Prof. Park Idisi, the Dean, Faculty of Agriculture, University of Abuja, says over borrowing is one of the reasons Nigeria is currently in recession.
Idisi made this known to the News Agency of Nigeria (NAN) on Thursday in Abuja.
He said that most of the funds borrowed by the government were used for consumption instead of investing on productions.
He said that some of the fund borrowed somehow slipped into corrupt hands as well.
He said that COVID-19 also contributed to the current recession that the Nigerian economy slipped into.
According to him, insecurity in the northern part of the country is another reason for the recession where bandit, herdsmen, community clashes stopped farming activities, making foods expensive.
He said that in the last few years, Nigeria had been in and out of recession and “this has gone deeper and deeper’’.
“We are not just in recession but depression because it has become a norm; we have been in and out of recession in the past few years.
“Recession may take less than a year or two to pull out from it but depression is a very deep form of recession.
“It takes years of continuous loss of jobs, high unemployment rate, low GDP, low output, high inflation; becoming pervasive, and high level of indebtedness.
“It takes massive and stringent economic measures for over a period of more than five years to pull out from depression,’’ he said.
According to Idisi, the characteristics of recession and depression are not too different, is just that one is deeper that the other.
He said that Nigeria entered into recession since the lockdown which Nigerians were not aware of.
He said that recession and depression causes inflation, where few goods and services were being chased by large population “or by so much liquidity, when prices are increasing’’.
“Inflation is a situation where a large population pursuing very few goods and services leading to hike in price, this is an indicator that the economy is going into recession, which we are facing now.’’
He said however that Nigeria could be out of its current situation by first quarter of 2021, if corruption and mismanagement of natural resources were dealt with.
“I am optimistic that Nigeria will be out of recession by first quarter of 2021, if Mr President and his team can find solutions to the economy and security situation in the country.”
Idisi also noted that the current GDP of Nigeria had slightly improved from minus six to minus three, which was an indication that Nigeria could come out of recession by 2021.
“Harvest of crops are coming out which will make high cost of food crashed, oil price stability and investment are all expected to improve our economy.”