Nigerians have re-elected Muhammadu Buhari as president for the next four years. He defeated former vice president Atiku Abubakar, his main opponent, by 56% to 41%, securing 15,191,847 votes against Atiku’s 11,262,978. Atiku has rejected the result, describing the election as “a sham”. In truth, though, while there were huge irregularities in the election, they did not materially affect the result. So, Buhari won, Atiku lost!
That said, Buhari doesn’t deserve his re-election. In hardly any civilised country would an incumbent with President Buhari’s appalling record, especially on the economy, secure a second term. Under Buhari’s presidency, unemployment rose from 8.2% to 23%; youth unemployment skyrocketed from 3m to 13m (a 263% increase), Nigeria’s stock market became the worst performing in the world, FDI dropped from $8.9bn in 2011 to $2bn in 2018, and Nigeria became the world’s poverty capital, with 90m people living in extreme poverty, while the country ranked 8 out of 128 in the world’s misery index in 2018. How could a president with such awful failures claim entitlement to a second term?
So, Buhari’s re-election is not earned. The initial negative impact on the stock index, a barometer of market sentiment, proves this. As Bloomberg reported, “Bank stocks in Nigeria fall most since 2016 after Buhari victory”, showing that the anti-business president, whose economic record and grasp of economic fundamentals are miniscule, was not investors’ or the wider business community’s preference.
Yet, Buhari has won; albeit by default! Why by default? Well, as the American journalist Franklin Adams famously said, “Elections are won by men and women because most people vote against somebody rather than for somebody”. Truth is, Buhari won because most Nigerians voted against Atiku rather than for him. They didn’t want Atiku and, by default, settled grudgingly for Buhari. As I predicted in this column, the election was fought on integrity, and Buhari’s perceived personal integrity, his reputation for incorruptibility, worked for him, while Atiku’s perceived lack of integrity, his reputation for graft, worked against him. It’s as simple as that; integrity trumped ideas and competence in the election!
Yet, each of the two candidates was a bundle of contradictions. Buhari was pro-poor, yet anti-business; Atiku was pro business but brash and amoral. A London Times journalist captured this contrast well when he wrote that “Atiku would enrich himself and Nigerians, but Buhari would do neither”. In other words, while Buhari would not enrich himself, his statist anti-growth policies wouldn’t enrich Nigerians either but rather impoverish them. In contrast, Atiku’s pro-business and pro-growth policies would enrich Nigerians, but, as part of that, he would enrich himself or at least his cronies. The trade-off was unpalatable, but, for me, Atiku was the lesser of two evils!
How could a leader be pro-poor and yet anti-business? It defies logic. As Sir John Major, a former British prime minister, said, “A society in which business is not successful is going to be a society which is poor”. This is because the greatest antidote to poverty is private sector-driven economic growth, not state interventions through government handouts. But an economy will not grow where the private sector is stifled or where markets can’t operate freely in a competitive environment. Recently, in an interview with the Financial Times, the Ethiopian prime minister Abiy Ahmed said “My economic model is capitalism”, adding: “We need the private sector”. Is it any wonder that Ethiopia’s economy is growing at 8.5%, while Nigeria’s state-led economy is languishing under 2%?
The truth is that Nigeria lacks a supportive market-based policy environment to attract private financing and long-term domestic and foreign investment flows. The government doesn’t seem to understand the distinctions between drivers, enablers and barriers. For instance, some say the Buhari government’s main achievement is infrastructure spending. But physical infrastructure is not the driver of investment, that is, the direct reason someone would invest in a country. Lack of infrastructure will constitute a barrier, i.e. delay or prevent an investment, and having infrastructure would be an enabler, i.e. helping to overcome the barrier. But the drivers of investment are policies that increase, or guarantee, returns or profitability. These are macroeconomic stability and polices that allow markets, not government, to allocate or regulate resources such as foreign exchange, imports and prices. But Nigeria talks a lot about enablers, such as infrastructure, but ignores policy drivers, such as economic openness and market-based institutions.
In its Nigeria Biannual Economic Update (2018), the World Bank described the Central Bank’s development financing schemes and foreign exchange restrictions to support import substitution as “suboptimal policy measures” and called for “significant structural and fiscal reforms”. Buhari rejected structural reforms in his first term and, in his re-election acceptance speech, signalled a more-of-the-same approach, saying “We have laid the foundations and we are committed to seeing matters to the end”. In other words, he wants to build on the same foundations that made Nigeria and Nigerians poor in his first term. But such continuity will simply make Nigeria poorer, and increase the pauperisation of Nigerians. Which raises the questions: Why did Nigerians vote to be poorer by re-electing Buhari?
Indeed, there are many oddities about the presidential election. First is the low turnout. 73m people collected Permanent Voter Cards (PVCs), but only 29m, about 36%, voted. Even 1.3m of the 29m votes were rejected. Given what was at stake, the future direction of Nigeria, and who to entrust it with over next four years, why did over 60% of Nigerians with PVCs refuse to vote? Of course, one can blame INEC’s incompetence, but it’s also true that Nigerians don’t take elections seriously. In the more affluent South, where most citizens were critical of Buhari, and should have preferred Atiku’s liberal policies, the turnout was well below 30%. They refused to come out in large numbers to vote for Atiku, perhaps unimpressed by his fabled integrity problem. But they are now stuck with Buhari!
The other oddity is the voting behaviour of the poor. Several people who are unemployed or can’t make ends meet voted massively for Buhari. A World Bank’s report says about 66% of Nigeria’s poor reside in the North. Yet, the poor in the North, who have suffered under Buhari’s first term and would be further immiserated under his second, if he continues his failed economic policies, preferred him to Atiku, whose policies could create jobs and reduce poverty. But for most of the poor, concerns about Atiku’s integrity trump consideration of how his proposed economic policies could improve their welfare.
Why would anyone act against his or her own economic interests? Well, evidence shows that the poor often do. For instance, during Britain’s EU referendum in 2016, poor people and regions, which would suffer most from the UK’s exit from the EU, voted for Brexit. So, there is a parallel between the voting behaviour of the poor in the UK and those in Nigeria. In the UK, poor people and regions put sovereignty and immigration issues above the economic benefits of remaining in the EU. In Nigeria, the poor preferred a pious Marxist, whose policies would make them poorer, to an amoral capitalist, who could improve their living standards.
Yet, all that said, the onus is now on President Buhari to show that, by voting massively for him, the poor in Nigeria did not vote to make themselves poorer. This means he must change direction and implement policies that generate economic prosperity for Nigerians. But don’t hold your breath. He has already said the next four years “will be tough”! Nigerians have got the leader they deserve!