To mark the first anniversary of the second term of the Buhari administration recently, the federal government announced a plethora of policies, programmes and projects, which it defined as achievements of the Buhari administration. Nosa James-Igbinadolor looks at these accomplishments and wonders if the government should indeed be celebrating at all
August 21st 2020 marked the first anniversary of the second term of the Muhammadu Buhari administration; an administration largely perceived as lacklustre in ideas and results, and cruelly divorced from the distressing economic realities of average Nigerians.
Faced with a growing yet unyielding harmony of public opinion, crystalised around a tangible perception of failed promises and brittle achievements by the president and his government after five unpromising years in office, the Presidency threw at Nigerians a mélange of what it averred to be feats and triumphs.
These ‘accomplishments’, a salad of initiatives and policies, with a sprinkling of projects, according to a statement from the Presidency, include the President establishing “new Ministries, including Police Affairs and Humanitarian Affairs, Disaster Management and Social Development in 2020, the Budget Implementation Cycle being successfully restored to a January-to-December Calendar, with the signing of the 2020 Appropriation Bill in December 2019 and President Buhari signing into law a Finance Bill, to reform domestic tax laws, introduce tax incentives for investments in infrastructure and capital markets, and improve the business environment.”
The presidency also asserted that among the many achievements of the administration is that President Buhari ordered a forensic audit of the Niger Delta Development Commission (NDDC), Nigeria rising 15 places on the World Bank Doing Business Index, to 131st position, from 146th, and President Buhari assenting to the Deep Offshore (and Inland Basin Production Sharing Contract) Act.
Also mentioned were Buhari performing the ground-breaking for the University of Transportation in Daura, an investment by CCECC in Nigeria, Vice President Yemi Osinbajo performing the ground-breaking for a new Wagon Assembly Plant in Kajola, Ogun State, which will produce rolling stock for Nigeria’s new Rail Lines, and create jobs for thousands of Nigerians, President Buhari approving the Financial Transparency Policy, mandating publication of Public Financial Information through an Open Treasury Portal and Nigeria commencing the issuance of Visas on Arrival to all persons holding passports of African countries among others
It further posited that “no fewer than three private Modular Refinery projects have been completed in 2020
“The first of the dozen A-29 Super Tucano light attack, combat and reconnaissance aircraft ordered by Nigeria in a government-to-government deal with the United States successfully completed its inaugural flight at the production facility. The full fleet is scheduled for delivery in 2021.
That the “The Central Bank of Nigeria (CBN) launched a 50 billion Naira Household and SME support facility, to cushion the effect of the Coronavirus pandemic. As at July 2020, N49.195 billion has been disbursed, to over 92,000 beneficiaries,” is also part of the administration’s achievements, according to the statement.
The ‘achievements’, long on initiatives but feeble and petite on outputs and positive, impactful results, reflect the realities of the last five years of the administration; one largely characterised by a debilitating economy, unprecedented job losses, poor investor confidence, and a weak local currency among other economic ills.
The obvious fact, is that the last five years of the Buhari administration, despite the uplifting picture painted by the government have seen the economy meander from one bleak valley to another.
The depressing state of the Nigerian economy under Buhari, was aptly enumerated by the Economist magazine in its May 2019 edition, when it noted, “the Nigerian economy is stuck like a stranded truck. Average incomes have been falling for four years; the IMF thinks they will not rise for at least another six. The latest figures put unemployment at 23per cent, after growing for 15 consecutive quarters. Inflation is 11per cent. Some 94million people live on less than $1.90 a day, more than in any other country, and the number is swelling. By 2030 a quarter of very poor people will be Nigerian, predicts the World Data Lab, which counts such things”.
In 2016, Bloomberg, the financial and media giant, warned that the rigid leadership style of President Muhammadu Buhari was making Nigeria’s economic challenges difficult to solve. Africa and the world, according to the company, “cannot afford a failing economy in the continent’s most populous nation.
“Yet that is exactly what Nigeria might be getting: Its economy is on track to shrink by 1.7 per cent this year, the official unemployment rate has more than doubled over the last two years, and inflation is at an 11-year high.
“One concrete step President Muhammadu Buhari could take to address the crisis would be to eliminate the country’s disastrous foreign exchange controls. Instead, Buhari has made no secret of his desire to defend Nigeria’s currency.
“And the central bank has mostly gone along. Despite allowing the devaluation of the naira in June, it is continuing to manipulate the exchange rate — discouraging foreign investors, creating a crippling shortage of dollars for businesses that need to import, and feeding a currency black market. To keep down the street price of vanishing dollars, Buhari’s government has arrested informal money-changers. More capital controls are in the works.”
The Nigerian government only began to see reason and adopt these policies in 2019 despite warnings and admonitions by economists and other experts.
According to the latest data from the National Bureau of Statistics, NBS, Nigeria’s Gross Domestic Product (GDP) contracted by 6.10 per cent year-on-year in the second quarter of 2020. The figure represents an 8.22 percentage point decline compared to the Q2 2019 GDP growth rate of 2.12 per cent, and 7.97 percentage point drop from the 1.87 per cent growth rate recorded in Q1 2020. The -6.10 per cent negative growth effectively ends the low, but positive real growth rates recorded since the 2016/17 recession.
In addition, the oil sector contracted by 6.63 per cent in real terms in Q2 2020, representing a 13.80 percentage point decline when compared to the Q2 2019 figure, while the non- oil sector, according to the report, contracted by 6.05 per cent in Q2 2020, representing a 7.70 percentage point decline from Q2 of last year. It is also the first decline in real non-oil GDP growth rate since Q3 2017.
The International Monetary Fund (IMF) had projected in June that the Nigerian economy would witness a deeper contraction of 5.4per cent in 2020
According to the NBS, the decline was largely attributable to significantly lower levels of both domestic and international economic activity during the quarter, which resulted from nationwide shutdown efforts aimed at containing the Covid-19 pandemic.
The expectation, according to Bloomberg, is that the Nigerian economy would contract further in the third quarter of the year. “We expect the economy to contract again in Q3, but at a slower rate than Q2. The above target oil production in April-June, though, mean steeper production cuts will be required in August and September in order to reach full OPEC compliance. At the same time, a weaker naira and on-going foreign-exchange restrictions will continue to weigh on growth in the non-oil sector,” it said.
Data from the statistics body further show that the country’s unemployment rate rose to a record 27 per cent in the second quarter of 2020, from 23 per cent in the third quarter of 2018. In effect, about 22 million Nigerians, twice the population of neighbouring Benin Republic, are unemployed. The underemployment rate is much higher, with 22.9 million Nigerians working less than 20 hours a week. As expected, the majority of the unemployed are young men and women in their productive age. Since coming into office in 2015, the Buhari administration has lost more jobs than any other administration in country’s history.
The analysis by most experts is that the last five years has seen little of anything perceptible to celebrate about. In its 2019 analysis of the Nigerian economic and business landscape, the global media and investment company, Forbes warned, “Want to lose money in one of Africa’s biggest markets? Put it to work in Nigeria.
“Despite sitting on nearly 40 billion barrels of proven oil reserves and over $48 billion worth of investment opportunities in the oil and gas sector, Africa’s largest economy is mired in problems with big corporate investors as president Muhammadu Buhari readies his second-term after a swearing-in ceremony scheduled for May 29.
“Nigeria’s stock index is down 0.4per cent year-to-date while emerging markets are up 2.3per cent and the MSCI Frontier Markets 100 is up 10.2per cent.
As one of the better known, investable African equity markets, anyone who tried their luck with the Global X Nigeria (NGE) exchange-traded fund is down 27.7per cent over the last 12 months. In five years, the Nigeria ETF has blown up, now down over 74.5per cent. Frontier and emerging indexes are better than Nigeria. It’s also worse than South Africa, Africa’s largest stock market, and Egypt, Africa’s second largest.
“In terms of foreign direct investment, back in 2013 inflows totaled $5.6 billion, most of it in the telecoms and energy sectors. Last year, Nigeria’s FDI flattened to $2 billion. Equity investment between 2013 and 2018 has fallen from around $2.9 billion in 2013 to just $139 million in 2018. In the last quarter of 2018, there was the first net pull-out of equity capital since records began under the current accounting methodology in 2008, according to data compiled by The Economist Intelligence Unit (EIU).
“It’s Nigeria’s abundant commodity resources that make it so big. But it’s Nigeria’s government that keeps it from getting bigger, and richer.”
Under Buhari, Nigeria faces “a looming external debt crisis.” Its external debt increased by about $20 billion in five years, going from a little less than $10 billion to $29 billion between 2015 and 2020.
Most of these debts were recorded in the first four years of the President Muhammadu Buhari’s administration via multilateral, development, bilateral and commercial loans (Eurobonds and Diaspora bonds). To most Nigerians, there is nothing tangible on ground to justify these massive debts incurred by the administration. On the contrary, debt servicing now takes up more than 80 per cent of government revenue, leaving very little for much needed capital investments.
For the average Nigerian, the achievements and successes of any government can be better appreciated by how the policies, programmes and projects of that government affects their income and daily lives. A 50kg bag of rice cost on the average N8,000 five years ago before this administration came into office as against N28,000 under Buhari. This is despite the government’s much heralded and trumpeted ‘rice revolution’. While a litre of fuel under the preceding administration cost N87, it is today N148. A bottle of Coke cost N60 under the last administration as against N150 today, while a tin of peak milk which cost N80 under the last administration now sells for between N250 and N260 today. Flying to Lagos from Abuja was on average around N10,000 five years ago, it hovers around N27,000.
Five years after, most Nigerians would likely see the rash of successes painted by the government as preposterous. They are unable to connect with these self-adulating achievements that remain a mirage to many. Almost everyone will agree that life has become a lot difficult since Muhammadu Buhari took over power; what with tens of millions of jobs lost, the naira in constant freefall, an economy producing lots of oil and almost nothing else of worth, and a growing debt crisis that many thought Nigeria had finally dealt with in 2006 when the former President Olusegun Obasanjo administration paid off the nation’s sovereign debts
Five years is more than enough to fundamentally change the socio-economic landscape of any country, including Nigeria. The Buhari administration has woefully failed to chalk up a posse of accomplishments, rather it chose to respond to the widely held belief by Nigerians of unconscionable and immoderate failure to achieve much by wringing out of a cornucopia of disappointments, an assemblage of initiatives sans result.