Entering 2016 with trepidation

I spent the Christmas holiday with my family in Kwara State as I do every year. However, when I arrived Ilorin last Thursday, I could sense a feeling of foreboding that this was an unusual season. Everywhere I went, the stories of deprivations and lamentations were the same. The challenge was further compounded by an acute fuel scarcity which made many motorists to spend days and nights at fuel stations. Incidentally, four days before arriving the city, two persons, a taxi driver and a commercial motorcycle rider, (otherwise known as okada rider) were crushed to death by a passing train while they were on the queue for fuel. And throughout the Christmas holiday season, several of the roads were blocked by desperate motorists who were seeking the elusive commodity and the situation never improved.

The story is that there is one official recently posted by the Nigeria National Petroleum Corporation (NNPC) as station manager in Kwara State who vowed that under his watch, no fuel station would sell the product at black market rate. Whoever this enforcer of a man is, he succeeded with his promise for which he deserves commendation. The problem, however, is that he created another problem for those who would rather have the product without having to sleep at fuel stations. For such people, and they included hapless taxi drivers and Christmas visitors, they had to commute back and forth to Ogbomosho in Oyo State to buy the product that sold at N150 per litre in fuel stations.

Unfortunately, as year 2015 draws to a close today, there is no certainty that the problem of fuel scarcity will abate in the year to come since there is as yet no coherent policy decision on the downstream sector of the petroleum industry. While some people may be deceiving themselves into believing the product sells for N87 per litre (and from tomorrow, N86.5!), the reality is something else: the price has unwittingly been “deregulated” by those who are adept at profiteering at the expense of our people. And they also continue to exact maximum punishment by ensuring that we suffer before we get the product at whatever prices they choose to sell.

Also while in Ilorin, there was a story about a prominent woman in the city who had travelled to Dubai. While checking out of her hotel last week, she presented her Nigerian Bank debit card to settle the bill, having been assured by her account officer before she travelled that she was covered. As it would turn out, the hotel receptionist informed her that the payment was declined. She called her account officer in Nigeria who, after blabbing, informed her that it was a new policy which took effect from that day. The woman had to pawn the jewelries she was wearing to settle the hotel bills!

For sure, the days, weeks and months ahead are bound to be rough and we have only ourselves to blame for the choices we have made over the years, choices that have now caught up with us. The challenge, however, is that this is the time we need a leadership that would be courageous enough to take some hard decisions that may be painful in the short run but would ultimately help in repositioning our country. Fortunately, President Muhanmadu Buhari has the character and still retains a measure of goodwill should he come to terms with the fact that populism at a time like this will amount to digging while already in a hole.

The problems confronting the nation today require more than ad hoc solutions since their manifestations are everywhere. A report released in June this year by the Nigerian Labour Congress (NLC) Task Force on Employees’ Salary Arrears revealed that 23 out of the 36 states of the federation could not meet their obligations to workers. As at that period, some of those states owed salaries for as many as nine months. Unfortunately, the situation has since worsened as oil price takes a nose dive with many of the states not only in dire straits but also clueless about what to do in the circumstance.

The pertinent question remains: if these states cannot pay the salaries of workers which ordinarily are a basic requirement, how do they address more serious problems? In many of these states, most of the critical sectors like education and health have virtually collapsed. Unfortunately, one can almost say the same of the federal government which also finds it difficult to pay salaries.

However, I sympathise with President Buhari who comes to power, having campaigned on certain assumptions that have now unraveled before his very eyes. According to Central Bank of Nigeria (CBN) figures, the total revenue collection for the federation in year 2012 was $40,561,793,365.83. We can round that up to $40.6 billion. And we are talking about the totality of the revenues from the NNPC, the Federal Inland Revenue Service (FIRS), the Directorate of Petroleum Resources (DPR) etc. A year later in 2013, that sum had dwindled to $37,520,087,145.54, which can be rounded to $37.5 billion. By 2014, the collections had improved marginally as $38,630,800,832.85 (roughly $38.6 billion) was raked in. Now, wait for this! By the end of November, just last month, only $14,887,315,845.29 (about $14.9 billion) had been realised. That means we are talking about less than 40 percent of the earnings for previous years!

With such a huge gap, it is easy to understand the predicament of the CBN that has been throwing everything (orthodox and unorthodox policies) at a problem it did not cause and which may not go away very soon. It is compounded by the ease with which some unscruplous Nigerians game the system to the detriment of our national economy.

There is a story in a recent edition of the Wall Street Journal (WSJ) that says so much about our country. While the value of rice imports to China in 2014 was $1.23 billion, the value of rice imports to Republic of Benin was $1.02 billion. Similarly the value of frozen chicken import to the United Kingdom in 2014 was $47.7 million, while the value of the imports of the same commodity imported by Republic of Benin was $42.6 million. On top of the chart, this was the caption written by WSJ: “Tiny Benin imports as much rice as China and nearly as much frozen chicken as the UK. Most of it is smuggled into neighbouring Nigeria.”

What that says most eloquently is that we are dealing not only with monumental corruption and associated problems like smuggling etc. but also with some serious structural problems in the economy that require short, medium and long term solutions. That we are in a difficult national situation is very evident but the moment also comes with its opportunities.

For years, we have made a song and a dance of “diversifying the economy from oil” without taking much concrete measures in that direction. Now that the situation has been forced on us by the downturn in oil prices, we cannot afford to waste the moment. The good thing is that Nigerians are not lacking in ideas. For instance, I have read Professor Bolaji Aluko’s interesting intervention on what we could do with our gas reservoir both for power and domestic consumption and it is also clear that there can be no better time than now for private refineries with the attendant multiplier effects on our national economy. I am sure other opportunities abound in several areas for generating much needed revenues for our country, putting our people to work and putting money in their pockets.

All said, 2016 is a crucial year for the nation and the choices we make (or refuse to make) could have reverberations for many years to come. I therefore urge President Buhari to assemble a strong economic team that will help in coming up with policies aimed at addressing some of the economic ills that now plague the nation.

I wish all my readers happy new year in advance.

*This article first appeared in THISDAY.

RIGHT OF REPLY

Between NCC and the Consultants

By AbdulRahman Abiola-Odunowo

Dear Segun,

I have just read your back page on the MTN saga and wish to correct some misrepresentation as it affects the appointment of SIM registration consultants and the N6.1billion approved for the project. Please note that the NCC appointed the seven data capture consultants in the first place because of the unwillingness and refusal of the telecoms operators to capture the data when asked to do so by the NCC. The operators had claimed they had no such capacity aside the fact that they also saw no reason for the exercise. Therefore, the consultants were ONLY mandated to capture records of already active SIM cards while the service providers would capture the records on new SIMs being sold by them.

On the budget for the exercise, each NCC consultant was given one of the six zones in the country to cover with an expectation that an estimated number of existing active SIM records would be captured for the NCC. The N6.1billion approved for the project was based on an estimated number of SIM records to be captured by all the consultants at the end of the exercise.

Specifically, the NCC provided a specification (data dictionary) for all consultants to comply with while capturing the SIM records. The National Identity Management Commission (NIMC) consulted for the NCC in provision of the data dictionary so that all collected data would also meet the National Identity specification. The NCC conducted proof of concept (POC) with all service providers to ensure that their chosen software met its expectation. While the seven consultants were expected to capture the SIM records in line with NCC specification (data dictionary), NCC was exclusively responsible for putting in place a back-end server where all data collected would be deposited, processed and synchronized for elimination of double registration.

All the seven consultants appointed by the NCC succeeded in capturing data and submitted same to the NCC in line with terms of the contract. The service providers also joined the process of collection and delivered SIM records to the NCC. However, the NCC unfortunately did not have its back-end up and running on time to carry out the processing and synchronization of records for the elimination of double registration. This was the main issue with the project and due to this delay, NCC has only paid about N2.2billion out of the N6.1billion budgeted to the consultants and has refused to honour its obligation under the contracts executed on the project.

Based on the above, it is important for you to please correct the impression created by your article that N6.1billion was paid to the NCC appointed data capture consultants despite not delivering on the project. The terms of contract were such that payment is only made for records collected in line with the NCC specifications to which we fully complied. Finally, please be informed that the SIM registration problem was as a result of the extremely weak regulations regime by the Dr. Eugene Juwah-led administration of the NCC and nothing else.

Abiola-Odunowo is Group Managing Director/CEO of PNN Group