Nigeria must brace up to respond to economic impact of Russia-Ukraine war

The ongoing war between Russia and Ukraine has worsened the economic situation globally and Nigeria and other countries must prepare as things may get worse.

This was stated by Nigeria’s Vice President, Yemi Osinbajoon Friday, in Ebonyi State.

Mr Osinbajo said Nigeria’s economy is reeling from the fallout of the COVID-19 pandemic and the Russia-Ukraine war.

While calling for synergy among all tiers of government to tackle the challenges, he warned Nigerians to brace themselves for what could be a tougher economic situation.

“The need for synergy among all tiers of government at this critical time, especially as we continue to face the challenges of the onslaught of COVID-19 pandemic, which is now compounded by the ongoing war between Russia and Ukraine, has already led to price and supply shock, especially in food.

“We must brace ourselves to collectively respond to the inevitable economic challenge that will occur and some which are already occurring,” he said.

Nigeria imports about 50 per cent of its wheat from Russia and Ukraine. Russia’s invasion of Ukraine has also led to increases in the prices of several commodities including oil. Although Nigeria is a net exporter of crude, a lack of local refining means it imports most of its refined petroleum products like petrol and kerosene, whose prices have all increased.

Nigeria’s Vice President, Yemi Osinbajo with Ebonyi State Governor, David Umahi, in Ebonyi State [PHOTO CREDIT: Professor Yemi Osinbajo]

Poor governance in resource-rich countries

Mr Osinbajo also blamed the lack of development in countries with huge natural resources, like Nigeria, on poor governance and weak institutional structures.

He also identified a lack of transparency and accountability as other factors militating against national development.

He spoke at the 21st Meeting of the National Council on Development Plan (NCDP)

He said the theme of the meeting, “Good Governance and Institutional Capacity: Pathways to Sustainable National Development” is apt as there is a need to develop the capacity of Nigeria’s institutions to properly implement its development plans.

“The strategic objective of the national development plan includes establishing a strong foundation for a diversified economy, investing in infrastructure, improving government and stamping out insecurity; all of which would contribute to achieving our national development aspirations.

“The content of the plan is as important as the process that which it was developed.

“But the implementation of the plan is the crux of the matter and this speaks of the relevance to the theme of the meeting …

“The question I am sure some of us ask ourselves is that why countries with huge natural and human resources still develop slowly and have greater number of poverty than other less endowed society or country without resources at all like South Korea and Singapore.

“Why do they still perform better than the resourceful country of the world? I think most of the surveys conducted show that there is lack of good governance and weak institutional capacity that largely account for the difference.

“How public institutions function is of course an approach determined by institutional capacity. But this is not merely having a merely educated and well-motivated workforce. But a system that can enforce transparency and accountability. You must have a system that can deliver on transparency and accountability.

“So even when a country has the whole natural resources in every local government area and even a well-educated workforce, a country can still fail and social services can still be poorly delivered and extreme poverty can prevail,” he said.

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The vice president commended the council, federal ministry of finance, budget and national planning, federal and state MDAs and all stakeholders and partners in the private sector and the civil society for the sterling work done in the articulation of a national development plan 2021-2025 .

“The council on development planning has remained a very important platform for setting the tone of national development. It certainly provides opportunity for federal and state governments to fathom active collaboration for the well-being of our people,” he said.

Umahi opposes VAT by states

At the event, the Ebonyi State Governor, David Umahi, opposed the collection of Value Added Tax (VAT) by states, describing it as an invitation to anarchy.

He noted that the National Assembly should be encouraged to look into the matter and work on including VAT in the exclusive list of the Nigerian constitution, to be handled only by the federal government.

Mr Umahi’s comments follow the controversy triggered by a court ruling that empowered states to collect VAT. Although the federal government is challenging the ruling in court, states like Rivers have already asked companies in their state to pay their VAT to the state government and not the federal government.


Also at the event, the Minister for Finance, Zainab Ahmed, urged states to ensure that their medium-term plans align with the country’s aspirations.

He also advised them to partner with the organized private sector in carrying out their development plans.

The vice president later commissioned some projects carried out by the state government.

They include the dualization of a section of the Abakaliki/Afikpo highway, Sam Egwu Flyover Ezzamgbo, the new government house chapel and the Muhammadu Buhari Light Tunnel.

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