Gbenga Olawepo-Hashim is the presidential flag bearer of Alliance for New Nigeria (ANN). In this interview with RUTH CHOJI, he speaks on the state of the economy and devolution of power to the stated among other critical issues.
How can Nigeria wriggle out of the economic morass it is anmeshed in?
Even when Nigeria was not in recession, the size of the economy was small. $510bn GDP is a small-size economy for 180 million people and that is why the people are grappling with poverty and squalor. The structure of the economy which makes it an exporter of raw materials has also put it in such a disadvantage within the context of the global economy. In the year when Nigeria was said to be earning so much from oil, the total revenue of the country was still less than $50bn in that year. In that same year in 2013 for instance, the economy of organizations like Disney World that produces entertainment, stripes and promote characters like Mickey Mouse made almost the same revenue, precisely $47m that year. This is just one company in Florida. Even if no cent is stolen from the oil profit in Nigeria, Nigerians will still be poor because the size of the GDP is poor. So, we have a national economic development plan which is aimed at expanding the GDP from $510bn to a target $4trn economy in 10 years time. That is the only size of economy that will make Nigeria a middle income country, which will place the citizens at the same per capital income between $16,000 to $18,000 just like Malaysia, which Nigeria was once at par with at time of independence. I am not saying that our target should be like America whose per capital income is about $50,000 every year but we should be at the same level with people that we have been at par with at independence. We were ahead of Malaysia at independence. Nigeria was not as bad and disorganized as this in the early years of our independence.
Where did Buhari government miss it?
They did so many things wrongly. The first thing they did wrong is that, the president does not understand economics and he interferes so much in the economic activities that he knows nothing about. They came in and had a currency crises due the fall in oil revenue. When that happened, it fell a little bit to around $40 to $45 per barrel from between $70 and $80. But everybody has always known that oil price is a cyclical movement, sometimes it comes down, and sometimes it goes up. In 1999, when the military disengaged from power, oil prices was as low as $20pb. So for the prices to be at $40 to 45pb, it was relatively high compared to the time of Obasanjo. So it was not a reason for panic and shouting. Some of the measures that the Buhari government adopted like introducing capital control was like taking the economy in reverse gear. Everybody held to their hard currency which led to scarcity in the market, then Naira started a free fall. The economy was drained of external liquidity because prior to this government, there were other sources that are funding the foreign exchange market like the FDIs (foreign direct investments), there were remittances from Nigerians abroad which by 2013 had reached a peak of almost $27bn. It was competing with the revenue from oil and all these revenue sources don’t want anything like capital control which the Buhari government introduced and imposed on the economy. Therefore, these sources of revenue dried up. So the economy was denied of external liquidity. Internally the government also moved all the currency in naira into what they call TSA. They were issuing bonds at 10% and they grounded the manufacturing sector, so nobody could access liquid cash. When you dry up external and internal liquidity, it is like you are draining out the blood of a human being and all the water in the body, the person will die naturally. So they killed the economy. It was a result of illiterate economic steps. Anybody who went to school and read ‘O.A. Lawal’ and other basic economics at ‘A’ levels knows that you shouldn’t have done that. You don’t need to be a professor in economics to know that it was the wrong step. The other thing is the fact that, when the Central Bank was trying to apply measures to control the crises, anytime they applied the measures, the president will go on television to say that he didn’t approved of it. Investors don’t like that kind of contradiction from those who are charged with fiscal and monetary policies. As a president, your job ends at appointing the Governor of CBN. If you want policies to go in a particular direction, you should get someone that will follow that direction. But once he is there, he will follow the rules and international practices to manage monetary policies. So you don’t expect the president to be struggling with the CBN governor or the media over monetary policies. That was wrong. We are not in a military government and investors don’t like that kind of thing. When they see such situation, they hold on to their money and refuse to invest it in the economy. So it was not the fall in oil prices that drove the economy into recession, Nigeria has had fallen oil prices many times and it didn’t go into recession. It was just the way they managed the crises that put the economy in recession. In any case, Nigeria was not the only country that had fallen oil prices, it effected Angola, and the Middle East states yet they didn’t go into recession.
Are you in support of calls to restructure Nigeria?
For me, it is not about the word restructure, but do we have to rearrange the way power is distributed between the states and federal government and I will say yes, we need to do that because there is too much concentration of power in the hands of the Federal Government. States should have some rights to make policies that will promote rapid economic development. For example, the way the distribution of power is arranged on the Exclusive List is not encouraging economic development at the lower level. For instance, an issue like transmission of electricity, if states are allowed to build their local grids, I know states like Ogun and Lagos combined together can net over a $100bn in investment in the power sector of those states because in those states, you have consumers who already have a culture of paying their bills, therefore investors are quite sure that when they invest in transmission and distribution in those areas and power gets to their customers, they will get their money back in record time with good profit. But now, they know that when they produce power, distribution is not in their hands. So if states are empowered and allowed to build their power grids, you can get an investment of over a $100bn. That is like 25% of Nigeria present GDP. That is an example of what devolution of power can mean. It also means that, a state like Zamfara will have its own ministry for mineral resources and therefore, you have small size investors that will go there and invest without coming to Abuja to convince somebody in Cadastral House that they want to do an investment. The central government is so loaded with power that makes economic development at the lower level impossible. It also encourages inefficiency and corruption. Any system in the world where you have to go and meet one emperor before decisions will be taken is prone to abused. Nigeria is an example of where there is absolute power at the center and nothing serious at the lower level. That is why you see people having so many meetings in Abuja where the officers will come out with red eyes and they easily collapse, they will tell you they haven’t sleep for days. This is because the system is not organised for efficiency. Donald Trump who runs the biggest economy in the world plays golf, he goes on weekend and still look like a human being because he doesn’t deal with small issues, yet their economy is growing now more than any other time you have ever seen in America. A lot of people are afraid about the word restructuring, but I am not concerned about nomenclature, what is clear to me is that we must decentralized power.
Is the political class determined to stop rigging in 2019?
I have seen lots of determination from what happened in Osun. I saw how people came out against all odds and voted for what they want. It’s about whether the incumbent government is ready to allow free and fair elections or not. That is the question that only Buhari can answer.
Do you think INEC is capable of delivering free, fair and credible elections?
Whether they like it or not, they must deliver clean and credible elections because the consequences of not doing that will be grave for Nigeria. I think the people heading INEC are patriotic Nigerians who are equally concerned as citizens of this country for the unity and stability of the nation.
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