Even though the naira was still very strong at the exchange rate of 60 kobo to a dollar (yes, in this same Nigeria!) and graduates could afford to be choosy when it came to employment and career prospects, there were tell tale signs by mid 1981 that the economy had begun to wobble. But President Shehu Shagari and his Second Republic civilian administration chose to live in denial.
However, on his way out of the country for vacation on 4th July that year, the late Chief Obafemi Awolowo released to the media copies of a letter he had sent to the president three days earlier. “There is a frightful danger ahead visible for those who care and are patriotic enough to look beyond their narrow self-interest. Our ship of state is fast approaching a huge rock; and unless you, as chief helmsman, quickly rise to the occasion and courageously steer the ship away from its present course, it shall hit the rock,” Awo warned in the letter.
Two days later, President Shagari replied, defending his government against the charges made by the man he defeated at the 1979 presidential election. But while the president was civil in the letter, even starting with an endearing “My dear Chief”, his Special Adviser on Economic Affairs, Professor E. C. Edozien, went for the jugular. “Recently, certain quarters have embarked on a campaign calculated to generate doubts about the real state of the Nigerian economy. It is clear now that this campaign is not only ill-motivated but constitutes a disservice to the people of the country who are the final victims of the campaign to destroy the economy by instilling a lack of confidence in it both within and outside Nigeria. The most unfortunate element is that it has, by manipulating easy facts and drawing illogical conclusion from wrong premises, attempted to misinform Nigerians about the true state of our economy”, Edozien wrote.
The late Chief Adisa Akinloye, National Chairman of the then ruling National Party of Nigeria (NPN), went a nudge further: “Chief Awolowo’s attempt to paint the country as economically and politically unstable is not only unpatriotic but the height of falsehood. As a matter of fact, one of the top priorities of the NPN administration is the preservation of peace and stability in spite of all attempts by Chief Awolowo-led confrontational gang of subversive governors who call themselves progressives”, said Akinloye before adding, “the Nigerian society would take Awo seriously the day he can stop his ethnic politics reinforced with hostile utterances”.
For weeks, the NPN attack dogs and all manner of hacks with some elementary understanding of “demand and supply” were let loose on Awo who, upon return to the country, addressed the media to reply the criticisms directed at him for his letter: “I say again, as I said a little over two months ago, that our economy ails critically. For saying this–which is obvious–I was abused… many of our so-called economic advisers are victims of micro-economic illusions.”
Only six months down the line, Awo was proved right when the economic problems began to manifest and the Shagari government had to come up with the austerity measures that proved ineffectual until the civilian administration was toppled by the military led by a certain Major General Muhammadu Buhari in December 1983.
That background is essential because it shows that obduracy and refusal to accept criticisms, however well meaning, is a peculiar malaise with those who superintend our country at different epochs. But it is worse under this administration where those who offer alternative positions to ill-digested policies that are clearly not working are either branded with the well-worn and meaningless tag of “corruption is fighting back” or are dismissed as “wailing wailers”. It is within that context that we can situate the current attempt to demonise the Emir of Kano, Muhammad Sanusi II, for his intervention on the state of our economy last Friday.
As a member of the NigeriaCollective, an evolving think-tank much like the British Chatham House, which collaborated with the Savannah Centre for Diplomacy, Democracy & Development to organise the event, I know it was meant to be a dialogue session for a select audience. I was not even aware it was meant to be covered by the media but with a benefit of hindsight, I think it was good it became a public event. Aside the emir, there was former Anambra State Governor, Mr Peter Obi who said most notably in his intervention on “Reducing the cost of governance” that conventional wisdom should teach those in authorities in Nigeria today that when you are in a hole, the first responsibility you owe yourself is to stop digging.
Under the theme “State of the Nigerian Economy: Threats, Challenges and Opportunities”, other speakers included former Chief Economic Adviser to the President under the Obasanjo administration, Prof. Ode Ojowu whose intervention was on “The economy: Seeking an exit from stagflation”; former CBN Deputy Governor (Economic Policy), Dr. Obadiah Mailafia, who spoke on “Monetary policy in a recessionary period”; Statistician-General of the Federation, Dr. Yemi Kale, who spoke on “The growing youth unemployment” and my sister, Mrs Fatima Wali-Abdulrahman whose intervention dwelt on the much-neglected mortgage industry. Chairman of the occasion, Alhaji Bashir Tofa simply chose to play the role of a moderator.
While the exchanges were interesting, it was no surprise that Sanusi’s presentation raised all the dusts. In a way, he himself saw it coming because at a point, he hesitated to ask the organisers about the role of the media at the event. He said he would not want to be presented as attacking the federal government and that the essence of what he had to say was to provoke a debate about the future of our country.
The emir started his presentation on the premise that the years of ‘Africa Rising’ were driven by two major factors that are no longer in contention today: A dramatic rise in the purchasing power of raw commodities and a rapid increase in public sector borrowing which was used to stimulate consumption. The implication, according to Sanusi, is that growth can only come through investment even when he admitted we made some wrong choices in the past. For instance, like many countries that rely on revenues from commodity, the growth in public wage bills has increased progressively in Nigeria such that from N443bn in 2005 it rose to N1.66 trillion in 2012.
While no one can deny that the Muhammadu Buhari Administration inherited serious problems, compounded by the falling price of crude oil, the question the Emir posed is: If we accept the conclusion that the government balance sheet is stretched and investment is the key to growth, why has the Federal Government pinned its hope of a recovery on massive fiscal expansion and a forex policy that basically deters investment?
Nigeria, according to Sanusi, introduced bold forex reforms earlier this year, and then completely failed to implement them. That yawning gap between policy and implementation, he argues, now impacts negatively on credibility. “After announcing a (managed) flotation of the naira in June, the CBN instead implemented a hard peg (at a lower level). The FX market is now split into four different segments: the CBN rate (N305/US$), FMDQ (N315/US$, but not printed since 28 November), NIFEX (N315/US$) and the black market rate (N480/US$)” said Sanusi.
The “Fair value” of the naira, Sanusi believes, is not the issue in contention today. “The current crisis of confidence in NGN/US$ comes from a lack of transparency and functionality. On a trade and inflation weighted basis, the naira has gone from one of the most over-valued currencies in the world to one that is now under-valued. This suggests that Nigeria is comparatively cheap – and indeed much cheaper than many countries with a long history of attracting capital from abroad,” he argued.
Interest rates are not the issue either, he further argues even as he admits that in tandem with its currency reforms, the CBN has restored positive real interest rates while pointing out that the changes have been dramatic: as recently as January, real interest rates were deeply negative in Nigeria. “However, local currency returns are now among the most attractive in Africa, as well as the wider frontier universe. Under a more credible policy environment, this would help draw in capital from abroad, and incentivise locals with savings to keep their money onshore” said Sanusi.
The issue on which the emir was most critical is in the relationship between the federal government and the CBN, an institution he contends is no longer independent. “In fact one could argue their relationship has become unhealthy. CBN claims on the FGN now top N4.7trn – equal to almost 50% of the FGN’s total domestic debts. This is a clear violation of the Central Bank Act of 2007 (Section 38.2) which caps advances to the FGN at 5% of last year’s revenues. The overdrafts alone are equal to more than 10 times that prescribed limit, and are growing every month” he said.
Both the presidency and the CBN have picked on this, using the money accumulated into the Treasury Single Account (TSA) as a defence. Yet, even with my elementary knowledge of economics, I know that the money in the TSA is not a federal government reserve. But even at that, Sanusi’s intervention was not all about criticisms. He also offered his own ideas on the way forward.
On what we should be doing, the emir said Nigeria should gear its policies towards attracting investment; implement the June 2016 FX reforms which were designed to unite the market in single, transparent rate while focusing on reducing FGN debt service through greater concessional borrowing rather than increasing its spending through CBN financing. The bottom line, in his words: “Until Nigeria signals a clear change in policy it will be difficult for it to restore credibility; Until credibility is restored, it will be difficult for it to attract investment (both from at home and abroad); Until investment picks up, it will be difficult for Nigeria to return to growth.”
Other suggestions from Sanusi include closing the gap between foreign exchange policy design and implementation; shifting the focus of fiscal policy towards reducing debt-servicing costs; eliminating fuel subsidies; raising more concessional funding from abroad etc.
For sure, it is possible that Sanusi was wrong in his diagnosis of our economic challenges or prescriptions for addressing them. But I recall that he himself admitted that he could be faulted and that he just wants us to have a meaningful conversation on the way forward since most of the policy prescriptions by the government appear not to work. That, any rational person would argue, is fair enough. But the real problem is that this government enjoys shutting down anybody that as much as criticize it. Engineer Buba Galadima who, for decades, was one of the closest allies of President Buhari is now being assailed by those whose association with the president started only yesterday just because Galadima is critical of the government. And now the emir of Kano is also a “wailer”.
It is very evident that this government wants only those who will be shouting “no one but you” to the president, even while saying different things behind his back: The men and women who would be the first to flee when things go wrong. I have read from some of them in the last week since Sanusi’s intervention as they sell their dubious propositions. Yet, in his piece, “We must never forget the lesson of Orwell’s 1984”, Richard Lederer wrote about how the great novelist, in his last work on tyranny and totalitarianism “warned us that dishonest language is a drug that can put conscience to sleep.”
All said, readers of this page are well aware that my favourite Nigerian actor is Alhaji Kareem Adepoju aka Baba Wande who I consider a genius at his craft. My adoration for the great man started from the time of the late Oyin Adejobi when he was the star attraction in epics such as ‘Ekuro Oloja’, ‘Kuye’ etc. But the play that I would never forget is the one titled ‘Oba Igbalode’ which can be translated to mean ‘Modern Day King’ where Baba Wande played the role of palace jester by name Gbajuma.
The play begins with the enthronement of a new king (Tafa Oloyede) who, without consulting the chiefs, made proclamations that were clearly antithetical to the peace of his community. In doing all these, including breaking with sacred traditions, the chiefs knew the king was on the road to perdition, were hailing him, essentially because he had threatened that anybody not supportive of his ideas would be deemed disloyal, stripped of his title and sentenced to death.
However, the palace jester (Gbajuma) felt that things were not right and he confronted the chiefs about why they were misleading the king. They told him that even when they were well aware what the king was doing would eventually land him and the community in trouble, they had to preserve their own lives. But when Gbajuma could no longer stand the hypocrisy playing before him, he shouted down the chiefs who were hailing Kabiyesi, chanting: ‘Maa se nso, apa re oka’, meaning “continue, you can do anything”. Not minding that he was just a palace hand, Gbajuma said: “You these chiefs, please don’t help in pushing our king into his destruction.”
While the chiefs tried to prevent Gbajuma from remonstrating with the king, knowing the consequences of such action, he refused to listen to them. But if Gbajuma was circumspect, he would have seen from the king’s menacing countenance that trouble was lurking.
Without mincing words, Gbajuma told the king that what he was doing would end in his destruction and that the chiefs were not acting in love but purely in promotion of self-interest. Gbajuma said he loved the king and would not want to see him end up in ruins as it was bound to happen if he continued on the path he had chosen. About five minutes into his monologue, the visibly angry king stood up and cut him short. After upbraiding the palace jester for his ‘disloyalty’ and acting beyond his station, he pronounced on him a death sentence.
For ‘daring’ the all-knowing king, the town crier was to be fed a mixture of cement and garri but due to the intervention of the Queen who had affection for him, Gbajuma was saved from the death sentence. And following that near-death experience, Gbajuma vowed: “Since the king does not like the truth, all of us will join in pushing him and the town into the abyss”.
That was how Gbajuma became the number one sycophant in town; hailing the king as he desecrated the throne to the detriment of his community.
Please don’t ask me how the story ended. But it is my hope that the Buhari administration will tolerate constructive criticism of its policies, especially from friends of the administration, however unpalatable.
Jammeh: Even a Dictator Has His Day
The eccentric president of The Gambia, Mr Yahya Jammeh surprised the whole world last Friday when he conceded defeat in a presidential election everybody expected him to, as usual, rig! In fact, there were already plans in London by The Gambian citizens in the Diaspora to stage a protest before Jammeh took the wind out of the sail of the agitators. And as we try to make sense of what just happened in The Gambia, I recall my piece published on this page on 4th August 2011 which is quite revealing not only of that small West African country and his defeated dictator but also the political undercurrents in Nigeria at the time. It is titled “H.E. Sheikh Professor Alhaji Dr…”
I concede that the title of this column is very unusual but then I am in an unusual country at a very unusual season in my own country, Nigeria. I am writing this column from Banjul, capital of The Gambia, where I arrived on Sunday as the keynote speaker at the conference on “Media and Economic Development in a Globalising World” organised by the Commonwealth Secretariat in London. The discussions here have been rather interesting and while my address on Monday was critical of the media landscape in The Gambia, which I described as hostile to journalism and restrictive of free speech, both their Minister of Foreign Affairs and his Information and Communication Infrastructure counterpart were nonetheless gracious to me after my presentation.
However, considering that this is my first time in The Gambia, I have also been taking notes and I want to say that even with all the challenges we face as a nation, and despite the failed promises, I still feel very proud to be a Nigerian. Meanwhile, the title of this piece is also the official title of the president of The Gambia which is embossed on all his portraits that litter the country and it is the way he is addressed by government officials even when he is not present.
Every official speaker at public events as well as newscasters on their public television (no private station in the country) begins by reminding the audience of the great accomplishments of “His Excellency Sheikh Professor Alhaji Dr. Yahya Abdul-Azziz Jemus Junkung Jammeh Naasiru Deen, Commander in Chief of The Armed Forces and Chief Custodian of the Sacred Constitution of The Gambia”. And the way they do it, you would assume it has already been crammed almost as a national anthem in the country.
The Sheikh title came about because the president is an ‘Islamic scholar’ and everywhere he goes, he carries around a Quran and a sword. For holding a Quran all the time, that makes him an Islamic scholar and perhaps for that same reason, he is a Professor of Islamic study without ever writing any dissertation! The Alhaji we can understand because he must have travelled to the Holy Land of Mecca several times but then he is also a medical doctor. That title was conferred on him because of his “effective herbal treatment programme in the cure of HIV/AIDS, Asthma, Diabetics, Hypertension, infertility and several other diseases in his quest to save humanity”. That is the official explanation.
At different times, several people are usually paraded as having been cured of one ailment or the other by the president even when what he says at such occasions most often gives him away as a medical illiterate. When Ms Fadzai Gwaradzimba, then country representative of the United Nations Development Programme (UNDP) in The Gambia expressed doubts about these claims which she warned might be encouraging risky behaviour, she was ordered to leave the country.
Yahya Jammeh, who came to power through a military coup d’etat in July 1994 before contesting and winning election in 1996, will be seeking a fourth time (of five years) in office as president in November and it is most likely going to be another coronation for him despite having spent 17 years in power already. On Monday, I watched him on television where at a public event he brought out cash for the people to share and lavish praise was showered on him as a generous man. The same was done with bags of rice he distributed in the spirit of Ramadan to selected citizens.
Now, the essence of my piece is really not on the idiosyncrasy of Jammeh or even to compare Nigeria with The Gambia. I know better than to do that. There are few countries in Africa that compare with Nigeria in terms of socio-economic development (and I have travelled wide within the continent) but that is also not the beef of my piece today. That Nigerians hardly compare our country with The Gambia or any of the countries in Africa aside South Africa is essentially because given our enormous resources and the resourcefulness of our people, we aspire to higher standards.
Ever since the proposal was announced by President Goodluck Jonathan for a single term of longer (than the current four) years for the president and the governors, there has been a serious opposition from the media, the civil society and the political elite outside the ruling Peoples Democratic Party (PDP). Today, it would seem a national consensus is already building for the rejection of the idea even when the president has said he would not be a beneficiary.
There are three reasons why most Nigerians are wary of this ‘single-term’ proposal which I can categorise under three Ts: Timing, Trust and the factor of Tomorrow. In timing, President Jonathan has not even spent 100 days in office when he elevated to national discourse the idea of tenure ‘elongation’ which has always been a hot-potato issue.
The second factor is that of Trust. Although the president has said he would not run in 2015 if the idea passes, majority of Nigerians have become rather cynical of such promise. And they have good grounds for that disposition. In Africa, the only man who has made that pledge and kept faith with it is former South African President Nelson Mandela and the whole world is agreed Mandela is a breed apart. Right now in Liberia, a certain Mrs Ellen Johnson Sirleaf who promised to spend only one term as president is already campaigning desperately for a second.
The third reason is what I call the factor of Tomorrow. Let us assume that President Jonathan is indeed able to withstand the ‘pressure’ that will quite naturally come his way to seek a second term in office (either of four or six years), he will most certainly be succeeded by a Nigerian from the northern part of the country regardless of party affiliation. In such event, I foresee a situation where someone would come up (and we have several political mathematicians in our country) to argue that the ‘South’ spent 13 years in power (eight years of Obasanjo and five of Jonathan) while the ‘North’ had spent only three under the late Umaru Musa Yar’Adua.
The argument then, and I have read something like that already, would be that after the new president might have spent six years, the ‘North’ would still lag behind the ‘South’ by four years. This would then necessitate the campaign to go back to the original two terms of four years. Of course, whoever is the president at that particular period could also say he would seek only one term of four years (to complete the 13 years of the North) and hand over power. That definitely is not the way to run a country yet that is usually the beginning of the absurdity that breeds the kind of situation that we have in The Gambia today.
Therefore, I sincerely believe that there are far more pressing issues we have to deal with as a nation than to begin to dissipate energy again on the issue of tenure of public officials. While I do not doubt that President Jonathan means well with his single-term proposal, it is my considered view that given the controversy the idea has already generated, he should weigh all his options before asking himself whether going ahead is really worth all the trouble.
ENDNOTE: As it would turn out, President Goodluck Jonathan eventually sought a second term in 2015 and he lost the election. But he was honourable in defeat thus setting a good example that even a brutal dictator like Yahya Jammeh of The Gambia has now copied. Meanwhile, for the benefit of readers who have been asking when my book, “Against the Run of Play: How an Incumbent President was Defeated in Nigeria” will be out. The due date is February 2017. It will be worth the wait!