By Dele Awogbeoba
The Buhari presidency is now 6 months old. It won a closely fought presidential election against the former President Jonathan and inherited a depleted public finance account, a ruthless insurgency and weak oil market. President Buhari’s performance can be examined by looking at a number of sectors.
Security
It is fair to say that the Nigerian armed forces appear to have become a more professional outfit. It is no longer losing battles with or territories to Boko Haram. The armed forces appears to be better organized and more efficient. There appears to be less stories of officer desertions these days and more stories of victories on the battle field.
On the flip side, domestic terrorism has been on the rise. Thousands of people have lost their lives to bomb blasts in the North since Buhari came to power. That is more a failure of the domestic security agencies (such as the DSS) than the armed forces. It appears that the DSS needs to spend more time infiltrating the terrorist network in order to sabotage, degrade and defeat Boko Haram from within. The DSS may need to focus its attention more on the immediate threat of Boko Haram and leave the police to deal with the potential threats emanating from Dasuki and Nnamdi Kanu.
Economy
This has also been a mixed bag. The Foreign exchange policy geared towards artificially strengthening the value of the naira has been doing great harm to the domestic economy, Nigerians foreign reserves as well as foreign investor confidence in the Nigerian economy. The misplaced policy has also been needlessly depleting foreign reserves. At the last count we were down to 30billion dollars. The TSA policy predicated on more efficient management of government finances has depleted the economy of vital liquidity. In this era of reduced government spending and the reduced liquidity within the system as a result of TSA driven policies, an economic contraction was very much on the cards. However, the CBN has started to rethink its ill advised policies in recent weeks. It has reduced interest rates to 11% (not low enough but a step in the right direction) and has reduced the requirement for banks to keep a certain level of its funds with the CBN thereby injecting vital liquidity into the economy if properly utilized by banks in providing vital finance for the real economy.
The finance minister has established a unit within her department that will oversee government spending across the board with the brief to reduce government spending and eliminate wastage across all layers of government. Vice President Osinbajo has indicated that the Government intends to increase government spending in 2016 by 56% from last year despite government revenue having fallen significantly over the passed year. It appears like the aim of the government is to inject vital liquidity into the Nigerian economy. That aim when considered with the monetary policies now being implemented by the CBN in recent times may be good news depending on where the extra spending is directed to and the source from which such funds were obtained. If the 56% increase in government spending is to come from greater borrowing (as appears to be the case) and the funds are directed not at investments that would yield revenue in excess of the amount borrowed plus interest but at feckless policies such as the 5,000 naira a month gift to the unemployed then Nigeria may be in for a long period of FG revenue constraints. Nigeria (as of the start of the year) had a debt service burden of close to 25% of revenues. If the FG embarks on a borrowing binge to finance unemployment payments to the unemployed as well as other FG projects, then the costs of servicing government debt will balloon. Indications are that non oil revenue to the FG has increased. That is a good development. At the moment, foreign investors remain nervous about FG economic policy. On balance, it appears to be a mixed bag. The CBN needs to bring interest rates down to 3% and ensure that bank lending to the real sector is done at rates that are firmly in the single digits. I would prefer for FG spending to be brought more in line with actual government revenue whilst leaving the CBN to focus on reflationary policies. The FG can do its part to reflate the economy by lowering taxes payable to the FG and embarking on fiscal policies that encourages the establishment of businesses and lowers the costs of doing business for the small scale businesses in the early part of their shelf life.
Corruption
The government has been methodical so far. It is too early to tell how successful this will be until sustainable convictions have been achieved in line with the rule of law.
Rule of Law
This aspect of the government performance has been the most problematic. The disobedience of court orders in the case of Dasuki and Nnamdi Kanu are worrisome.
Whilst I agree that Nnamdi Kanu is a terrorist and his threat needs to be addressed, the government should bring appropriate charges against the fellow and then hold him in accordance with the laws of our land. It cannot be seen to disobey court orders.
The interpretation of the law by the Attorney General of the federation in respect of the death of Prince Audu was truly baffling. His rationale seemed to completely ignore the existence of Section 36 of the Electoral Act of 2010. In any event, it is worrying that the Attorney General would be trying to influence an independent body such as INEC. It was always worrying for the President to have appointed an INEC head that is from the same tribe as the president himself. However that dubious choice that gives rise to the appearance of bias in an ethnic laden country such as Nigeria was unanimously approved by the multi ethnic council of state and the multi-ethnic senate. One can no longer solely blame Buhari for that choice. His ability to act independent of adverse influences from the APC FG is now seriously open to question.
Buhari definitely has his work cut out. It is too early to say whether he will turn out to be a good or a poor president. It is a welcome sign that the CBN is starting to take account of criticisms made of its economically restrictive policies. Hopefully, the president will be ever mindful of the adverse policies he may be pursuing and make adequate and timely modifications. Time will tell.
Dele.Awogbeoba@gmail.com