There is a lot of hope riding on the Buhari government. Too many people have an illogical expectation of the Buhari government, illogical in that their hope does not reflect the scale of the challenges we face as a nation. How do I know this? Too few people are having the sort of conversations that is focused on finding the structural solutions to our teeming problems. Some of those that are having it like Onye Nkuzi are unnecessarily and occasionally confrontational especially when there’s no Martin Luther King to their Malcolm X.
The truth is if we truly want Nigeria to get on the path of becoming better, then it is likely that the most appropriate solution is also the most painful one. Painful in that some people will have to accept to lose their jobs (mostly civil servants) and seek alternative means of employment that adds value, others will need to go to jail but more importantly many will need to give up some of their inadequate earnings in form of taxes to fund government. Leadership is extremely important on the journey Nigeria is about to embark on from May 29 but as a result of the sacrifices, individual and collective that need to be made, followership will be equally as important.
No shortcut can be taken by Nigeria if we are to fulfil our potential and deliver on democracy. Politics and policies based on sentiments, religious or ethnic, should have no place in our discourse. Our ideology has got to be clear, strategic and precise. In fact, any party that has no clear and strategic ideology on how to move Nigeria forward should henceforth never be accepted at the political table or consciousness.
There’s a lot wrong in Nigeria, and a lot wrong with Nigerians. We seem to get too easily distracted by the mundane e.g. President-elect Buhari shaking the hands of Mrs Oshiomole. Surely, there are far more important socio-economic issues to discuss and lose decorum on than who the President-elect chooses to shake? We far too often expect more from others than we expect of ourselves. We are too quick in moving the ‘goal post’ when a person of interest is concerned. The value of our truth and objectivity far too often depends on how far removed we are from the ‘accused’. On to more important issues…
If governments in Nigeria are going to deliver on good governance, then we need them to be completely reliant on the citizens – politically and economically. Politically in that every Nigerian of voting age should be encouraged to be electorally engaged, that every vote must count and that there should be no room for electoral malpractices. Every instance of electoral fraud must end in jail terms for all guilty of electoral fraud. No ifs, no buts. Further, the government also needs to be completely economically dependent on its citizens i.e. government funding is mainly dependent on income tax, value added tax, property related taxes and then corporation tax. We need to re-establish the link between government and business. The raison d’être of government should along with protecting the lives of its citizens also be securing the interests and improving sustainability of businesses.
Our current structure confers full responsibility for the development of Nigeria on the federal government as evidenced by the composition of the ‘exclusive legislative list’. This structure also handicaps the same federal government from being able to deliver on the development with circa 50% of government revenue outside the control of the federal government. It is why in my opening gambit I said that the expectation on President-elect Buhari is illogical as he lacks full control of the resources necessary to deliver on what he promised and what people are hoping for. Whilst it is ‘theoretically’ possible for him to deliver on these expectations, and for this to happen, there’ll be a need for “divine never-before-seen-in-the-world coordination” among all tiers of government. The coordination will need to work better than clockwork.
Whilst I am an advocate for the enshrinement of true fiscal federalism, power and resource control devolution, I am also aware that devolving too quickly and too soon to tiers of government that are unprepared will probably not achieve the aim of devolution. Besides preparing the various tiers of government for handling new powers, the citizens also have to be fully sensitised to appreciate the new structure and its shortcomings. There will need to be a transitional framework for devolution – a framework backed by law. Just giving states or local governments the constitutional power to grant exploratory licenses on natural resources will not be enough to avoid the mistakes of Abuja and the past. I think we need to go further and sanitise revenues derived from such activity. Sanitisation will help to avoid transferring the resource rent curse known as the Dutch Disease from federal to state or local governments.
For example, let’s assume oil was discovered in the Niger Delta in 2015. Instead of going with our current method of accruing and immediately spending the revenues generated per barrel of oil, the revenues could be deposited in a reserves account held outside Nigeria with oversight maintained by the CBN for the benefit of ND states or future generations of residents of the ND. As part of licenses granted to companies by ND states, a local content law could be added that requires and encourages licensee to employ locals at fair wages, invest in local research & development institutes to produce future local scientist and engineers. The government could for example ensure that at the time or as part of the granting of crude exploration licenses, ‘value added services’ firm/industry (e.g an oil refining industry, port facilities, airports and other transportation infrastructures) are also encouraged to be created perhaps through PPP’s or targeted policies that encourages specific FDI into ancillary industries. The government will then need to depend solely on income tax, VAT and corporation tax generated from these industries for funding rather than resource rent directly.
Besides the better governance that this sanitisation (keeping government hands away from resource rent) is likely to incentivise, there are also the additional benefits that the nation’s currency will be properly valued with currency valuation likely to be better linked to real productivity, remove the need for CBN to intervene in the forex market and make manufacturers/exporters more competitive. Again this will need to be implemented as part of the transitional framework due to the level of infrastructural deficiency as well as current over-dependency on oil revenue from the ND.
The oil industry is now quite rotten and the above approach will be difficult to implement in it. However, we have the mining industry to use as a test case for controlled devolution of power with non-oil natural resources geographically well spread. Further, due to advancement in technology especially electronics, growing global population, increased regulation for green technologies, the demand for strategic resources is increasing at a rate much faster than supply. Some of these strategic resources are abundant in Nigeria e.g. uranium, tin, iron ore, niobium, natural gas, arable land etc. The task is to not limit the development of the mining sector to just extractive industries but to ensure we can also process extracted resources within Nigeria. We need to get ahead of the curve of the increasing global demand for strategic resources. Rather than creating federal universities willy nilly, we should be establishing specialist educational and research institutes that will produce deep thinkers, scientists and engineers of the future. Our mining industry has been ignored for far too long. It’s time to roll up our sleeves, learn from the mistakes of the oil industry and correct it in the mining one. It’s time to create the best mining industry in the world and we can use the transitional framework strategically to this end.