“Most of the problems a President has to face have their roots in the past.” US President Harry S Truman, 1884-1972.
During the presidential campaigns, a candidate made a lot of promises to Nigerians and the rest of the world because we now live in a global community. He might eventually get to work on his agenda; but, when he officially steps into Aso Rock, he will discover that the most pressing problems he is called upon to solve are deeply rooted in the nation’s past. Seven of them are actually time bombs – which Buhari lacked the intellect and the courage to address.
Instead of facing them head-on, Buhari pushed them forward by borrowing to evade them, until he has turned each crisis into calamity.
The seven most urgent and serious are: fuel subsidy removal, national debt, federal government generated revenue, youth unemployment, insecurity, food scarcity and a nation divided.
“An examination of the records of those Presidents, who have served eight years, will disclose in most every instance, the latter part of their term has shown very little in the way of constructive achievement.”
US President Calvin Coolidge, 1872- 1933. Only two elected Presidents have served two terms – Obasanjo and Buhari.
My book PDP: CORRUPTION INCORPORATED has revealed how Obasanjo’s second term in office merely deepened the corruption which started with his launching of the N10 billion Poverty Alleviation Programme, PAP, in June 1999. There was apparently some restraint during the first term in office. All caution was thrown to the winds from 2003 to 2007. Nobody can provide a report of what happened to $13-16 billion taken to increase power supply to 10,000MW.
Nigeria is worse off today than in May 29, 2015 when Buhari stepped up and he promised to do better than President Jonathan. In many respects, Buhari’s second term was less productive than his first. He leaves us with economic indices and social trends which induce fear and despair.
As the new President is coming in, the nation is more divided along political, ethnic and religious lines than ever before. Yet, a minimum of national cooperation is required to solve the problems. Perhaps that is the place to start.
NATION DIVIDED
“A house divided cannot stand.” We all know that. But knowing something and acting on our knowledge are two different things. Most drug addicts, as well as most habitual drunkards know too well that the stuff is harmful to them. But, they are powerless to change – especially when they have many friends who are also fully addicted. Groups are frequently more intractable to change than individuals.
Right now, we are not just divided; we are on the brink of violent conflict in some respects. Surprisingly, the election provided no clear winner, if by that we mean somebody who collected at least fifty-seven per cent of the votes; 63 per cent voted against him. In any other nation practising the Presidential system, this sort of outcome calls for a run-off between the first two finishers. It is not clear if the Nigerian constitution allows for that. Because this article is being written before the final court decision, it will be difficult to customise the advice given to the ultimate winner.
But, some problems are prevalent; anybody following Buhari is heading for an economic and a social quick sand – with a divided nation behind him.
His first duty to himself and country is to try and bring us together. Nothing significant can be built if some are tearing down what was constructed.
FUEL SUBSIDY REMOVAL AND CONSEQUENCES
“Courage is the most admirable of human attributes.” Ernest Hemmingway, 1891-1961.
Nigeria has had leaders with different characteristics. But, in my opinion, we have not had one with the courage required to solve the problem of fuel subsidy. I quite recollect my first long tour of the South East and South South in 1975.
It lasted nine working days and I touched all the state capitals at the time. Fuel was sold at three kobo per litre and it was subsidised. It was later increased to seven kobo. The Federal Government, under Shagari attempted to deregulate and remove the subsidy.
Threatened by the Nigeria Labour Congress, NLC, with a strike, the FG backed down. That has become the pattern till today. Government proposes what it considers to be in the best interests of the country; NLC barks; government backs off and continues with the ruinous policy of subsidy payment.
Unfortunately for the nation, our previous leaders ignore one fact. Any nation which allows an untenable situation to go on, for too long, will eventually discover that there are no painless options left. The current discussions between the FG and NLC represent exercise in futility. Both sides are attempting to find an alternative which will lead to moderate increase in fuel price without triggering another round of inflation. The truth is; there is none.
Here is why. There are only two basic ways by which governments pay for subsidy; by raising taxes or by borrowing. Raising taxes (and collecting them) means that the present generation of consumers are paying for the subsidy enjoyed indirectly. Government gives with one hand and takes back with the other. Subsidy payments covered by debt, particularly long term, implies that the current generation of Nigerians are consuming and passing the bill to our children to pay. Anyway you look at it,
somebody pays.
A leader, seeking to end subsidy, must first of all develop strong will. He must also recognise that surrendering to the pressure of those claiming to represent the “voice of the people” is almost always the pathway to disaster. Two sages have warned leaders succumbing to cheap popularity and avoiding tough decisions.
Alcuin, 735-804, advised as follows: “Nor should we listen to those who say “The voice of the people is the voice of God (vox populi, vox dei), for the turbulence of the mob is close to insanity.” To that Nelson Mandela, 1918-2013, added.
“There are times when a leader must move out ahead of the flock, go off in a new direction, confident that he is leading the people the right way.”
The truth is; fuel subsidies must go as soon as possible. It is no longer affordable; it also distorts the economy. By pricing fuel too low, we encourage consumers to use more.
DROWNING IN DEBT
”FG says debt sustainability threatened by low revenue.” Report, NOVEMBER 18, 2022. “IMF knocks Nigerian fiscal and monetary policies.”
Report, NOVEMBER 22, 2022. A great philosopher once observed that “the climax of every tragedy lies in the deafness of its heroes.”
Nigeria has been in this situation before. In 1984, the military regime led by Major-General Buhari discovered that the nation was indebted beyond its ability to repay from current revenue. The only difference between now and then was the fact that the price of crude oil dropped rapidly making it more difficult to pay. In 1985, General Babangida replaced Buhari and inherited the debt burden.
Asking our creditors to allow Nigeria to postpone repayment, instead of defaulting outright, was the approach taken from 1985-1993 while IBB was in charge.
Meanwhile, penalties increased the debt stock. By the time President Obasanjo came to power, the debt stock had reached $36 billion and there was no way we could pay that and still have funds for development.
Nigeria was among several poor countries pleading for dent forgiveness. Then, in 2004, as the price of crude oil started climbing
again, the country was able to reach an agreement with the creditors. The nation was allowed to repay $24 billion and $12 billion
was forgiven.
For once, we were technically debt-free. But, what led to the huge debt burden? Three things: fuel and other subsidies, low
revenue generation, economic mismanagement, over-bloated public sector and corruption. No sooner were we relieved of our debt burden than we embarked on taking new loans and dissipating them as we did before.
Buhari alone was not responsible for the debt stock the new President has inherited. Buhari has only been responsible for the highest increase in debt by any President before him. He has also left the nation in the weakest position to repay and fund economic development at the same time.
No new President has faced such a nearly hopeless situation as this one – since Buhari himself succeeded Shagari in
- Buhari has made the problem a little more difficult for the new President in two ways.
First, by taking the $800 million loan facility from the World Bank; and second by spending most of the full-year revenue for 2023 before his departure in May. Consequently, the new President will inherit the inevitable national rejection of subsidy removal.
“Why debt burden will worsen for Nigeria, other low-income countries – IMF” Report, April 12, 2023.
Finally, even if Buhari can be responsible enough to stop borrowing more, legally and illegally, the new President will face a heavier
burden for some of the reasons mentioned by the International Monetary Fund. Only one will be mentioned here. “Developing countries may face mounting debt and insufficient support…with ballooning inflation, escalating borrowing costs, and a strong dollar jacking up the cost for borrowing countries [like Nigeria] to repay loans and raise fresh money.” The most urgent problem facing the new government is how to obtain the funds to run government without going into more serious debt. His options are limited.
Nevertheless, here are a few for consideration; they are presented without elaboration. Sharply reduce cost of running the government.
· Increase revenue generation by MDAs; consider scrapping or merging units ·Understand that Buhari’s “borrow-and-spend” approach to public finance must come to an end.
•Above all, appoint a competent Chief Economic Adviser and a Minister of Finance with a great deal of international exposure and network; listen to them and not the mob
FG REVENUE GENERATION
“FG fails to recover N8tn taxes withheld by IOCs, others.”
Report, APRIL 9, 2023.
If there is one word recurring in every report, either official or by third parties, with regard to revenue generation by the Buhari administration in eight years, the word is FAIL. In eight years, the Buhari administration:
•Failed to collect the revenue budgeted
•Failed to live within its means
- Failed to reprimand the MDAs which fell drastically below their budgets •Failed to keep MDA’s expenditure within revenue limits
•Failed to recover full taxes and revenue from IOCs and others
•Failed to prosecute diligently those owing AMCON N5trillion and recover the revenue instead of borrowing
•Failed to stay within the budgeted deficit spending; instead exceeding the budget every year.
•Failed to stay within the legal limit for borrowing under Ways and Means, W&M, until a huge debt of N23.7trn had been illegally accumulated
•Failed to account for $2.4 billion crude oil sold in 2015 by the Minister of Justice without remitting the proceeds to the Federation account.
•Failed to curb the theft of 400,000 barrels of crude oil per day.
•Failed to restore Toll gates on highways.
•Failed to privatise refineries.
The list of failures is actually longer. But, why go on? The next President will discover that Buhari and his Ministers of Finance preferred to go around, bowl in hand, borrowing, instead of collecting what is owed to the FG. There is a method to what might appear as madness. It is highly lucrative to allow debtors to go free, and to borrow unnecessarily. The officials involved receive
“returns” both ways. Debtors pay and most creditors also pay those who direct business their way – after all they make money when
they lend.
So, one quarter of a percentage tagged on to a $10 billion loan is a lot of money in Naira. These guys have collected about $24 billion; mostly in loans which could have been avoided.
“Fuel subsidy, oil theft gulped N29tn, says FG.”
On April 14, 2023, the FG announced that N13tn was lost to fuel subsidy from 2005 to 2021; and N16tn to oil theft between 2009 and 2020. When the figures for 2020 to 2023 are added, the new President would realise how Nigeria’s past, present and future were wasted by his predecessors – especially Buhari. In all these, nobody was arrested and prosecuted.
YOUTH UNEMPLOYMENT
“Nigerian unemployment rate to hit 41% in 2023 –KPMG.” Report, APRIL 11, 2023. Granted, aggregate unemployment rate has been climbing for more than thirty years – propelled by youth unemployment. As we establish more universities – Federal, States, and Private – and expand admission in each category, we also steadily increase the number of graduates each year. What would have been a positive development by itself is creating a massive problem, called “a time-bomb” by some
people who have studied the problem carefully.
Millions of our jobless university graduates have been joined by Polytechnic graduates, other graduates of tertiary institutions, as well as, secondary and primary school leavers to form the largest pool of able-bodied but idle people on the Continent and the world.
How did we get here? The report has this to say.
“Nigerian unemployment rate had increased to 37.7 per cent in 2022 and will further rise to 40.6 per cent [in 2023] due to the continuing inflow of jobseekers into the job market…unemployment will continue to be a challenge due to the slower-than required economic growth and the inability of the economy to absorb the 4-5 million new entrants into the Nigerian job market every year.”
This relentless missed-match between job seekers and available vacancies, which is not peculiar to Nigeria, results from several imbalances in the economic environment – low job creation, decreasing Foreign Direct Investment, FDI, technological changes and the output of unemployable graduates by schools at all levels.
Nigeria’s educational institutions are not training the youths for existing jobs. The majority are not ready to operate in the modern work environment.
Technology continuously replaces people. A good example is the Central Bank’s pursuit of cashless banking; which is wiping out more jobs in the financial sector than it will ever create.
Most new vacancies are in the technology sector – calling for more competence in information technology; while most of our graduates are reading something else. The new President will have to address the growing phenomenon of youth unemployment
because its consequences are already known to us – horrible crimes, Yahoo boys, monumental drug addiction etc. The Devil, a ceaseless employer of idle hands, is busy engaging our kids – but, not as we wish.
INSECURITY
“Former Nasarawa Deputy Governor kidnapped. Report, APRIL 8, 2023.
“400 dead in Benue three weeks of massacre.” Report, APRIL 9, 2023.
“Gunmen kidnap 333 Nigerians in six weeks.” Report, APRIL 9, 2023. “Insecurity: 1,266 killed, 4,973 kidnapped in 15 months – Kaduna govt.”
Report, April 20, 2023. Start with the first and third reports; which inform us that eight Nigerians were kidnapped per day, on the average in this country. We might soon add the Kidnapping Capital of the World to World Poverty Capital at the rate we are going. Nobody is safe anymore. Obviously, no foreigner will want to invest here. Even Nigerian investors might
“japa”.
The series of massive massacres which spread round the nation between 2016 and now started in Agatu, Benue State in April 2016. Over 300 people lost their lives and properties were destroyed. Neither the President, nor the Vice President, nor any member of the Buhari government paid a visit. No condolence message was sent; no relief materials were dispatched.
The President of France, at the time, cut short a State visit and returned home when a terrorist attack occurred in Paris, in which six people were killed.
He visited the bereaved families and personally took charge of hunting down the terrorists and eliminating them. Buhari and his government were so myopic, they did not realise that Agatu was rehearsal for herdsmen. Since then, they have killed, kidnapped, maimed and driven out hundreds of thousands of farmers.
They have started again with Benue in 2023. I wrote a three part article, after visiting Agatu warning that the attack on Benue, a major food producer state would result in food scarcity nationwide later. We have worsening food scarcity now. Unfortunately, that is only one of the security problems the President must solve very quickly. Post-election violence might occur after the Court verdict.
FOOD SCARCITY PRODUCT OF BANDITRY AND FLOOD
“Terrorism: Hunger looms as farmers abandon farmlands in Kaduna.”
Report, APRIL 11, 2023. ”Benue killings: Declare state of emergency on security now, Tribal leaders tell FG.” Report, APRIL 11,
2023.
“Sokoto community “war “ against kidnappers sparks Hausa, Fulani clash.”
Report, APRIL 12, 2023.
Acute food scarcity appears unavoidable in 2023 for two reasons – renewed banditry and flood. The first is 100 per cent our fault; the second is about 50 per cent the fault of governments at Federal, State and Local levels, as well as our own for not holding them responsible for their individual and collective dereliction of duty.
Our leaders are steadily starving us to death and making the living severely malnourished. The reports above will serve as our points of departure for this segment.
Those who might not know the contributions of Benue and Kaduna states to our national food production might also not realise how imperilled our food supply is on account of the renewed acts of terrorism in those two states.
Having been involved in farming in the North for several years, and being a regular traveller to all the states of Nigeria and the Federal Capital Territory, it is my estimate that the two states account for close to fifteen percent of our food output. Together, they certainly provide more food than all of the South East and half of the South South.
It would have been bad enough if only those two states remain under siege. Unfortunately, banditry in Nigeria knows no boundaries. When the mayhem started in Agatu in 2016, few people were discernible enough to foresee it becoming a national tragedy. A great deal of the food scarcity and food inflation we now experience had their origins in the Agatu invasion. No amount of food importation, assuming we have the money, can make up for what Nigeria stands to lose if large areas of Benue and Kaduna are taken out of cultivation.
I lived and worked in Sokoto in the late 1980s to early 1990s; managing the largest and most modern rice mill in Africa at the time. Working with others, we persuaded the Babangida regime to pursue the Fadama project. At the heart of the agricultural transformation was the erection of the Goronyo Dam – which turned arid Sokoto state into another food basket. A prolonged ethnic war between Hausa and Fulani, in the North, will increase the percentage of imperilled food sources to close to 30 per cent after Benue and Kaduna.
CONCLUSION
“Food first” would have been the advice given to any leader just coming into office. But, that only applies in a nation where food supply itself is not threatened by pervasive insecurity. In a nation, such as ours, where farmers cannot safely go to work, where schoolchildren and workers are freely kidnapped and gunmen kill policemen and soldiers at will, security has trumped everything else.
Yes! We need more power supply, more jobs, better healthcare, improved education, and smooth roads. But, preservation of lives and property is the first duty of government. The new President has a whale of a task before him—particularly with millions of illegal arms in the possession of hoodlums. He will not go far without improving on security.
VANGUARD
