1. FISCAL
POLICY
Class LM21
Group 7:
• Devi Kristiani Seran/2201841564
• Felix Sirinando/2201837711
• Nicholas Andrew Widianto/2201848734
• Pradipta Narendra/2201825642
• Raymond Richie Chandra/2201843651
2. EXECUTIVE SUMMARY
One of factor that effecting a country's economic failure is the high rate
of unemployment where the people in the country cannot fulfill their needs. And
with this not only the people but the impact of this also effect the government where
government also cannot decide what action to take so that the country will not fail.
And now how the government follow up to this is by the fiscal policy where
government take action such as using taxation so that government can recover some
money to run the government.
3. BRIEF
HISTORY
Nigeria is a developing countries in Africa.
Nigeria also one of the country with the
highest GDP in Africa because of the
agrarian sector as for this one there are
many things that Nigeria have to face and
that is the High rate of unemployment. As
you know almost 22% people of Nigeria are
unemployment and exempt from all of that
Nigeria are also know for the poverty of
people that caused by this unemployment
rate.
4. BRIEF HISTORY
International Labour Organization views five factors responsible for Nigeria
unemployment such as
1. High level of corruption has robbed the nation strong economic base, in
spite of the abundant natural resources
2. International Labour Organization observes that the nation’s education
curricula are in appropriate
3. The existence of continuous decline in the manufacturing sector in
Nigeria Manufacturers Association of Nigeria expresses that, more than
913 factories had shut down or collapsed
4. Nigeria has continued to experience rapid population growth rate, the
increasing population growth has produced great number of job seekers,
causing increase in number of working class population
5. The existence of rapid expansion of the educational system but weak
economy to absorb unemployed/graduates
5. BRIEF HISTORY
• The unemployed group of people
are waste or losses to the national
income growth
• Unemployment is a serious
problem to family stability
• Unemployment disharmonized
man in the society
• Poses a serious threat to a nation’s
existence and development
Unemployment
has effects on
both individual
and the socio-
economic of a
nation.
8. INDUSTRY
ANALYSIS
• Education
Higher levels of education increase
the chance an unemployed person
will emerge with a comparable wage
and reduce the time required to find
new employment. The psychological
impact of unemployment on a
household can have a significant
impact on the broader economy.
9. INDUSTRY
ANALYSIS
• Agriculture
An important reason for slow growth
of employment in agriculture and
rural sector has also been a shortfall
in investment or capital formation in
agriculture. Both the public and
private sector investment in
agriculture has declined since the
early nineties. Of special importance
from the viewpoint of employment
generation is investment in irrigation,
rural roads, flood control projects,
power generation and other
infrastructure.
10. INDUSTRY
ANALYSIS
• Micro Small and Medium
Enterprises
Small and medium enterprises have a
leading role in the job creation
process, absorb a large proportion of
the workforce from several levels, and
thus SMEs contribute to the
alleviation of the unemployment
problem, as well as ensuring the
sustainability of the economic
development process.
11. INDUSTRY
ANALYSIS
• Advance Technology
Digital tools are able to provide
insights and an understanding of the
future of youth empowerment and
employment. Data collection must be
improved, Decision-making must
then be based on the employability
of the person. Digital tools become
more efficient in solving daily
productivity problems and more
adaptive to learned situations.
The progress to a stage where digital
tools can be deployed to solve some
of society’s greatest challenges,
including unemployment and or
employability.
12. POLICY
ANALYSIS
The government of fiscal policy to Nigeria’s
economic growth, by examining the
growth effects of public income and
spending via budget surplus or deficit.
Changes in government revenue and
government expenditure are indicators of
fiscal policy, while the monetary policy is
proxied by changes in interest rate,
money supply, and exchange rate. An
increase in government expenditure, all
things being equal, leads to an expansion
in the production and workforce
(Kahn,1993, Keynes 1936).
13. POLICY ANALYSIS
Taxation (Contractionary). That includes
income, capital gains from investments, property,
and sales. Taxes provide the income, that funds
the government. The downside of taxes is that
whatever or whoever is taxed has less income to
spend on themselves. As a result, taxes are
unpopular.
14. POLICY ANALYSIS
Increase the tax base by raising the VAT
rate for luxury items from 5 to 15 per cent
from 2018, while improving CIT and VAT
compliance to raise 350 billion annually.
15. POLICY ANALYSIS
Government spending (Expansionary). That
includes subsidies, transfer payments including
welfare programs, public works projects, and
government salaries. Whoever receives the funds
has more money to spend. That
increases demand and economic growth.
16. POLICY ANALYSIS
Improve the budget preparation and
execution process, focusing on increasing
allocation to capital projects and
improving the quality of capital spending,
with a view to attaining a ratio of CAPEX
to total budget of 30-35 per cent.
18. ALTERNATIVES
The eradication or reduction of
unemployment in the society determines
the development of a nation. Therefore,
it is necessary for a nation to eradicate
unemployment such as
19. ALTERNATIVES
A nation should control her
rate of population growth to
create employment and
increase the job opportunities
to accommodate her citizens in
the labor market force
25. ALTERNATIVES
Government should establish a
stable welfare package service
for the unemployed rather than
wasting the existing resources
on white elephant projects that
can never be achieved.
26. RECOMMENDATION
So the best way from our point of view is
that the government should priorities the
fund for agriculture sector where as you can
see that Nigeria is one of the country with
tropical climate where there are a lot of
spices that can be cultivated. Also beside of
that Nigeria also had many mountains that
can support the agriculture sector where
with this, a lot of soil around the mountains
were very rich of nutrients for planting
plants that can became the commodity of a
country.
