The effects of the global economic and financial crises on the Nigerian economy, like any other developing nations, could be far reaching as such all hands must be on deck to reduce the impact on the macroeconomy of the country.

This view was expressed in a communiqué issued at the end of a special Parley organized by Covenant University to critically examine the “Implications of the present Global Economic Crises on the Nations’ Economic and Financial Fortunes.”

The discussants at the parley, which observed that the crises had led to falling commodity prices, crash in the prices of stock in the capital market, fall in production in the industrial sector, depreciation in currency, among other deleterious outcomes, said the attendant fall in industrial output and general shrinkage in aggregate demand was expected to worsen unemployment situation in many countries with ripple effects on the revenues accruing to those nations.

They said the shrinking industrial sector of the developed economies has already affected the demand for Nigeria’s mono-cultural product of crude oil and therefore advised the country to diversify and develop other sectors of the economy especially the industrial and agricultural sectors.

The parley lamented that the present efforts of government to douse the effects of the crises was not deep enough and therefore advised it to brace up and admit that there are problems as well as being ready to offer bail-outs where necessary.

The Parley opined that the current global financial crises offers an opportunity for the Global Financial System as typified by International Monetary Fund and World Bank to redesign the rules of the game from the global point of view by tightening up loose ends in the world banking and financial system and by making institutions like the IMF to be an independent central bank other than being under the political control of some nations.

The following recommendations with respect to Nigeria were also made at the parley:

• Government at all tiers should be people and development oriented to ensure that the interest of the people is paramount at all times in the policy making process. This will reduce corruption within the system.

• Professional and regulatory functions of the financial system should be strengthened to disallow irregular and unethical activities by the operators

• The banking and financial system should begin to provide long-term finance for the real sector to encourage increased production in the economy. Funds from the pension funds can be used for this purpose if the banks are unwilling to or unable to lend to the sector.

• There is a need for a total overhaul of the capital market in Nigeria to avoid the issues of speculation, abuse of the system through insider trading and margin trading in securities.

• There is need for reduction in interest rate to encourage the real sector to profitably borrow and able to repay comfortably. Interest rates in most developed economies are usually less than 2%. Nigeria is running a regime of higher than 20% interest rate at present.

• People should learn to tighten up and avoid unrealistic way of living through credit and borrowing.

• The National Universities Commission should revisit the curriculum of the universities to ensure that students are given the right orientation to meet the challenges of the economy as they are released into the market.

The Parley was moderated by Dr Charles K. Ayo, Director, Academic Planning Unit of the University and had as discussants some leading academics in the University, including Professor Joshua Abiodun Thompson Ojo, a distinguished professor of Banking and Finance; Professor Don N. Ike, a renowned Economist and Professor Sunday Otokiti, an expert in International Business.

It had active participation of the University’s faculty and staff led by Vice Chancellor, Professor Aize Obayan and Registrar, Dr Daniel Rotimi as well as the Principal Officers.