excess revenue in a savings account. But even when crude was selling above $100 last year, Jonathan’s administration struggled to build savings. Critics say the excess crude account has been repeatedly raided by powerful political actors.

Read more at: http://www.vanguardngr.com/2015/05/nigeria-borrows-to-pay-salaries-with-cash-crunch-worsening/

3. Oil marketers were owed billions, led to a fuel scarcity that paralyzed Nigeria, even banks were closing before time, telecoms operators were sending texts about expected disruptions (never in Nigeria have this happened until 2015)

Nigeria fuel shortage cripples businesses, banks and flights – 25 May 2015

Nigeria is being crippled by the fuel shortage that the country has been experiencing for more than a month.

Nigerian banks have shortened opening times, flights have been cancelled and phone companies may restrict services.

The party of President-elect Muhammadu Buhari has accused the outgoing government of “sabotage” for failing to deal with the crisis.

The wholesale fuel sellers have been withholding petrol as they say they are owed $1bn (£625m) by the government.

http://www.bbc.com/news/world-africa-32873349

4. Okonjo-Iweala who many people in the opposition believe would have done better or saved the economy warned of tougher times as oil slipped low to about $76.

Brace for tougher times ahead, Okonjo-Iweala tells Nigerians -NOV 2014

Nigerians should brace for tougher economic times ahead, the Minister of Finance, Ngozi Okonjo-Iweala, has said as crude oil prices slipped to a four year low on Wednesday.
The Federal Government had attributed the declining revenues to the fall in prices at the international oil market.

After drawing from the ECA, Minister of State for Finance,
Bashir Yuguda, said the balance in the account had dropped further from $4.1 billion to about $1.34 billion at the moment.
But Mrs. Okonjo-Iweala said in Lagos on Tuesday that the economic indicators show there are tougher times ahead.

According to her, Nigeria would begin to feel the impact of the dropping oil prices at the international oil market, which commenced since the first half of the year.

5. Falling Foreign Reserves

Nigeria’s foreign reserves drop to $29.13 billion

Nigeria’s foreign reserves fell to $30.04 billion by Thursday, November 26, the Central Bank of Nigeria has said.

The bank disclosed this on its website on Monday.

Nigeria’s foreign reserves oscillated between $28 billion and $36 billion in the last one year.

The reserves hit $36.3 billion in October 2014, fell to $32.4 billion in January 2015, and stood at $28.6 billion by May 2015.

Under the new government of Muhammadu Buhari, the reserves gained marginally to $31.9 billion by July, before sliding again to $29.9 billion by September.

With the above facts, every sane discerning mind will see that Nigeria was already in a mess before the change of power.

The question everyone should be asking now is where are the infrastructural developments that can justify all the money Nigeria made in the past 16 years of PDP’s rule particularly in the last 7 years of PDP’s rule when Nigeria made alot of money from crude oil sales?

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