How FG turned deaf ears when opportunities knocked
In little over a year, Nigeria would be choosing a new leader, a leader most Nigerians hope will be remarkably different in competence and talent than President Muhammadu Buhari.
“I have never seen such incompetence like I see with this President and his government,” a European diplomat covering economic and trade told BusinessDay. “They came, they saw and they destroyed.”
His election in 2015, under a cumulus of expectations that he himself and his party the All Progressives Congress (APC) had encouraged, marked the first time in Nigeria’s 55-year history as an independent state that a ruling party was ousted by the ballot, not the bullet.
In a well-choreographed campaign that vaunted him into the leadership of the nation that year, Buhari promised to focus on three key priority areas when elected. He vowed to ensure the safety of Nigerians by putting an end to Boko Haram and other forms of insecurity in the country. He threatened corruption, promising to kill it ‘before it killed us’, and also swore to Nigerians that the economy would change for the better.
With just a year left for him to leave Aso Rock, Buhari and his government have failed to change any of those three areas to critical success stories. Rather it has been one big unwholesome story of missed opportunities.
While the president’s allies quixotically claim he is in hurry to develop the country, most Nigerians believe that he has failed to achieve any perceptible modicum of meaningful development or indeed growth in the last seven years. A citizens’ perception and attitude survey on topical issues and trends covering a potpourri of social, economic, political, governance and public-life issues released in March by Africa Polling Institute (API) found that only one in 10 Nigerians (eight per cent) are happy with the current state of affairs in Nigeria, under Buhari.
Buhari came into office under a massive cloud of goodwill from Nigerians and the international community. Aloof, kinetically unsociable and inflexibly tribal, Buhari turned deaf ears to the numerous opportunities that could have transformed Nigeria. Rather, like an unskilled shipmaster, he ran the country aground.
Almost every sector of the country’s social and political economy under Buhari’s leadership has come under unparalleled internal shocks of ineptitude, intellectual apathy and the beatification of insensitivity. The opportunities lost are massive and telling, so are the attendant fallouts that could take decades to repair.
A politics of injustice, division and disconnection
On May 29, 2015, Nigeria was in dire need of healing the variegated political, ethnic and religious divides occasioned by the fierce contest for political power between the then ruling Peoples Democratic Party and the opposition APC. Twerking in victory that was legitimised by the gracious acceptance of defeat by the then incumbent, Buhari signalled the divisive, Kafkaesque nature of his politics. He had no interest in uniting the country. Questioned at the United States Institute of Peace (USIP) in July 2015 on what he intended to do about the Niger-Delta with respect to amnesty programme and socio-political inclusiveness, Buhari made it clear, he was going to treat constituencies that gave him ’97 percent’ of their votes better than those that gave him ‘5 percent’ of their votes. By this, he indicated that he was going to engage in non-nationalist pork-barrel politics that would give more power and projects to the core Northern states where he had garnered the most number of votes.
It was a shocking statement that reaffirmed the nativist tendencies of a president falsely modelled as a nationalist by his campaign managers. The clannish nature of Buhari’s politics was further accentuated by his lobbying the World Bank to prioritise its developmental programmes across the northern parts of Nigeria.
“In my very first meeting with President Buhari, he said specifically that he would like us to shift our focus to the northern regions of Nigeria and we’ve done that,” World Bank’s immediate past president Jim Yong Kim told reporters in Washington.
Outside projects and programmes, Buhari’s appointments have been outrageously divisive, helping to heighten a feeling of disconnection from the nation’s socio-political centre by populations in the Southeast and the Niger Delta. The president’s tepid response to large-scale killings and destruction by Fulani militia in the Christian dominated Middle-belt region of Benue, Taraba, Kaduna and Plateau states further amplified the disconnect between Buhari’s government and Nigerians who perceived his lukewarm response to the killings as a nod to his ethnic group’s bloody grab for power and land.
An economy abused and misused
When Buhari assumed office in May 2015, Nigeria’s GDP, a measurement of the health and size of the country’s economy, stood at $525 billion. Seven years later, Nigeria’s GDP is $432.3 billion, some $90 billion sliced off the economy as a result of little to no growth since late 2015.
The opportunities to expand growth stared Buhari in the face. He had a chance to bring in the best brains and hands in and out of the country to help him run the economy. He had the chance to ensure a market driven exchange rate system that would have encouraged investors rather than a fixed exchange rate regime he so favours that has so corrupted the nation’s FX system.
Buhari chose an execrable economic management team, and Nigeria’s economy has been on a freefall since then. While the president asserts that his administration’s “job creation, policy consistency and innovation have since 2015 developed the economy,” the fallacy and misconception in that statement, is obvious from the fact that the country in 2020 became the poverty capital of the world.
“The reality of the nation is that corruption, unemployment and inequalities have destroyed the nation’s economic framework, causing it to be the poverty capital of the world,” Krishna Panchal noted in a Borgen Magazine analysis in 2020.
According to figures from data consulting firm StatiSense, in 2015, when Buhari came into office, 54.51 million Nigerians were fully employed. Five years later, only 30.57 million Nigerians had full employment. Unemployment rate, which stood at 10.4 percent in 2015, rose to 35 percent in 2021, up 6.06 percentage points from the 33.3 percent reported in 2020, according to figures from Agusto & Co.
Inflation rate which stood at 9.01 percent in 2015 currently stands at 16 percent and the nation’s debt stock which stood at about 9 trillion naira when he came into power seven years ago, has now ballooned to about 32 trillion naira with nothing perceptible to show for Buhari’s debt binge.
The depressing state of the Nigerian economy under Buhari, was aptly enumerated by the Economist magazine in its May 2019 edition, when it noted, “the Nigerian economy is stuck like a stranded truck. Average incomes have been falling for four years; the IMF thinks they will not rise for at least another six. The latest figures put unemployment at 23 percent, after growing for 15 consecutive quarters. Inflation is 11 percent. Some 94m people live on less than $1.90 a day, more than in any other country, and the number is swelling. By 2030 a quarter of very poor people will be Nigerian, predicts the World Data Lab, which counts such things.”
The unskilled and insidious management of the nation’s monetary and FX policies by a central bank keener on pleasing the political leadership of the country has left devastating cracks on the nation’s economic landscape. Questionable economic policies of the administration, drove the World Bank to warn again in November 2021 that, “the government’s exchange rate management policies continue to discourage investment and fuel inflation. FX management remains too rigid to respond to external shocks. Meanwhile, exchange-rate management has emerged as one of the key drivers of inflation”.
The president, a retired diplomat and former senior national security officer, came in promising to stabilise the exchange rate. We had a clear case of the exchange rate being at about 160 to the dollar in 2015, now it has risen to almost 600.
He has not made any dent to unemployment, rather there is more desperation amongst our youths and you can see this in the glorification of yahoo boys, kidnapping for ransom and others, and poverty is just climbing.
The main reason I think this has happened is that the problem we have in this country is so deep that there must be a certain ‘deliberateness’ in any effort we are going to make to address the rot. Unfortunately, this ‘deliberateness’ has been lacking in this government.
“The varied interventions of the central bank in different areas of the economy show the absence of a clear strategy to deal with the issue. There is no clear strategy of engaging with the citizens at coming clean with what is going on. What is required is a return to the drawing board to work with all stakeholders to lay the foundation for a better economy.”
It was the need for this deliberateness that led the late economist and former CBN Deputy Governor, Obadiah Mailafia, to advise the administration that “there is a desperate need to diversify the economy away from dependency on petroleum.
Secondly, they need to be able to balance the books, because right now the government has a revenue crisis on its hands and the debt situation is getting out of hand.
And thirdly, they need to work on the expenditure framework. A lot of money is going down the drain and nobody knows what is going on there. It is not about having a yearly budget, it is about what the budget is achieving and the budget is not achieving anything.
Fourthly, we need to work on the central bank. CBN has been invaded and impacted by some bandits. We can’t keep multiple exchange rates because it is just a drain pipe; what the Americans call a pork-barrel. We must fix it. There should be a single exchange rate and everybody must be subject to that single exchange rate with no favouritism of any kind.
Fifthly, we need to create a competitive economic environment. Right now, we don’t have an economy that can compete for investments; we are losing investments to Ghana and Rwanda, investments that we cannot afford to lose if the government is keen on creating jobs and engendering growth.
Sixthly, we need to work on our tax policy. In an atmosphere of slow growth, you just don’t increase taxes unless you want to kill the goose that lays the golden egg and it seems that’s what they want to do.
We need to expand the tax base, not so much as increasing the rate. A lot of people and SMEs are not captured in the VAT. Let’s not be lazy, let’s make an effort to expand the VAT net by bringing in those who are presently outside it.
Don’t forget that a lot of the VAT paid by companies are not even remitted to the government, so there are many ways we can be innovative in expanding the tax base and even double and triple the revenue and income that goes to government, it is not just by the lazy approach of increasing the VAT rate”.
A Diaspora ignored
Hugo Cuevas-Mohr, in his analysis of the Nigerian diaspora and remittances, noted that “one of the most fundamental acts of Nigerians when leaving the country is sending money home. Family is key for Nigerians and supporting their families back home is the ultimate expression of love, commitment and duty of Nigerians in the Diaspora.”
Nigeria accounts for over a third of migrant remittance flows to Sub-Saharan Africa, and according to PwC, “these flows amounted to $23.63 billion in 2017, $22 billion in 2018, and represented 6.1 percent of Nigeria’s GDP. The 2018 migrant remittances translate to 83 percent of the Federal Government budget in 2018 and 11 times the FDI flows in the same period. Nigeria’s remittance inflows were also 7.4 times larger than the net official development assistance (foreign aid) received in 2017 of $3.4 billion”.
Remittances from Nigerians abroad rose to $14.2 billion in the nine months ending September 2021. Nigeria’s diaspora possesses real and substantial resources, both in financial terms, and in terms of human capital, as noted in the US government census data.
They can be mobilised to be key players in trade links between Nigeria and their countries of residence. Despite the setting up of the Nigerians in Diaspora Commission in 2017, Nigeria’s government has not been able to mobilise the power of Nigerians abroad to drive and support Nigeria’s economic development and diplomatic power.
An effective engagement with Nigerians in the United States, the United Kingdom and South Africa among others has the potential to build a power base for Nigeria’s diplomatic and economic engagement with the world.
An OECD study found that, Diasporas and migrants returning to their country of origin can also influence political and civic life. For example, the study noted, “several recent studies reveal that migrants have the potential to play a leading role in political change in terms of government changeovers, the level of democratisation and the formalisation and depersonalisation of institutions, and that they can also make stronger demands on local governments, particularly with regard to respecting basic rights. Finally, they can spur the demand for a more responsible and transparent government”.
This, Nigeria’s political leaders fear.