After one particularly costly sustainable expenditure that devalued Nigeria’s naira and its purchasing power as a result of certain economic measures and again, the introduction of fuel subsidy; keep petrol at a stable price, agric subsidy, economic reform among others, the Nigeria government decided to prepare for future emergencies by creating a special fund named Sovereign Wealth Fund by finding another source of income.
The bill passed popularly called the Sovereign Wealth Fund Bill was passed into law on the 17th of May, 2011. By making it the law, there are many doors it would open and soon this country succeeds on such build up, that Sovereign Wealth Fund will expose how wealthy Nigeria can explore.
However, it didn’t happen that way. For example, whenever the country earns a check for $300 billion immediately a new people-effected project should be honestly carried out after setting aside 40% of these monies as posterity fund.5%.
Also in limbo is the National Recovery Plan. This suggests a further N91 Billion was clipped from the National Statistics and also in Budget 2011, with cuts of over N17 Billion specifically targeted at environmental protection in the built and natural heritage areas.
Under this Plan, which was presented to the IMF in return for the bail-out, the National Sovereign Wealth Fund had promised a substantial N550 million to fund power-sustainability. The cost for the provision of electricity services to the domestic sector in 2010 was N590 Billion. If energization proceeds without delays, according to this Plan electricity charges will begin to benefit the exchequer by N8 Billion in 2014.
However, I could always look at the positive side of earning extra money for the National Sovereign Wealth Fund. Those unexpected bills would have required taking money out of Nigeria regular earnings, and that could have meant cutbacks in other areas. Establishing an the National Sovereign Wealth Fund for unexpected expenses is more than just a convenience. Often it is needed for paying sudden bills or settling obligations that must be met quickly.
For example, Nigeria was offered a built-and-transfer rail and locomotive stations on an emergency need, the expenses must remain covered, but if we wanted the overall rural communities in Nigeria to be covered, we needed a quick N500 billion extra
It is on a sound note that the Jonathan regime vowed to use its spare time and political experience to steer Nigeria into the right direction. If successful, that extra income would help establish and build Nigeria’s future.
Then, inevitably, Kangaroo Law is not deemed to take-over in the nearness future. This government should crush any plans to use the Sovereign Wealth Fund for fun family extras, such as dinners out, political rallies, party concerts and ball game tickets.
Nigeria needs a finance plan. The American Civil War was followed by a boom in railroad construction. 56,000 miles (90,000 km) of new track were laid across the country between 1866 and 1873. Much of the craze in railroad investment was driven by government land grants and subsidies to the railroads. At that time, the railroad industry was the nation’s largest employer outside of agriculture, and it involved large amounts of money and risk. A large infusion of cash from speculators caused abnormal growth in the industry as well as overbuilding of docks, factories and ancillary facilities.
At the same time, too much capital was involved in projects offering no immediate or early returns. The decision of the German Empire to cease minting silver coins in 1871 caused a drop in demand and downward pressure on the value of silver; this had a knock on effect in the USA, where much of the supply was then mined. As a result, Coinage Act of 1873 was introduced and this changed the United States policy with respect to silver. Before the Act, the United States had backed its currency with both gold and silver, and it minted both types of coins. The Act moved the United States to a ‘de facto’ gold standard, which meant it would no longer buy silver at a statutory price or convert silver from the public into silver coins (though it would still mint silver dollars for export in the form of Trade Dollars).
Poor economic conditions caused voters to turn against the Republican Party. In the 1874 congressional elections, the Democrats assumed control of the House. Public opinion during the period made it difficult for the Grant Administration to develop a coherent policy regarding the Southern states. The North began to steer away from Reconstruction. With the depression, ambitious railroad building programs crashed across the South, leaving most states deep in debt and burdened with heavy taxes. Retrenchment was a common response of southern states to state debts during the depression. One by one each Southern state fell to the Democrats, and the Republicans lost power.
On May 9, 1873, the Vienna Stock Exchange crashed, no longer able to sustain false expansion, insolvency, and dishonest manipulations. A series of Viennese bank failures resulted, causing a contraction of the money available for business lending. 25 years after the Revolutions of 1848 was then one of the more famous private individuals, who went private bankrupt in 1873 in Vienna, Stephan Keglevich a relative of Gábor Keglevich, who had been the main royal treasurer of Hungary 1842-1848 and who had founded in 1845 with some others a financing association to finance the Hungarian industry and to protect the loan repayments.
No doubt, in 1873, as already noticed, the collapse of the foreign loan financing had been foreshadowed, but the anticipatory events of that year were in themselves comparatively unimportant, Buda the old capital of Hungary and Óbuda were officially united with Pest; creating the new metropolis of Budapest in 1873. The described important difference of stability between Vienna and Berlin had the effect that the French indemnity to Germany overflowed thence to Austria and Russia, but these indemnity payments aggravated the crisis in Austria, which had been benefited by the accumulation of capital not only in Germany, but also in England, Holland, Belgium, France and Russia
Understanding a few basic strategies in setting it up can help alleviate the pitfalls we see around our economy. To survive and thrive in a total economic collapse, we need to build up our resources. Many everyday items and services will be sporadically available, or even nonexistent. Preserved foods, I remember the northern Nigeria groundnut pyramid of the “70s,where are they today? electricity systems, nationhold facilities, fuel, medical necessities, sanitation and transportation are things Nigerians need to consider when we are building up our economic system and resources. If we have a lot of resources, there will be countries who don’t, and some of them will attempt any means to get them. Nigeria should protect her citizens abroad and again her social amenities from vandalizers.
In order to survive an economic recession, the best thing to do is to have an emergency fund as “Sovereign Wealth Fund” set up in case a job is lost. Increase knowledge of current events to help survive an economic recession .With commodities prices soaring, the Nigeria government has been in talks for months about tinkering its famed naira menu. The most noticeable change is the disappearance of the double oil-ledgers, the sacred sandwich of the Nigeria business cycle among others.
From my own tentative study of the domestic migration of the 1970s-1980s, it appears that the Nigeria economy has been composed by a multi-layered complex of regional economies that might be better seen, in turn, as consisting in various regional economic units, set both by state or federal government. It is therefore possible that such a structure and its changing dynamics are really much more complex than has been generally acknowledged.
All of these four histori
cal factors should be considered thoroughly for our estimate of the long-term national income accounts of Nigeria. When rightfully linked to the various studies in Nigeria economic history, they allow us to successfully explain how the livelihood of the Nigerian people has been dynamically affected and shaped by some larger forces from within the country and without.