I have heard and I have read, many people say that the government of
President Muhammadu Buhari does not have an economic direction. That this
is the reason why things are getting bad in the country. My submission is
that people who share this opinion have either refused to tell themselves
the truth or they live elsewhere outside this world. However, I have
decided to pen this piece to let them know that not only does the Buhari
government have an economic direction, it is also one that looks very
promising.
In the last few months, particularly since President Buhari took over the
mantle of leadership, things have really taken a nose dive. The hunger in
the land is increasing, the unemployment rate is worsening and the poor
are getting poorer. Was this unexpected? The answer is a clear no. What we
are witnessing today is not a factor of a Buhari government. I posit that
Nigeria would still have been witnessing the same thing or even worse if
Jonathan were to be the president today and I will tell you why.
Except for the first quarter of 2015 when the price of crude under the
Jonathan regime sold for $58.7 per barrel on the average, Nigeria’s crude
sold for as high as $150. In 2011, 2012, 2013 and 2014, Nigeria’s crude
was sold for a yearly average of $113.8, $113.5 $111.0 and $100.4 per
barrels respectively. Within the same period, our foreign reserves rose
and fell from $32,639.8bn $43,830.4bn $42,847.3bn and $34,250bn
respectively, before it finally crashed to $29,595.28bn in the first
quarter of2 015, while the country’s GDP rose from $409.34bn in 2011 to
$561.61bn in 2014. (Source: RTC Advisory Services Ltd, Nigeria Retrospect
– Economy and Policy, 1999-2015).
Looking at the above figures, the believe was that Nigeria’s economy was
on a good footing, but this is not exactly so. Why the growth figures are
good, the successes recorded are largely uncoordinated, especially because
the structure and quality of growth were not considered. This is why the
UNDP Human Development Report, 1996 stated that “unless governments take
timely corrective action, economic growth can become lopsided and flawed.
Determined efforts are needed to avoid growth that is jobless, ruthless,
voiceless, rootless and futureless.” Take unemployment for example,
despite the huge revenue from oil between 2011 and 2014, the unemployment
rate never really dropped. In 2013, its was 24.7% and in 2014, it stood at
24.3%. Even in 2012 when the yearly average of oil earning was $113,
unemployment rate stood at 27.4%.
The question then is why are most Nigerians poor despite rising revenues
and GDP growth? The answers are not far-fetched. Firstly, oil which is
Nigeria’s main revenue does not by itself, create many jobs. Jobs created
from oil are only a few compared to the revenue it generates. Secondly, is
the issue of corruption and lack of transparency that was pervasive in the
last government. Over the last four years, there have been several
alarming and scandalous cases of corruption in Nigeria. From the $6bn Fuel
Subsidy Scam to the missing $20billion NNPC scam and the 300,000-400,000
barrels of oil per day that was stolen from the country amongst many
others. And juxtaposing this with the fact the infrastructural problem of
the country especially in areas of roads and transportation; power;
Information technology continue to suffer neglect despite huge revenue, it
will be a mirage to think that Nigeria can be repositioned for success.
One other thing responsible for the poor state of affairs in the country
is the fact that the poor population of 110 million Nigerians lack access
to healthcare, education and other social welfare programmes due to low
spending on these sectors by the last government.
So what is the way forward? What is the Buhari government doing
differently? Since coming into power, President Buhari has put in place
measures specifically to shore up the revenue of government because no
matter how lofty your plans are, you can only implement those plans where
there is money. This is why the president has ensured transparency in the
oil and gas sector with the appointment of Dr Ibe Kachiku as the GMD of
NNPC who in turn has taken measures to reform the sector and block
leakages in oil revenue. The president also appointed Babatunde Fowler,
the man who turned around the revenue of Lagos state to head the Federal
Inland Revenue (FIRS) and Hameed Ali into the Nigeria Custom Service
(NCS). With the reforms and re-organisation going on in these two agencies
of government, the plan is to ensure that revenue earned from both
surpasses the revenue generated from oil.
The directive that all Ministries, Departments and Agencies of the Federal
Government register for the Treasury Single Account domiciled with the
Central Bank of Nigeria is also another measure to shore up government
revenue. At least N1.4tn had so far been paid into the TSA to date, an
amount that would have been available to looters to feast on in previous
administration.
In addition, the government is also pursuing an anti-corruption agenda to
prosecute and bring to justice, those who turned the country’s resources
into their private pockets. Though, nobody has been convicted so far, but
some perpetrators have been taken to court and some amount of money
recovered. I believe details on this will be made available soon.
Away from shoring up revenue, government has also put in place measures to
invest in the people (social sector investment).To achieve this therefore,
the government has outlined an objective of stimulating and supporting the
establishment of world class skill acquisition centres in all 109
Senatorial Districts of the Federation. The government has also made a
commitment to provide one meal a day for all primary school students which
will create 1.14million jobs in agriculture, with a multiplier effect in
increased food production and attract investment.
Boosting rural economy, lifting millions out of poverty through a
conditional fund transfer to 25 million poorest households to incentivize
vaccination, education and production is also at the heart of the
government. The government is also set to diversify the economy by
investing in the areas of Agriculture, Manufacturing, Entertainment and
Technology as well as boosting education and building capacity to improve
teacher quality with the expectation of having an educated population to
increase economic potential for productivity.
All these are important because according to the IMF: “Specifically, if
the income share of the top 20 percent (the rich) increases, then GDP
growth actually declines over the medium term, suggesting that the
benefits do not trickle down. In contrast, an increase in the income share
of the bottom 20 percent (the poor) is associated with higher GDP growth.
The poor and the middle class matter the most for growth via a number of
interrelated economic, social, and political channels.”
With the efforts at shoring up revenue as I earlier outlined, the
government will have the resources to implement these programmes, the
resultant effect of which would be more jobs for Nigerians, an educated
and healthy population, a repositioned economy built on structures and
quality of growth and a population lifted out of poverty. If this is not
an economic direction, I wonder what is.
Abubakar Usman is a member of the Buhari Media Support Group. He can be
engaged on twitter @MrAbuSidiq