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Nigeria's Incompetent Economic Team

06 Mar 2013

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 By Odilim Enwegbara  odilim.enwegbara@thisdaylive.com

A lack of commonsense is causing the economic team poor performance


Inheriting a completely rundown economy on December 18, 1978 Deng Xiaoping refused to allow the status quo to remain. Taking his beloved China on a tempestuous transformation voyage with all unimaginable risks in the world, he rolled out some unheard-of draconian economic development measures, including not just downsizing and squeezing out more money out of bloated government. China's byzantine bureaucracy also was forced to become efficient. Done, fully aware of the potential ambush to be expected from the west, Deng Xiaoping outsmart the enemy when he took the unfamiliar route in turning China into what it eventually became three decades later.


Learning President Franklin Roosevelt's tricks of surrounding himself with America's most practical and patriotic men and women in 1933 — including hiring men like Henry Morgenthau as secretary of treasure (even without an economics degree), and men like Marriner Eccles as Federal Reserve Chairman (even without a university education) — Deng's surrounding himself with China's fiercest selfless patriots, commonsense men and women, made him to tell them, ''It doesn’t matter whether a cat is black or white as long as it catches mice.''
Little wonder, just after three decades of phenomenal economic revolution, the result couldn't be more striking — that China could emerge from a provincial economy to an economy which became the envy of the whole world. Not only into the world's stage as another newcomer, but as the world’s manufacturing workshop, holder of its largest foreign reserves (more than $3.7 trillion), and above all, second only to the US in GDP. 


Like China before Deng's economic revolution, Nigeria today tops the world’s corruption, unemployment, and rundown economic charts. Also like China before its economic revolution, Nigeria today is littered with graveyards of innumerable policy somersaults, with completely disenfranchised people. But unlike Deng, Nigeria's Jonathan is yet to aggressively pursue the inevitable life-and-death lean government. And unlike Deng and Roosevelt, President Jonathan still makes do with men and women who specialized in western economic theories with little commonsense to accompany them. 


Unlike Deng and Roosevelt, whose first 100 days in office witnessed dramatic economic changes, Jonathan's 1000 days in office is still trapped in big government, with little or nothing done to retrieve public money badly needed in addressing the country's infrastructure deficit. In fact, after more than 18 months, little other than grammar is what President's economic team has been speaking. Some still so believed in their celebrity status that they're not ready to risk it for anything else. Some believed that intimidating academic and professional resumes, even though with nothing to show for them, are what appeal to an average Nigerian.

That they see no urgency to bring down the current big government which gulps over 70 per cent of the country's annual budget shows no urgency to find the money needed for addressing Nigeria's growing infrastructure deficits. Reducing our bloated government, even though is far from a rocket science, is yet to be given the seriousness it requires including hiring respected personnel auditing firms for conducting some full-scale forensic personnel and competence auditing of all the ministries, departments, and agencies. Besides flushing out hundreds of thousands of ghost and unqualified workers, freeing trapped public funds, shouldn’t be expected without conducting personnel auditing, not to mention bringing badly needed efficiency into the country's byzantine public service.

Without efforts to retrieve the huge public money trapped in our big government, how could government be able to find the money to push for the aggressive development of the country's critical infrastructure that continues to hold down the full takeoff of the economy? Or should our economy become modern and industrial without government disproportionately investing in critical social infrastructure?

That's why getting to the bottom of how best to free trapped public money, should require full implementation of the Monetization Policy started by Obasanjo administration, but prematurely terminated by Yar'Adua administration. Not only because pursuing this policy has become inevitable should we want to reduce our current high level of corruption and mismanagement of public funds. Forcing public officeholders to live within their means is long overdue especially if we want to stop the absolute opulent lifestyle our public servants today display. But that the economic team has not considered these measures urgent is a demonstration of how unserious they are with the reduction of our big government.

But it is possible to expect the implementation of these measures without these economic theorists replaced with more practical and more result-oriented men and women? For a government preoccupied with having only men and women with intimidating western academic qualifications, it boils down to believing that western economic eggheads are synonymous with economic success, when in reality the reverse seems to be the case. In other words, we've not taken advantage of our hugely talented men and women because most of these men and women never accumulated these outdated qualifications, which their holders lack originality in thoughts.  


Imagine what the world would have looked like had it been solely left in the hands of economists! Would Emperor Meiji of Japan have succeeded, using his commonsense economic illiterates in 1868 to turn Japan into a modern industrial economy? Certainly, the presence of Britain's gifted economists like John Maynard Keynes wouldn't have allowed America to take over from Britain in 1945 the economic superpower status. Of course, it would have amounted to an impossibility expecting Deng to have used his economic illiterates to outsmart westerners in their own game.


If it is all about fielding highly qualified economists, one should have by now been perplexed that with the presence of these economists, our nation is still deep in crisis; our economy is still fully import dependent, without foreseeable chances of being transformed, let alone being positioned as one of the global industrial powerhouses. But that is not how economic development works. At least, history has taught us that in fact too much economics — like an overdose — kills economic development rather than grows it 
It is not surprising how deeply trapped we have become believing sheepishly in western neoclassical economic theories, especially to the extent that we are still a member of the World Trade Organization, notwithstanding its destructive effective on our economy. Isn't it not too much faith in western economics that has made us to be sheepishly following the World Bank and IMF economic policies, even though their destructive consequences are everywhere for everyone to see?


If it is not excess neoclassical economics, what else would have been the plausible explanation for the current invasion of our economy by some foreign exporters whose strategy seems not to bother our economic team, while the naira is kept artificially overvalued to keep our insatiable consumption of foreign goods uncontrolled? And for the same simple reason we export millions of jobs while our teeming youth roam about in search of the nonexistent jobs. That our economic team is not alarmed that we are spending our scarce national resources on consumption of imported goods is unbelievably worrisome, just to say the least.


Haven't we reached such economic sophistication to begin to recognize qualifications as not the only tool for measuring performance in public service? Should self-celebration and award craze supposedly for politicians become extended to our technocrats, especially when the 2013 budget confusion is yet to be over? Isn't it inconceivable that while this economic ship is tossed around, the captains seem more preoccupied with collecting cheap awards? Or should it be unheard-of for the technocrats to quietly do the job they're hired to do?
That after 18 months, the economic team is yet to come up with a comprehensive industrialization roadmap, mandating states to dot themselves with industrial parks with the full support of the federal government, shows how much these folks truly understand economics beyond the textbook theory. That foreigners are still running our economy while our entrepreneurs, small business owners, and supposed big time business enterprises are reduced to onlookers, is such a sad story for the country. Spectators while: oil giants from America, Britain, France, and Netherlands; construction giants from Germany, Italy France, and Lebanon; retail giants from India, China, Lebanon, and South Africa run the show.


In the meantime, it is mind-boggling that the economic team is yet to consider it urgent to protect our infant industries by sealing off our borders and by making sure they are jointly manned by the customs service, immigrations, military, police, and SSS. Or shouldn't they recognize economic sabotage the same as terrorism?


How come after 18 months we are still spending trillions of naira each year on bloated fuel subsidies, when a fraction of that money would have been enough to build refineries? Or how much time do they need before recognizing this as top economic priority?
Since we all agree that it is excessive reliance on theories and less on commonsense that has kept us continuously underdeveloped, isn't it time to assemble the right men and women with commonsense to find the right route to our economic destination? If people like Chike-Obi have done exceptionally well in reviving the country's comatose banking industry, why shouldn't we hand them the economy to transform? But about having more practical economists like Pat Utomi lead the economic team? 


No doubt, there's something to celebrate; at least it is worth celebrating the ongoing efforts to make PDP internally democratic. That this government is fast dismantling the omnipotent Governors' Forum as well as forcing Obasanjo and his boys to now discover that the era of one man calling the shot is over.   


Let me end by reminding you the reader that if you agree with Prophet Mohammed that ''the ink of the scholar is more sacred than the blood of the martyr,'' then, please understand the immense difficulty I encounter each time I try to share my thoughts with millions of Nigerians, especially in trying to follow dictates of my conscience and my deep love for Nigeria. 

  
Enwegbara is a MIT educated specialist in money and financial matters. He can be reach at 07038501486

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