Buhari’s change in progress

By Oladayo Orolu

The anniversary of the first year of the APC government came at a very challenging period in the socio-economic sphere of the Country. It is such a period that the realities on the ground elicit looks of confusion among even the ardent advocates of ‘Change’ as to the real meaning and intent of the ‘Change’ government. There had been different reactions, opinions, assessments and judgments expressed by different schools of thought depending on which side of the divide they belong. In the assessments, there seemed to be a consensus of opinion that the Buhari government has performed creditably well in taming the Boko-Haram menace that was fed fat under the previous administration. Similarly, there were mixed reactions on the anti-corruption drive, with many mistaking the probe to be an anti-PDP exercise. However, the release of the huge amounts in Naira and foreign currencies that have been recovered wholly or under interim forfeiture, has silenced not a few critics of the corruption probes.

The Opposition has been vociferous on the state of the economy. Many have been gloating that Nigerians ignored their warning and chose President Buhari whom they described an illiterate on economic policy matters. To add energy to their fire, the National Bureau of Statistics (NBS) released latest GDP reports showing negative trends across board. Prior to that report, the NBS had equally published the consumer price index indicating a higher double digit inflation rate, the highest in recent years. The news headlines were screaming – recession looms! Whatever could have been the subtle and even obvious achievements of the Buhari’s government in the economy were overshadowed by the negative narratives. These revolved around the looming recession with many labeling the government’s policies as archaic and directionless. President Buhari played a major role in the negative perception of his government’s capacity to solve the nation’s economic problems. His decision to have a full cabinet six (6) months after assuming office set the tone for the lull in the economic activities. The aim of this write-up is therefore not to, like a sycophant or extremely optimistic, praise the government in the midst of the present economic crisis, but to make Nigerians see the other side of the coin. How worse could things have been?

The Nigerian economy in the pre-Buhari era was completely dependent on oil. It’s therefore not surprising that with the crash in the crude oil price in year 2015, the worst was going to happen. Buhari’s predecessor celebrated an economic growth that was built around a few individuals and measured by the increase in number of private jets owned by the privileged few. Government revenue increased significantly but without any corresponding increase in the nation’s reserves or direct improvements on social infrastructure. Rather, government spending and debts accumulation were taken to unprecedented higher levels. By May 29, 2015, civil servants across the Country were owed salaries, with many states crippled economically. This, coupled with foreign exchange scarcity arising from the reduced government earnings, set the tone for what is being witnessed today. That we have managed to survive so far is a credit to the Buhari’s government. It could have been worse.

In many of the analyses, focused and stressed on the negative trends of the economy, it was almost concluded that Nigeria’s was an isolated case. It must be stated however, that not a few economies around the world, especially the oil producer nations, recorded economic downturn during the period under review. But, in this same period of economic contraction in Nigeria; Agriculture, Mining, Entertainment, and Information and Communication sectors, among others, recorded moderate growth, albeit at a lower rate than previous periods. It is also in this same period that the Government, through the full implementation of the TSA, mopped up about Three Trillion Naira of public funds previously kept legitimately or otherwise in commercial Banks providing cheap capital to the Banks at public expense. The ‘almighty’ NNPC has also been turned from a never-do-well conglomerate to one with focus on profitability and efficiency. The importance of all these lies in government’s efforts at achieving sustainability, transparency and accountability at the centre, ensuring government purse is kept afloat at any given time.

The Central Bank’s ‘demand control’ management of the Naira/US$ has yielded mixed results. On one hand, it has led to the widening of the gap between the official price and the parallel market, with upside arbitrage opportunities, and reduction in direct foreign portfolio investment. On the other side, it has opened more opportunities for local manufacturers of many goods on the prohibited lists. For the first time, major international retail outlets are openly seeking local producers of products that were previously imported by default. The Tomato paste business, for instance, has recorded major success with many plants coming up within a short frame. Nigerians’ appetite and propensity to spend on imported consumables seems to have reduced.  It is however important to add that the non-availability of sufficient ‘fx’ for valid trade transactions must have contributed in no small measure to the contraction in the non-oil sector of the economy. The current plan of a more flexible exchange rate policy should be geared towards relieving the current deficit overhang and ensuring free flow for future trade activities.

Communication has not been effective in the Buhari administration. It is either the government is too slow in providing the right information or the information is not passed across in the appropriate form and manner, thereby leaving room for rumours and speculations. For a long time, many Nigerians believed there was no economic management team in place alluding to the absence of an overall economic direction. The contrary was the case. The role of informing the public on key economic policies, plans and actions, should not be left to appointed spokespersons, rather, the responsible subject-matter experts. A case in point was the President’s working visit to China where some far reaching agreements on economic and currency issues were initiated. Surprisingly, both the Finance Minister and the Central Bank Governor was on the trip. The task of providing information on the very important Naira-Yuan deal therefore fell on the Minister of Foreign Affairs. The result was more confusing than cheering.

The task of building a diversified economy with institutionalized transparency, responsibility and accountability is not done in a jiffy. The Buhari administration looks determined to do things differently from the past and set Nigeria on a sure-footing amongst top economies in the world. Having overcome the shaky and slow start, with a welfarist oriented budget for implementation in 2016, positive signs should begin to unfold in the later part of the year. However, the government’s ability to resolve the renewed Niger-Delta militancy, without compromising on the ideals of good governance, is a key step in achieving its short-medium term objectives. Like the duck paddling vehemently beneath, yet looks unruffled in the surface; the process of the Buhari’s Change has started and indeed, in progress. The results will surely manifest today, tomorrow and in the future. God bless Nigeria.

Orolu writes from Lagos, Nigeria.