A common view in political economy literature is that the disciplining forces of globalisation constrain the behaviour of governments; that the fear of adverse market reactions prevents governments from pursuing irrational policies. Susan Strange, the renowned political economist, famously coined the phrase “The Retreat of the State” to describe this phenomenon. But Nigeria wants to defy the conventional wisdom. For instance, Muhammadu Buhari’s interventionist government has often shown hostility towards global companies, the latest being Twitter, the world-famous social networking service.
Recently, Lai Mohammed, Nigeria’s Minister of Information and Culture, struck a triumphalism tone as he reeled out a list of stringent conditions for lifting the Federal Government’s ban on Twitter’s operation in Nigeria. The minister said the government would soon lift the ban because the social media platform had accepted the conditions. This is a clear case of the state taming the market, yet it is also an incredible act of self-harm because Nigeria will pay a heavy price for such a hostile behaviour.
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Before we come to that, it is worth remembering that Buhari and his government once loved Twitter. Few governments used Twittermore than the Buhari government. In 2019, as Buhari ran for a second term, Twitter was the platform used ad nauseam for his campaign propaganda: his media team inundated millions of people with tweets and retweets about his administration’s “infrastructure revolution” and other “achievements”.
But things later went awry. First, the government accused Twitter of fuelling the #EndSARS protests. Then came Twitter’s decision to site its Africa headquarters in Ghana. The decision really irked the Buhari government, which believed Nigeria was the rightful place for the HQ. After all, Nigeria dwarfed Ghana both in population and the number of Twitter users. But Twitter said it chose Ghana because it is “a champion for democracy, a supporter of free speech, online freedom, and the Open Internet”. Of course, the implication, rightly, was that Nigeria lacked those attributes.
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The last straw was Twitter’s decision on June 2 to delete President Buhari’s tweet. Buhari evoked the spectre of the Nigeria-Biafra War and threatened separatist agitators in the South-East with the alarming words: “We will treat them in the language they understand”. Twitter said the post violated its “abusive behaviour” policy and removed it. Buhari’s aides were incandescent with rage; on June 4, the government banned Twitter from operating in Nigeria, provoking worldwide condemnation.
To be sure, the ban was utterly irrational because, apart from being an attack on free speech, it undermined the economic welfare of Nigerians and the country as a whole
To be sure, the ban was utterly irrational because, apart from being an attack on free speech, it undermined the economic welfare of Nigerians and the country as a whole. The polling agency NOI Polls estimated that about 39.6 million Nigerians use Twitter, 20 per cent of them for business advertisement and 18 per cent to look for employment. Other estimates showed that Nigeria immediately lost N6bn from the Twitter ban.
But instead of beating a sensible retreat and unbanning Twitter, the Federal Government said it was negotiating with the organisation the conditions for lifting the ban. On August 12, the information minister announced the purported outcome of the negotiation. Speaking after a Federal Executive Council meeting, the minister told journalists that the Federal Government would soon lift the ban on Twitter as the social media giant had agreed to comply with the conditions imposed on it. He later told Reuters that Twitter had agreed to seven of the Government’s ten conditions. Twitter did not confirm this beyond saying that it had talks with the government and “look forward to our services being restored soon”.
If the conditions announced by Lai Mohammed are enforced, they would subject Twitter to stringent government controls. For instance: Twitter must: register as a company in Nigeria, with a Nigerian Office and staff of management cadre; register with relevant regulatory authorities, such as the Nigerian Broadcasting Commission, NBC; and agree to a charter of online conduct for content management, allowing government to decide which content is acceptable, and which is not! This is a leaf straight from the draconian media bills!
The government invokes provisions of the Companies and Allied Matters Act of 2020 that require foreign companies intending to “carry on business in Nigeria” to be incorporated in this country. But Twitter is open service; although serving the entire world, it has just about 35 offices worldwide.
Under the Electronic Commerce Agreement, currently being negotiated at the World Trade Organisation, e-commerce businesses can transmit products and services digitally or electronically to a country without being incorporated there. It is inconceivable that CAMA 2020 is so backward-looking as to treat foreign online or digital businesses transmitting services electronically to Nigeria as “carrying out business in Nigeria” for the purposes of incorporation under section 78 of the Act.
Besides, if Twitter had not “insulted” Buhari by deleting his offensive tweet, the Federal Government wouldn’t have asked it to be incorporated in Nigeria. Indeed, after Twitter’s choice of Ghana as its Africa HQ, the minister of information merely regretted the decision while adding: “I think Twitter has the prerogative and exclusive right as to where to site its headquarters”. At no point was any provision of CAMA 2020 invoked or the need for Twitter to meet any operating condition mentioned. Which makes the Federal Government’s conditions for lifting the Twitter ban an afterthought and a punitive measure?
But it’s self-defeating, in a globalised world, for an economically fragile country like Nigeria to treat global corporate giants like Twitter with hostility; that signals to foreign investors that it’s not open for business. Truth is, the world is shunning Nigeria; it’s not beating its path to Nigeria’s door!
Last week, a report by the United Nations Conference on Trade and Development, UNCTAD, showed that Nigeria only received $3bnout of the $75bn foreign direct investment that came to Africa between 2015 and 2019. That’s just four per cent! The same report said FDI flows to Nigeria decreased by 48.5 per cent in 2020, compared to 2019.Simply put: Nigeria repels foreign investor.
But why? Well, apart from the harsh operating environment, Nigeria lacks respect for the rule of law. For instance, the UNCTAD report cited inefficient judicial system and unreliable dispute settlement mechanisms as some of the reasons why foreign investors avoid Nigeria. Thus, despite laws like CAMA 2020 and the Petroleum Industry Act 2021, foreign investors don’t trust Nigerian ministers and courts to implement and interpret them faithfully, as the government’s misuse of CAMA 2020 to punish Twitter shows!
Truth is, the hostility towards Twitter will worsen Nigeria’s already poor investment image, and harm investor confidence. An incredible act of self-harm!
