It was refreshing to go back to time and re-echo the golden years when the Nigerian economy held great promise shortly after independence. On hand to fill in the lacuna of a historian was Apostle Hayford Alile, a former Director-General of the Nigerian Stock Exchange.
In this no holds barred interview with Jimi Disu, he went down memory lane to reveal how promising life was when the Union Jack was lowered and how we got it wrong and are still being haunted by the avarice and short-sightedness of a few corporate fat cats who tragically didn’t share the vision of our selfless nationalists and brazenly squandered the opportunity to contribute in taking Nigeria to the economic acme.
Sit back and enjoy the ride!
For the benefit of those who do not know who Apostle Hayford Alile is, here is a little biography.
He is an elder statesman; he was once interviewed by Jimi Disu in 1981 when the latter held sway as Deputy Editor of the now rested Financial Punch. He was the Director General of the Nigerian Stock Exchange for 24years and was born in April 1940. He was a state scholar in physics, thereafter he proceeded to Harvard University in Massachusetts where he earned his B.A degree in economics and mathematics. He later attended Rutgers Graduate School of Management, New Jersey for his M.B.A and the Harvard business school for his A.M.P.
Jimi: What does being an Apostle mean?
Alile: My church is a spiritual and a Pentecostal one. We chose Apostle as a designation to get a ticket to become the head of the church.
Jimi: As an elder statesman, you have made comments on the economy at least for the past 10years. I remember in the 80s, we had a very robust economy which we thought was bad. I will like to know how you feel as an elder statesman about where we are today politically.
Alile: Although we had our independence in 1960, we could separate the type of independence we had even up till date. There is political independence, but there is no economic independence. The whole country was manipulated to some extent by England and the USA; you hardly saw in those days a situation where the capital base of a company was held largely by Nigerians. When I got to the stock exchange, the capital base of companies listed on the stock market was more than 60%owned by foreigners, so in effect they were dictating the tune of the economy. For that reason, our economy crumbled. In those days when we finally got our independence, we were really a country that had a rural set up, where almost 70-80% of our citizens were in the rural sector and to a great extent our society was seen as an agricultural society. Unfortunately, because of the way and manner the British left, we were completely a non industrial society. They allowed us to pretend to be an industrial society, whereas we were just an agrarian society, with the effect that most of what we ate and drank was always imported and the good things that needed to be processed and to be used in manufacturing were all exported from Nigeria.
Jimi: Do you think we are incapable of ruling ourselves?
Alile: To some extent, our leaders brought us up in a pretentious society. Some of us were gaining favours from the British and the USA at the expense of the entire population. From the 1970s to the 80s, the hydrocarbon – which is the petroleum oil and gas, became our sign post. It was the sign post that we surrounded with and got our wealth. Unfortunately, the oil and gas industry was in the hands of the international oil companies – Shell, Agip, etc. What they were producing from those days was jointly managed between them and our political leaders with the populace not knowing what was going on.
When I got to the stock exchange, one of the things I tried to do was to see that the likes of those Nigerian companies that were not listed on the stock market should get listed. We created what we called second category market with less stringent conditions for these companies. For the last few years that I spent in the stock exchange, out of 37 the companies that came to the second category market, 8 of Nigerian companies graduated to the first market. For the last 10 to 15 years I spent in the stock exchange, our organisation was invited by the government to send pre-budget proposals, and every year for about 15 to 20 years, we were sending proposals to government to get these oil companies listed in the market.
Jimi: So there can be a bit of a commonwealth?
Alile: So that Nigerians can have shares in some of these companies and again these companies will be managed in such a way that will be more transparent. Also, Nigerians will be there in terms of managing these companies.
Jimi: Going back to the period of the stock exchange during the time of the indigenization, there was a time all the chief executives were Nigerians and because of perceived fraudulent activities, the multinationals were expatriates. How can we explain these happenings?
Alile: Most of these things were hidden from us as we were predominantly an agricultural society. A lot of the international companies working for their governments and for themselves got us to act and pretend as if we were industrialized but up till date, we are not yet there. It is only a few of us who ventured into banking that became successful entrepreneurs and a lot of us got corrupt as time went by. Sam Asabia who was the first Nigerian C.E.O of the First Bank worked closely with Obasanjo and he was my Chairman in the then Lagos Stock Exchange. We managed to bring some of the banks on to the stock market and we classified them during the indigenization exercise as second category, where Nigerians will own 60%. Sam Asabia got Obasanjo to agree to amend the decree at that time, to put commercial banks into the second category, where Nigerians will own 60%. I had to go to Obasanjo again, to approve that Nigerians can now become chief executives of those banks which they became. But over a period a lot of very bad things happened.
When Sam Asabia retired as the Managing Director of First Bank, there were people like Yusuf Sanusi, who eventually became the Governor of the CBN, whom I worked with and I know the kind of battle we had to fight with these fraudulent people who were willing to bribe with us money, they will throw it on my table, and I almost jumped over it to kick it.
Jimi: Do you think your country Nigeria has been kind to you in recognising the sacrifices you have made by not compromising; do you feel any sense of gratitude?
Alile: I feel a sense of gratitude to God Almighty who brought me into the scene because people like Sam Asabia, Yusuf Sanusi, etc, who felt that this country belongs to us and we must do as much as possible to turn it around.
Jimi: How do you think this bribery act happened?
Alile: When I left the stock exchange, I was elected into the board of the CBN, where Sanusi Lamido was the Governor. There was a case of a Nigerian owned bank, a subsidiary of a French company that defaulted, it was based on the default, that we had to set up an e-system that can take record of banks, and this very bank kept bringing its quarterly report to us. After a year we found out that what this bank had been sending for the last 10years was all fake. We began investigations and a comprehensive one at that, and we found out that that the people who were running the bank ran away with about 14billion naira at that time but we could not withdraw the banking licence because of some things. We reported the case to President Obasanjo who told the EFCC to investigate them. After the investigation by the EFCC, instead of the initial 14bnaira, they found out it was 17 billion naira that was pilfered. We took two trucks to the bank to carry almost 7bnaira, in which one of the owners of the bank used in running his election. As Governor in one of the states in Nigeria, I thought the bank will be fully investigated, but it was not, even though their licence was given back to them.
Jimi: What can Nigeria do to stop corruption?
Alile: It is going to be tough to stop corruption. It is good to see that Buhari is the President at this time. Fighting corruption is going to be tough in the sense that a lot of young men today are equally corrupt. We have to go back to our educational system, because a lot of graduates today that claim to have first class who can’t even spell their names. When the military was in power, they thought the best thing was to take the secondary and the primary schools from the missionaries. In those days when missionaries were in charge of the educational system, the moral standard was high, but unfortunately, the military thought they could legislate morals. They failed woefully, thereby crushing our educational system. Until our educational system is cleaned up, we will still be having half baked graduates.
Jimi: I think more than that, because looking at the issue of the French affiliated bank, where somebody took money to run election etc. These same people who were involved in this fraudulent act are still in the corridors of power and we are not applying any sanction. I will like to ask you sir, because you were very much around when Buhari was the head of state, if Buhari’s Government had lasted for 6 to 7years, will Nigeria be a different place entirely?
Alile: There are so many people around Buhari, I hope they are no more there, because they are corrupt. I hope there will be sufficient number of people who will still be on his side.
Jimi: Somebody asked if the indigenization exercise was a mistake.
Alile: At the time when indigenization took place, it was not a mistake, because we had no alternative and everybody was satisfied with the categories of companies and they should be owned by Nigerians. The Asians, British, and the Americans who owned those companies were asked to sell 100% to Nigerians. I and others were on the enterprise and promotion board where I was also at the stock exchange. We took a lot of decisions of which company was to fall into which category, but a lot of the foreign investors were doing everything possible to persuade us and sometimes they will bring money for bribery, for us to categorise their companies either in category 3, wherein they can own 60% or category 2, wherein Nigerians can own 60%. Some of the board members stuck to their positions, but yielded to the foreigners, the indigenization exercise at that time, awoke Nigerian entrepreneurs. For the little experience of interfacing with entrepreneurs, I started up in Rutgers Graduate School of Management, as at the time when Martin Luther King was assassinated, a lot of black Americans took to the streets and destroyed a lot of small to medium sized businesses that belonged to the Jews, Spaniards etc. The State Government of New Jersey that owned Rutgers Business School asked the school to get Black Americans to take over all the companies in New Jersey. I was chosen as an assistant director, to assist in the situation. We did it in such a way that it was successful, and Richard Nixon, the then President of America made a national broadcast recognising Rutgers Graduate School for Management. It was then that the Centre for Management Development, where Chris Ogunbanjo was the Chairman and Odiah Solomon was the Chief Executive, sent me a message, after hearing of my success in New Jersey, to come and occupy the post of the acting Head of the Department of Consultancy, through which I could help Nigerian entrepreneurs succeed in their businesses, where I found out that almost everybody in Nigeria were entrepreneurs, and they needed to be guided.
Jimi: Remembering way back when Buhari was the Military Head of State after Shagari, at that time the World Bank and the IMF were putting pressure on Nigeria to take some IMF loan with the conditionalities etc, almost faced with that scenario now, but in a more dignified way. Do you think Nigeria should take the IMF package?
Alile: At the time of Buhari’s military regime, we were getting out of the enterprise promotion decree, which gave us the opportunity of the command of our economy. But then the IMF and the World Bank came in with some financial enticement, but people did not really understand what it was all about. We took some understanding with them, but did not get soaked into it.
Jimi: Babangida carried out some of the conditionalities, but didn’t call it IMF conditionalities; he structured and called it SAP. Should we be wary of the IMF conditionalities?
Alile: Nigerians should also be in some top positions in the IMF and the world Bank so that their decisions will be influenced by Nigerians, because the world Bank and the IMF are international groups.
Jimi: Talking about the stock exchange, it had a meltdown.
Alile: In 2008, our investment policies and laws was setup such that we could not invest abroad. We in the stock market didn’t like it and it was reported to the government. There was a time when IBB used MKO Abiola as one of his workers to help negotiate the collapse of apartheid in South Africa. As at the time when MKO Abiola was the President of the Stock Exchange, we travelled to south Africa together to talk to Frederick De Klerk, the President as at that time and thereafter we went to talk to Mandela. From the little experience I had from students politics I was able to brief Abiola that there are two sectors in the set up in South Africa which are political and economic where the economic was completely taken over by the whites and we were to go and talk to the whites to give the political platform to Mandela, after he left detention. They agreed that they will continue to dominate the economic side, that when Mandela gets to the parliament, they can pass laws that can bring the economic platform back to the blacks, but unfortunately it didn’t happen. The blacks are in charge of the politics, but are not in charge of the economics. That is what Nigeria is about to inherit, up till date, there are so many big companies in Nigeria that are still run from outside the country, Companies like Unilever. I was chairman at that time after I left the stock exchange; Unilever is run primarily from England. On getting to Unilever, I found out that there was only one Nigerian executive director in the company, the rest were foreigners, so I managed to increase the quota to three Nigerian executives. Another company that was run from outside the country was Shell.
Jimi: Is it foreign domination of these companies that is causing the meltdown?
Alile: Immediately when the stock exchange got permission from IBB that Nigerians can invest freely abroad and foreigners can come with their portfolio into Nigeria, a lot of speculators moved their money to Nigeria. What we did was to make sure that any foreign investor that came into Nigeria will have to put their money in a bank in Nigeria that will help them convert their money into naira at the official rate and they will give the money to their stock brokers to buy shares for them on the stock market.
When those stock brokers came to us, we asked them to confirm from their clients that is the foreign investors on the length of time that their money was going to stay in the market so as to avoid speculating on it. A lot of foreign investors brought in about $1bn into the stock market, immediately they heard that the stock exchange was interpreting laws, they started speculating. Meanwhile their $1bn has jumped in value to about $3bn; they quickly sold their shares and left Nigeria, creating a black hole in the market. As at the time of my retirement, I went to the stock exchange office, and told them that Nigeria did not have good laws, wherein a company with surplus money can buy back some of its shares.
Jimi: Is there any kind of conspiracy with those who succeeded you?
Alile: A lot of them were people I interfaced with, and I believed they accepted my thinking.
Jimi: Do you see the stock exchange as being stable now?
Alile: No, because a full cycle has gotten on, and is back to the hole again, a lot of foreign speculators sold their shares and ran away with the money again.
Jimi: Could be tied to the economy?
Alile: When indigenization started, that was when privatisation started in the UK, and Mrs Margaret Thatcher was the Prime Minister. She set up the laws and everything. It was from the British privatisation that we copied to do our own privatisation. When they privatised British petroleum, about 25% of British petroleum was sold. But when Mrs Thatcher came back she was told that privatisation of the British petroleum had taken place, she found out that 25% of the shares were sold to a foreign government, she told them to bring back the shares. On that basis, I was able to talk to my colleagues, that the people that thought us privatisation rejected 25% of shares that was sold to them, because they wanted some elements of control.
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