By Joyce Remi-Babayeju
Minister of State, Budget and National Planning, Prince Clem Ikanade Agba, has set up Macroeconomic Modelling lab cum the/Economic Intelligence Desk (EID) in the Economic Analysis Department of the Ministry.
During the inauguration Agba explained that the Modelling Lab was to serve as a clinical laboratory or “Wind Tunnel” where the technical officers of the Ministry were expected to test proposed new policies before implementation, study economic questions, and test cause and effect of macroeconomic problems.
According to him, data obtained from data generating agencies would be used in the lab to estimate the effects of public polices and test their validity.
Furthermore Agba explained that the lab would also be a place where officers would conduct a range of in-house empirical research activities, use macroeconomic models to observe and examine behaviours of economic agents for a given policy change.
The minister stated that the Modelling lab/Economic Intelligence Desk was equipped with portfolios of Macroeconomic models, namely: Macroeconomic planning models of the Nigeria Economy, Dynamic Input-Output model, ISDG Model, and the Dynamic Computable General Equilibrium Model of the Nigerian economy.
Prince Agba disclosed that the macroeconomic models and other analytical tools in the lab/EID would help the ministry play its role as the think- tank policy advisory body to the Government while the models for policy making in the lab could, among others, be used for testing proposed new polices before they were implemented.
He said that the models among other things is aimed at examining the effects of policy changes in the country, projecting the future time-path of the nation’s economy, designing and preparing the economic framework for National Development Plans and Annual budgets.
“Medium Term Expenditure Framework (MTEF), setting short term, medium-term and long-term targets for macroeconomic variables and development goals.”
The minister commended the Central Bank of Nigeria and Development Partners for their support in local and foreign training of the Ministry’s technical staff members on the use and development of models, ensuring regular review and maintenance of the models and database.
Also in helping in helping the ministry to hire staff with requisite knowledge and background in econometrics, quantitative economics, macroeconomics and software application.
Agba expressed his assurance that the lab would provide the much-needed regular updates, forecasts and economic outlooks for the Nigerian economy.
Permanent Secretary of the ministry, Mrs Olushola Idowu, disclosed that the Macroeconomic Modelling lab was set up by the Ministry for consistent forecast projections on key economic variables and the rapid changes and dynamics in the macro parameters to address shocks and others economic uncertainties.
Idowu said that the ministry identified the Computable General Equilibrium (CGE), iSDG-based systems Dynamics Models, inputs-outputs Tables and Econometrics Models as its portfolios of models for use in developing macroeconomic framework, forecasting, analysis and simulations for adequate understanding of the workings of the economy.
Idowu stated that the installation of some of the soft and hardwares for the Models and test-run had been completed and the introductory training on two of the models for the technical officers had also been carried out to enhance the capacity of the staff members of FMFBNP, ensure institutional memory and knowledge transfer. She enjoined the department to uphold the high expectations of the ministry in guaranteeing the continuity of the project.
The World Bank Senior Economist, Gloria Joseph-Raji, stressed that the modeling lab was extremely critical for policy analysis and would facilitate a medium to longer term planning, because they would help the ministry understand the past and present, predict the future and help evaluate policy scenarios.
She reiterated readiness of International Monetary Fund (IMF) in supporting the Ministry in its modeling forecasting.
Daybreak reports that present at the inauguration were the IMF Resident Representative in Nigeria, Ari Aisow, the National Policy Advisor GIZ-SEDIN, Catherine Ogumi, and the Policy Intern GIZ-SEDIN, Faulkener Oluranti as well, as Directors of the Ministry.
