I had for years watched with
diminishing disbelief the Greek economy tank. That was long before the last
major crisis hit the headlines a little over a year ago. In early 2015, I wrote
an article titled Greece and Nigeria: Passing off Insolvency as Illiquidity
(BusinessDay -http://businessdayonline.com/2015/02/greece-and-nigeria-passing-off-insolvency-as-illiquidity/ ).
On that occasion, I was far less interested in sounding off on the
serial missteps by the rulers and citizens of Greece, (compulsive strikers and
tax dodgers all, in the fashion of the French), than in drawing urgent
attention to the predicament and looming crisis in Nigeria. Was I a prophet or
what? No. The signs were all over the place.
I recall
that as the US was ramping up its oil and gas production from new and enhanced
recovery processes, (of which fracking is just one), our people in the NNPC and
Ministries of Finance and National Planning continued with their unsolicited
refrain that everything was going to be just fine. The question remained. How?
The facts on the ground belied their unwarranted confidence which was soon
dashed as US imports from Nigeria continued on the downward trajectory to near
zero. The full significance of this development was obviously lost on our
government until the global oil price hit rock bottom. And China, the new great
knight from the east, also started cutting back too. By then it was too late to
do anything in the short run.
As a
failed manufacturer, I know for a fact that the current ballyhoo on
diversifying the economy, is just talk. It is almost too late. It is hard
enough trying to develop within a reasonable time frame and run a successful
science and technology based venture with all the finance available, but
however with the usual downside of having to compete with the US, UK,
Germany, Japan and finally China, not to mention Brazil and India. As it is, it
is well nigh impossible to succeed now with almost no sources of funds, a
confused government heckling as opposed to encouraging you, and the chorusline
of the EU proposed EPA insisting that our borders be thrown open to all manner
of imports.
It is
against this background that I find myself aghast at the recent deal announced
during the recent federal executive Council meeting by finance minister, Kemi
Adeosun, which will see the government get a foreign denominated bond that will
“give each state at least a billion naira monthly but only on meeting certain
conditions like cleaning their payroll, cutting recurrent expenditure, using
Treasure Single Account, among others.” It is strange that these
conditionalities were not immediately handed out to Gov Aregbesola and his Osun
State a year ago. My reaction then was one of incredulity. These would have
applied to any other state government, and there were many, profligate enough
to fall into the same situation. The mess has since snowballed to the point
where we now have to borrow in dollars to pay salaries in naira. This is not
sustainable.
Meanwhile, I find it most disturbing that our Vice
President, Prof Yemi Osinbajo speaking for his boss, shared his
belief with the public that the Nigerian economy cannot get any worse than
this. That is a very dangerous assumption. He should please ask those who are
more knowledgeable. Italy, Argentina and Brazil, much more advanced and
established economies, with relatively strong institutions in place, are
examples worthy of serious study.
It is unacceptable that one full year down the road, an
administration that had supposedly been planning a rescue mission a full two
years before it won the election, could still be dwelling on "the fall of
the price of oil" or indeed "Jonathan" as a reason for failing
to deliver on its campaign promises. Olusegun Adeniyi has written at length on
the immense value and feelgood advantages for the government to quickly
determine things that are readily achievable and proceeding to do them. Enough
of the whining.
I had restrained myself from wrapping up this commentary when I
realised that President Buhari would in a matter of hours address the nation on
the occasion of his first anniversary. Giving him the benefit of doubt, I
looked forward to a new tack in the way he would be speaking to us. I was
sorely disappointed to note that Buhari, in leading his administration, would
continue to blame all manner of external factors for our stalled and receeding
economy. Blame everybody else except ourselves, meaning the leadership. Hear
him:
"On the economic front, all oil dependent countries, Nigeria
included, have been struggling since the drop in prices. Many oil rich states
have had to take tough decisions similar to what we are doing. The world, Nigeria
included has been dealing with the effects of three significant and
simultaneous global shocks starting in 2014:
A 70% drop in oil prices.
Global growth slowdown.
Normalization of monetary policy by the United States federal reserve.
The
president's analogy of the farmer reaping three bags as opposed to the previous
ten bags of grain, is most pedestrian and not exactly correct. He could and
should have elevated his discourse. Where on earth are his speech writers, if
he has any?
Quoting
Azuka Onwuka, (I think), our president and his team clearly need help.
