Reflections on Our Nation’s Sliding Economy

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RingTrue

with Yemi Adebowale; yemi.adebowale@thisdaylive.com; 07013940521 (text only)

I am glad that my months of campaigning for flexible forex exchange rate and deregulation of the downstream sector of the oil industry has finally yielded result. In just a few weeks after, our economy is already reacting positively to the implementation of these policies by our extremely archaic federal government. The appreciation of the Naira in the parallel market is a reflection of the impact of the flexible exchange rate. The new forex policy has the potential of frustrating the activities of currency hoarders and speculators. Because of partial deregulation, queues have disappeared from our fuel stations.

The shops of those milking this country dry with dubious subsidy claims have been shut. Full deregulation will also attract private investors to this sector. In the long run, the prices of petroleum products will fall. Those wicked people, who called me names because of my position on these issues, obviously don’t want this country to progress. They are the ones benefiting from the warped economic policies of the Buhari administration.
Let’s go straight to the issue of the day. It is pertinent to draw attention to some pragmatic steps this government can take to pull our depressed economy from the brink. Perhaps, our president will read this. In the last 13 months, our economy has been experiencing what economists call “stagflation.” This is a situation where inflation, persistent negative growth in Gross Domestic Product (GDP) and rising unemployment are occurring at the same time. Volatility in the global oil market and lack of clear-cut government policies for stemming excessive imports have contributed to this crisis. A technical economic recession is imminent. If we are not careful, we will go into depression.

It is only the real sector –manufacturing and agriculture – that can get us out of this crisis. This can only happen if this administration creates an enabling environment for them. What the Buhari administration has been doing in the last 13 months is unacceptable. Its policies have been stifling. The sector has the capacity to employ millions of youths with the right policies and enabling business environment from the federal government. Just as an economist, Mr. Henry Boyo, said: “The manufacturing sector should be the galvanising agent for investment expansion, economic diversification and employment of labour in Nigeria, but unfortunately, the sector has not been able to satisfactorily perform these roles because of misguided government policies. Government is expected to provide the enabling environment for such positive participation of the sector.”

Right now, the real sector is in crisis, with government’s confused policy direction, multiple taxation, harassment of manufacturers by government officials, insecurity, decaying infrastructure, power crisis, high cost of borrowing, fall in consumer purchasing power and a whole lot of issues. As a result of this stifling operating environment, industrial capacity utilization has fallen to about 10%. This is why so many Nigerians are being laid off. Government needs to reconsider the 41 items it banned from accessing forex at the interbank spot market. Some critical raw materials are on this list.

This government has to swiftly reflate the economy by spending massively on infrastructure. Our MDAs should be allowed to judiciously spend the huge amount locked up in the Treasury Single Account (TSA) on critical things. The money in the TSA is rising while the economy suffers. This policy that was adopted ostensibly to ensure transparency and avoid misapplication of public funds, now constitutes a clog in the wheel of progress of this country.
Manufacturers are spending fortunes powering their factories with generators. The last 11 months have been harrowing. This idea of blaming the crisis in the Niger Delta for epileptic power supply has to stop. Enough of excuses. Generating companies must be challenged to source their gas needs from any part of the world. Thermal stations exist in countries where gas is not produced.
Now, the biggest drain on our forex remains imported petroleum products. Just as some experts stated recently, “We cannot continue as a country that produces oil without capacity to refine it. When we produce oil and export all as it is the case currently, it is creating value in somebody’s economy.”
Existing refineries should be sold to investors with the right technical knowhow to run them. We also have to urgently raise our domestic refining capacity through the modular approach. Investors should be encouraged to build refineries in modular form, near existing ones. This country has the potential to become a hub for the refining of petroleum products in Africa. This is how we can create jobs for our people.

On his part, President Muhammadu Buhari must start spending quality time with the Manufacturers Association of Nigeria (MAN), National Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and with other stakeholders in the real sector. The idea of spending virtually all his time and resources on running after looters must come to an end. Loot recovery cannot create jobs for our youths or reflate our economy. This is why our president must concentrate on economic recovery and allow the Economic and Financial Crimes Commission (EFCC) and other anti-graft agencies to do their jobs. Again, this country cannot afford a confrontation with the Niger Delta Avengers (NDA), else, it will compound our economic woes. Everything should be done to sustain the peace accord with the NDA in the interest of our economy.

Buhari must also lead in cutting the cost of governance. I still can’t fathom why the president is operating with four media aides and a retinue of other special advisers/special assistants, amidst economic crunch. I can’t understand why the president is maintaining 10 aircraft in the Presidential Fleet when he is talking about cutting cost. I can’t understand why the State House Clinic and National Hospital in Abuja can’t handle the healthcare of our president to save the forex spent on treatment abroad.  Buhari has to reduce his foreign trips to save our forex. The Archbishop Emeritus of Catholic Archdiocese of Lagos, Anthony Cardinal Olubunmi Okojie aptly captured all these when he recently advised Buhari to restart his leadership of the country by returning to his inaugural speech as well as the ruling All Progressives Congress’s Manifesto.
Okogie declared: “If President Buhari wants to make a quick turn back, he should take his inaugural speech and the All Progressive Congress manifesto, study them and then start afresh.”

Rauf Aregbesola’s Jaded School Feeding Programme
After almost six years of his administration, the Governor Rauf Aregbesola’s school feeding programme in Osun State is yet to take off in middle, junior and secondary schools in the state. I can say it with all authority that all the noise being made on this programme is just a political gimmick. In Aregbesola’s so-called Elementary School 1-4, where the ill-conceived feeding programme is taking place, many head teachers confirmed the charade. The quantity of food given to these hapless pupils can barely satisfy a small bird. Besides, the quality of food served is abysmally low. My contacts went round some elementary schools in Osogbo to observe the programme and discovered that it was a travesty. The schools visited were Methodist, Benedict and St. Francis Elementary School, Isale-Aaro; Anthony Udofia Elementary School; L.A. Gbeja and St. Andrews Elementary School, Oke-Bale; Rasidi Igbalaye Elementary School; Baptist Elementary School, Oke-Okanla; A.U.D Elementary School; L.A Elementary School, Gbonmi; Union Baptist Elementary School,  Odi-Olowo; Community Elementary School, Owode- Garage Ilesha and Gidado Elementary School, Ijetu.
In some schools, pupils were served as low as two slice of bread with jaded stew. When rice is served, pupils hardly get up to two table spoons with funny-looking stew. Some head teachers told me that they could not complain for fear of being sacked. Besides, virtually all the food contractors are said to be Aregbesola’s cronies, which makes it difficult for them to be checked.
Again, governor Osun should reverse these illegally-introduced elementary and middle schools in the state. This is creating confusion. Teachers in Osun are sickened by this policy. What the laws of this country recognise is 6-3-3-4 system of education. Aregbesola has added unwieldy elementary and middle schools across the state. In the process, schools were recklessly merged and demerged. Teachers who are being owed nine months’ salaries are being forced to implement this unenthusiastic policy. One of the most painful actions in this direction was the demolition of Fakunle Comprehensive High School, along Aregbesola’s office and the callous acquisition of the land for a proposed shopping complex. This co-educational school was merged with an all-girls school – Baptist Girls High School – thus creating crisis.
Again, I am still waiting for Aregbesola to obey the recent ruling of the Chief Judge of the state, Justice Oyebola Ojo on the issue of Osun’s worn-out finance. The judgegranted an order of mandamus compelling the governor to provide necessary information in respect of the state’s debt profile and its defrayment modality. The order came on the heels of an application by a lawyer, Kanmi Ajibola. Ajibola also sought an order to compel Aregbesola to provide information about the financial cost of all the capital projects executed so far by his government; and an order directing the governor to tender evidence of the lodgement into civil servants’ retirement savings accounts. The judge granted all the reliefs sought by Ajibola. So, I am waiting for Aregbesola to respond appropriately.

Is the Federal Character Commission Dead?
I spent most of yesterday looking through the Federal Character section of the 1999 constitution in relation to appointments so far made by President Muhammadu Buhari. Indeed, Section 8 of the third schedule sets up the Federal Character Commission and it provides as follows: “In giving effect to the provisions of Section 14(3) and (4) of this constitution, the commission shall have the power to work out an equitable formula subject to the approval of the National Assembly for the distribution of all cadres of posts in the public service of the federation and of the states, the armed forces of the federation, the Nigeria Police Force and other government security agencies, government owned companies and parastatals of the states.”
The FCC has clearly not been effective as seen from Buhari’s appointments; the most frightening being the lopsided appointments in military and para-military departments and agencies. They are the Acting Inspector General of Police, IGP, Ibrahim Idris; Comptroller-General of the Nigeria Customs Service (NCS), Hameed Ali; Commandant of the Nigeria Security and Civil Defence, Abdullahi Mohammed; Controller General of the Federal Fire Service, Joseph Anebi Garba; Chairman/Chief Executive Officer NDLEA, Mustapha Abdallah,Comptroller-General of the Nigeria Immigration Service (NIS), Mohammed Babandede; Controller-General of the Nigeria Prisons Service (NPS), Ahmed Ja’afaru; Chief of Army Staff, General Tukur Buratai; Chief of Air Staff, Air Vice Marshall Sadique Abubakar; Chief of Defence Intelligence, Air Vice Marshall Monday Morgan; National Security Adviser, Babagana Monguno and Director-General of the Department of State Services, Lawal Daura.
These key positions are headed by people mainly from a section of the country. This is clearly against the federal character principle. I hope our president is listening. May Allah grant him the wisdom to be fair to all sections of this country.

A Word for Lagos Police Commissioner
The response of the Lagos State Commissioner of Police, Mr. Fatai Owoseni and his men to the recent brutal attacks on innocent Nigerians by militants in some boundary communities between Lagos and Ogun states was appalling. Communities affected were Igbo Olomu, Oke Muti, Elepete, Ajegunle, Ola Imam, Ereko junction, Pakisa and Magbon. The police only responded after several days of killings in these places. According to some landlords in the affected areas, over 50 people were killed. It is even more painful that several days after the attacks, the Lagos Police Command is yet to apprehend even one of the attackers. My dear Owoseni, I find it repulsive that you said “anywhere in the world, the military and police hardly operate in the night.” I thought you were misquoted. I waited for you for several days to debunk this but it did not happen. Policing is done round the clock in standard societies. Ours should not be an exception. The brutalised residents of Ikorodu expect to see your patrol teams working round the clock.