Simon Kolawole Live!: Email: email@example.com
There is this fascinating story about an Abuja traffic warden. A motorist had failed to obey traffic lights. The warden stopped him, hopped into the car and told him he was under arrest. But he noticed that the motorist continued driving without a care in the world. The warden became uneasy, wondering if he had arrested a “big man”. Abuja is full of “big men” – senators, reps, ministers, SAs, SSAs and PAs. Law enforcement agents are always careful not to arrest a “big man”. The consequences are never pleasant.
“Why are you not talking?” the warden asked the motorist, who still did not utter a word. The warden asked again: “Please, are you somebody? Tell me if you are somebody!” The motorist kept his cool and drove on. As soon as the car slowed down at another intersection as the traffic lights went red, the warden jumped out of the car, saying rather remorsefully: “You must be somebody! That is why you are not saying anything! You must be somebody!” He practically ran back to his duty post.
The rules and regulations in Nigeria are not meant to be obeyed if you are “somebody”. It is a country where the “big men” do not want to pay a little toll of N100 at the airport, claiming to be “somebody”, while the rest of us have no option but to pay. The “big men” hardly want to pay personal income tax (and you can bet they pay the possible minimum), while the poor workers have their taxes deducted at source. The “big men” park at “no parking” points at the airport, with their police escorts keeping watch and causing heavy traffic for everyone else.
Nigeria is a country where “somebody” is king at the expense of others. Take banking, for instance. If you are “somebody”, you can afford to owe banks billions of naira and refuse to pay. The poor fellow owing N1 million will be harassed, arrested and detained. The “somebody” owing billions and has blatantly refused to honour his obligations will be having fun. The private jets and mighty mansions, some already advanced as collateral, will remain at his beck and call. In civilised countries, if you cannot honour your obligations, you are declared bankrupt. You will lose your collateral. You will be blacklisted from taking more loans. It is simple logic. You cannot be bankrupt and still be living like a king.
In Nigeria, you owe a bank. You own all kinds of luxury toys. You fail to meet the repayment terms. Your collateral remains intact. You continue your life of exuberance. The Asset Management Company of Nigeria (AMCON) pays off your loan to save the banks. AMCON then asks you to start paying your debt at a heavy discount. You head to court to stop it from recovering the debt. Before we know what is happening, you have been given a national honour. Member of the Niger or Member of the Benue, whatever. And while we are still trying to understand what is happening, you are taking another loan. Now, how can any country progress that way?
I know that in our country, notorious owing is not a crime (unlike in Dubai, where you could be jailed for failing to pay your debt). Debt is part of business, sure. You take debt to finance business. That is how the economy works. But the economy can stop working when you stop paying. Failure to pay up actually reduces the amount of credit available to others. It places a restriction on the capacity of banks to give out loans to grow other businesses and stimulate economic activities.
Furthermore, failure to repay puts depositors’ funds at risk. Some have lost their life savings and their lives as well because of the activities of these fat cats who like to call themselves entrepreneurs but who are mainly influence-peddlers and rent-seekers. In addition, bad debts can lead to bank failure, which could create a systemic problem and bring down other banks and other sectors. Those who argue that borrowing is a simple private transaction between the customer and the bank are probably unaware of what irresponsible lending/borrowing has done to the economy. It can affect everybody, including the cleaner in my village.
The Central Bank of Nigeria (CBN) recently published the list of chronic debtors. The list is a register of who-is-who in the economy. We are talking about those who observe their siesta in the corridors of power, including some state governments. I would have been surprised if the CBN governor, Malam Sanusi Lamido Sanusi, was not bludgeoned over this list. You don’t mess with powerful people in Nigeria and get away with it.
I understand the blacklist is meant to warn banks on their lending. There are predator borrowers who move from bank to bank using the same collateral. It only makes sense for the regulators to step in and stem the slide. Nigerians should not forget that AMCON spent tax payers’ money to buy the bad debts running into trillions. We should not forget that millions of shareholders lost their life investments in many banks that were liquidated because of the erosion of their capital base by toxic assets. We should not forget that what has happened before can happen again.
Ironically, as soon as the CBN naming-and-shaming list was published, some of the debtors started paying up. These were the same people who were behaving as if they were above rules and regulations because they are “somebody”. The banks must stop giving out loans without securing them. Debtors who don’t want to be named and shamed must be willing to honour their obligations as well. The judiciary must also stop granting ridiculous injunctions to debtors who are seeking technical grounds to delay repayment. And, of course, the CBN and AMCON must take themselves more seriously and stop amending the list of debtors as if they don’t know what they are doing.
And Four Other Things...
52 YEARS OF NOTHING?
As Nigeria marks its 52nd independence anniversary tomorrow, I want to make a prediction. The cynics will say we have nothing to celebrate, that Nigeria is a failure, that it is all gloom and doom. Let me be fair, though: everyone is entitled to an opinion. My own opinion is that we are not where we should be. We should be competing with Korea and Brazil by now, but we are still struggling. But I will not go the extent that Nigeria is a failure. No. The evidence before me suggests that greatness is ahead of us and only a reckless gambler will write Nigeria off. There is still a tomorrow, I believe.
The Senate has asked the Federal Government to appeal for a review of the International Court of Justice judgment on Bakassi, which forced us to hand over the peninsula to Cameroon. We had lost the case in October 2002 but we can still ask for a review by October 10, 2012. Given that the ICJ relied on the map supplied by the Nigerian authorities to effectively cede the peninsula to Cameroon, what new evidence are we taking to the court? Or do we just want to ridicule ourselves the same way our politicians keeping asking the Supreme Court to reverse itself?
FLOOD FROM HELL
If not that the Bible says the earth will not be destroyed by flood again, I would have been worried that the world is about to come to an end with the growing cases of flooding. In the last few weeks, flood has done extensive havoc in Nigeria, from the North to the South. Places that should normally be free of flood are soaked and floating. I’m at a loss over this. I get a feeling some circumstances are not beyond human control, just that the government did not act on time to relocate people despite all the warnings that preceded the disaster.
OLYMPIC GOLD FOR GRAFT
When I recently wrote on the endemic nature of corruption in Nigeria, I did not realise I was embarking on a journey I couldn’t finish. Many readers have expressed disappointment that I did not offer any suggestions on the way forward. A particularly angry respondent wondered if I was just the typical critic, highlighting the problem and ignoring the solution. I’ll be honest: I have little or no ideas on how we can fight the monster to the finish. But I still think it’s a multidimensional problem that requires a multidimensional approach. We have a very long way to go!