The Nigerian Economy and Elections 2011

February 25, 2011, Olufemi AWOYEMI, FCA

http://www.proshareng.com/articles/2226

It can be argued that those taking positions at either extreme of the recent
exchange/debate between the CBN and the IMF were being inaccurate or unfair to the
people of this country.

Wildly overdrawn justification of IMF’s “advice”, often made under topics such as:
'Nigeria’s Response to Prolificacy’, ‘IMF shows way out for the Nigerian Economy’ and the
equally derisive debunking that follows from the other side such as: ‘We have already
devalued the Naira based on the budget submitted by the MoF’, ‘CBN stands up to IMF’;
only appear to be opposite perspectives.

In fact, they are two modes in which the same weightless discourse is conducted.

The argument is unnecessary and is a complete waste of time

The devaluation question is a fall-out of the largely pervasive cultural malaise we are
prone to fall into every time as a nation; especially when the prolificacy that defines our
electoral process is on and the wheel of governance grinds to a painful halt.

This is a crisis brought on by our collective profligacy and lack of an integrated sovereign
plan to deliver on the state’s responsibility. This has manifested itself in too much
spending on consumables, too little spending on infrastructure, an unaccountable subsidy
structure, an oil revenue that cannot be accounted for and a lack of will to address our
infrastructural deficit.

The Nigerian economic status today has its root in a governance model that is not
premised on long term plans and a process of accountability to the electorate.

As a people, we fail to accept that there is not enough for everyone’s greed and that at
some point – the leadership of this country must manage the affairs of the state in the
same responsible manner it expects a disciplined household to do – earn every kobo and
spend wisely.

With the quick erosion of the middle class in the country where an average family
struggles to balance their budget, is unable to access credit for small business or to meet
what would otherwise pass for basic needs – housing, education and feeding; the people
all turn to the centre for a ‘piece of the action’. This is an unsustainable culture for a
forward looking society we seek to be.

Yet, that household that is expected to sacrifice and contribute to the economy by way of
taxes defines leadership by the ability of the parents to make decisions that reduces its
outflows on consumables, eliminate avoidable expenditures (including painfully personal
ones), and focuses his thoughts on increasing inflows by spending on those things that will
help create jobs for today and tomorrow; hoping that the adjustment made, will create a
more equitable future.

This is at variance with the free-spending executive-legislative leadership we have had

over the last five years. This did not start in 2010, but has grown to reflect a government
which appears oblivious to the risk element/vagaries related to its economic model in a
fast changing continent and world economy.

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Listening to the justifications giving for some of the expenses – it is a big wonder no one
has advocated for a complete change of the currency for a government which has grown
an appetite for spending on consumables/recurrent expenditure over and beyond its
leakage-prone resources.

The discourse last week has thus been rightly treated with expected indifference by the
populace and its elite – we are all pre-occupied with a momentary high – elections; with
all the promises of ‘quick bucks’ and a jostling for positions ahead of the post-election
office sharing that normally ensues.

This cannot be right! Every society expects its elite to have the intelligence to recognise
that the rate, nature and style of managing our economy is unsustainable; and we need a
new way of doing business in this country.

Neither of the arguments so far addresses the fundamental truth - that this government is
imprudent in managing our future.

The affairs of the state is conducted like the proverbial dream team without a game plan
that recognises the strengths and weaknesses of all opponents in a competition but
focuses on the media-dominated pairings; unmindful that the pairings is a communication
imperative to sell papers and not to win games.

It would appear that hoping, fasting and praying that the inevitable consequence of our
inability to have more than a 12-month plan for the economy – with integrated policies
that reduces the size of government, empowers small businesses to create jobs, retool our
healthcare delivery system, reposition the state of our infrastructure and rebuild our
educational system – the reliance on oil and the ever increasing tax collection drive to
grow IGR’s cannot stop this impending crisis.

It would have helped therefore, that in place of the exchange of advice and rebuttals; we
engage in a debate on who has the best plan to deliver such an integrated plan.

Did someone say that will be difficult to put together?

The late Professor Aboyade and his colleagues did put one together in their time. What is
therefore stopping this generation – one defined by world class scholars, accomplished
professionals and ingenious business managers - from putting one together?

With forty three (43) days to one of the most important elections in our economic history,
we have embraced the cheaper alternative wholesale – adopting ‘noise’ to hide the fact
any of the political leaders that may emerge will do so without any contract with the
electorate on the economy, nay our future.

That is the real news about the economy and the value of the Naira.

It is incredible that there are no specifics on the most pressing issue to guide the choice.

ADDENDUM:
We have reliably learnt that a Presidential Debate will take place at the ECOWAS Building, Abuja,
March 28th to 30th, 2011.

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