100 days of Buhari: Political paralysis or policy crisis? (3)

Having addressed the apparent political paralysis leading to the dwindling of Mr President and the governing party’s political goodwill, how about the policy crisis resulting in the economic topsy-turvy currently besetting the administration? Sticking out like a sore thumb are the cases of appointments into offices that require Senate approval but of which the appointees have started functioning. Appointments of chairpersons of INEC, FIRS and AMCON as well as the dissolution of NDDC board are chief amongst such alleged constitutional aberrations which have become controversial. If you throw in the fallout of CBN rash of policy measures to save the naira from getting into a freefall and the consequential action of JP Morgan removal of Nigeria from its index of emerging markets portfolios, the circle of the ominous doom and gloom of Nigerian economy comes into full circle.

While there is very little that could have been done to ward off the JP Morgan threat in light of over 50 percent drop in oil revenue, ‘hot’ money by portfolio managers has always had its downside, which is the speed with which the money flies out of the country once signs of instability are spotted in the horizon. Compare it to ‘mum & dad’ investors’ funds that are typically long-tenured and therefore referred to as ‘cool’ money. The snag is that ‘mum and dad’ investors (retirees) in Europe and other parts of the western world hardly take interest in countries like Nigeria owing to the negative image of our country which is portrayed in the international media as full of conflict and disease-stricken people who are also fraudulent. The so-called cool money goes to locations like Dubai in UAE where the people and environment testify to progress and development and therefore handsome return on investment. So it’s safe to expect that how to counteract the negative perception of Nigeria by international investors would be priority to Mr President in the coming months and years.

Amongst other factors such as lack of coherent economic strategy, non-formation of a cabinet after 100 days in office has been touted as one of the reasons for the observed policy lapses. Justifiably, the wisecrack that two heads are better than one is relevant here as a functioning cabinet, sitting weekly, could have provided a platform for rigorous policy articulation by at least 36 experts from across the country and with varied experiences whom the constitution compels Mr President to appoint as ministers. Although President Buhari has explained that the delay in forming a cabinet is warranted by his desire to first lay a solid template for incoming ministers to build on, I would contend that there is an ongoing debate in management between efficiency and effectiveness and the case for effectiveness trumps efficiency. Most significantly, even though one is not advocating shortcuts, time lost can never be recovered hence the need for Mr President to weigh in with both effectiveness and efficiency which are highly critical at this point in time. It might interest the president to know that in the science of management, if you opt for efficiency you may take forever before taking off to execute a task, but if you choose effectiveness, you learn on the job and iterate along the line. No need emphasizing the obvious which is that great leaders gain the title by being effective.

Of course, a few notable salutary measures taken by President Buhari, such as facilitating the renegotiation of the huge debt stock of state governments plus payment of backlog of salaries of civil servants of the 27 insolvent states that would stimulate growth at the grassroots level (non-payment staff salaries by gobs stagnated growth), are commendable. Nevertheless, it is worrisome that Nigeria’s GDP has dropped from its high of about 6 percent a couple of years ago to between 4-5 percent last year and this year’s GDP growth pattern has so far recorded a disappointing rate of about 2.5 percent. In the world of economists, if a country’s GDP drops consecutively from year to year, the economy is officially in recession. Nigeria’s GDP has plunged from fairly high last year to the current very low level, so officially Nigeria can be said to be in recession. Similarly if a country’s population is growing faster than the GDP, that country is in economic dire straits. Currently, Nigeria’s population is growing at 3 percent while her GDP is in the range of 2.5 percent. So Nigeria may be on a slippery slope.

Yes, we want to fight corruption which is a clog and not an end but a means to an end, so where is the economic blueprint which should be the destination that we all should fix our gaze on? Could lack of an economy blueprint be negatively contributing to investor apathy that has seen significant capital flight?

It is to forestall a situation whereby Nigeria could become a basket case if allowed to continue to slide down the hill that commends itself to Mr President the need to make haste and come up with an economic blueprint that would put all hands on deck to steer the ship of state ashore by making governance attain full steam instead of the present constrained state of under-capacity utilization owing to full compliments and apparatus of government not being fully installed.

Permit me to close with the ominous words of wisdom from the prolific movie-maker, Woody Allen: “More than any other time in history, mankind [read Nigeria] faces a crossroad. One path leads to despair and utter hopelessness; the other to total extinction. Let us pray we have the wisdom to choose correctly.”

Magnus Onyibe