One year on, the euphoria that greeted the Buhari administration has all but faded. Hope has been replaced by quiet resignation. The dire economic situation in the country has affected almost everyone. The worse hit have been pensioners and millions of workers in the private and public sectors that are owed several months of unpaid salaries, some as much as a year’s salaries. Projects across the land have stalled and thousands of workers laid off because of non-payment of contractors by both state and federal governments. Youth unemployment is at its highest ever, fuelling crime and providing ready recruits for insurgents and agitators across the land. An Abuja resident remarked that people were being kidnapped for a recharge card. Nigeria indeed is in recession in all but name. After years of reckless behaviour and unashamed thievery by previous administrations, the chicken has indeed come home to roost.
Although President Muhammadu Buhari assumed office at the worst possible time in our history, the challenges facing the country could not have come to him as a surprise. They were evident before the elections when oil prices began to fall dramatically. I wrote about it back in November 2014 in my article, “Nigerian economy: Difficult times ahead as oil price plunges”. This was followed by Prof. Chukwuma Soludo’s excellent treatise in January 2015: “Buhari vs Jonathan: Beyond the election”. For daring to tell the truth, the good professor was maligned by the elite. Sadly, we’re now living out his predictions.
Whilst the President hit the ground running on the fight against Boko Haram, there seems to be no clear strategy for dealing with the economic challenges he inherited. Although the Jonathan administration had left the patient in an intensive care, the delay in appointing ministers compounded the nation’s economic woes, paralysing economic activity, as businesses waited and waited for policy direction from government.
The 2015 budget saga further exacerbated the peoples’ frustration that the President might not be in control after all. The whole process was embarrassing to say the least and sent the wrong message about the competence of the administration. The President, no doubt, was let down by his advisers. Ministers allowed civil servants to pull wool over their eyes, believing the budgetary projections they were proposing were robust and based on a zero-based budgeting methodology. Public scrutiny suggested otherwise. Given when ministers were appointed, it would have been impossible to deliver a zero-based budget within that short timeframe. I write as someone who led the budgeting process in public institutions in the United Kingdom for over 10 years.
It is unacceptable that a country like Nigeria with a huge infrastructure gap and millions unemployed should start implementing its budget half way through the fiscal year. The fact that this was normal practice by previous administrations does not make it right. Timely budgeting is critical for Nigeria’s development and both arms of government must take this function seriously. There is no reason why future budgets cannot be implemented from January 1 if the will is there on the part of government. It will require discipline and proper planning to ensure that budget proposals are submitted to the National Assembly for deliberation by October prior, the latest. This is the change Nigerians are looking for.
Power continues to pose the biggest challenge to economic development in Nigeria. There is a need for government to be frank with Nigerians on the challenges we face in this area. Sabre-rattling and threat of strikes by labour unions will not build one power station– someone has to pay for it at the end of the day. What is needed is constructive dialogue with government. Power infrastructure is not cheap. The British government,for instance, is planning to build a nuclear plant (Hinkley Point) to power six million homes in the UK. The construction cost alone is estimated at over £20bn, more than the federal budget. The funding for the project will come from the EDF (a French energy company) and China in a public private partnership arrangement. The government must explore innovative ways of addressing power shortages that involves the private sector and citizens.Options could include making it mandatory for solar panels to be installed in all new buildings in our towns and cities, thus reducing the pressure on the national grid. Even in a country like Britain where they have adequate electricity, homeowners are encouraged to install solar panels in their homeswith part of the cost subsidised by government.
However, to assess this administration’s scorecard based solely on current economic indicators will be unfair. There is a sense that the government is now beginning to address the scourge of corruption in the country. Corruption is no longer as brazen as it used to be when there was no fear of consequences. The government has quite rightly set the tone that this behaviour is unacceptable. However, it is important that the fight against corruption is underpinned by the rule of law and not seen as a vendetta against political opponents. The next phase must now be to improve corporate governance in our public institutions and put in place structures to prevent corruption in the first place.
The success of the military in retaking huge swaths of Nigerian territory from Boko Haram in just under a year is nothing short of remarkable, credit to the President. This was the same army that hitherto were on the run from the insurgents. Equally remarkable was the speed with which the President galvanised international support for the fight against terrorism. The President must now resolve the menace of the marauding Fulani herdsmen once and for all – this is a smouldering fire that can become another inferno.
The removal of fuel subsidy and the floating of the naira would rank as one of the best decisions we ever made as a country, jettisoning policies that had stifled the country’s development for decades. The positive impact of these two policies on the economy cannot be overstated. The N1tn recurrent expenditure hitherto spent on petrol subsidy can now be invested in our hospitals so that the vast majority of Nigerians who cannot afford medical treatment in Europe or India may have a chance to live. The policies will remove the huge arbitrage that caused scarcity and created massive opportunities for fraud. Billions of foreign exchange spent in subsidising education and the health service of other countries will be saved and spent at home creating our own jobs and building our own public infrastructure.
As we move to the next chapter of this administration, the government must focus on infrastructure development as a means of creating jobs for the millions of unemployed youths. This will help address the conflicts in the Niger Delta and the agitations in the South East as youths become gainfully employed.The fight against corruption must not relent.
current challenges, I still have great hope for a better Nigeria. However, the president must continue to listen to good counsel and learn lessons from the past year.
PUNCH
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