 Hurdles on the way to prosperity
To the ordinary Nigerian, however, such optimism has, for the last two decades, proved incapable of satisfying his growing hunger for good governance that has remained elusive. He sees himself as a hewer of woods who has no commensurate returns on the volume of sweat he has had to produce in the search for a good quality of life.
His pessimism is not misplaced. The economy is still in bad state. Public utilities are less than efficient. Private companies' capacity utilization has dropped from 34.32 per cent in 1998 to 30.31.per cent in the last six months. The macro-economic indicators are showing red lights: inflation has hit double digits, the naira continues to fall, closing in on N100 to $1, the rate of unemployment is high and foreign reserve was down from US$6billion to US$4billion on May 29, when the military handed over power to the civilians.
The outgoing government did warn the new administration on the paucity of the reserve. Abubakar gave a list of spendings which though drained the reserve , he said his government could not afford to ignore. These include the money spent to conduct elections into the various offices, to host the FIFA 10th World Youth Championship, to refurbish the nation's refineries that have been abandoned for 25years and to meet the new minimum wage of =N=3,500(US$35) and =N=3,000(US$30) for the federal and state public workers respectively. Abubakar also reveals that a lot of money was spent putting up structures like the National Assembly Complex, Legislative quarters and the Eagles Square where the new government was inaugurated on Saturday, May 29.
Notwithstanding the nation's empty purse, the expectations from Obasanjo would also require massive spending. The populace are expecting instant welfarist approach that will lead to relief in areas such as food and housing, despite the heavy burden that comes with democracy with the three arms of government in full operation. The executive with the full compliments of numerous officials; the legislators which include the senators and members of the House of Representative, and then the judiciary.
Unfortunately however, these expensive responsibilities are coming at a time when the revenue accruing from oil export has fallen by about 60 percent. The immediate past Chief of General Staff, Rear Admiral Akhigbe (Abubukar's Second in Command) reveals that the receipt on oil has fallen to a little above US$3b from the US$10b it had been.
As ambitious as the president appears to be, the diplomatic face-off between Nigeria and major countries of the world during General Abacha's administration remains a draw back. Even though the democratization and the improved human rights record have earned Nigeria back its place among a comity of nations, the international financial institutions are not willing to untie the noose on the nation's meager earnings.
Obasanjo continues to fight the thought that not less than 30 per cent of the nation's annual earnings would go for debt servicing. IMF reiterated its intransigence on this issue recently at a conference on the Highly Indebted Poor Countries (HIPC) initiative in Washington.
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The president has cried out several times for debt forgiveness, but it looks unlikely that the World Bank and IMF would yield to anything like that. The financial bodies would rather want to see a high level of commitment to and consistency in debt servicing before any consideration of debt rescheduling could be contemplated.
Obasanjo is fully prepared to pay the price as tall as the conditions are:
"Nigerians will be asking me for democracy dividend, which is nothing more than an improvement in their living conditions. I cannot do this, unless I have debt relief"
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Therefore "I have stuck my neck out," he challenges," you want openness, I will open up. You want transparency, I will give you transparency. After that what else is the West asking me to do? Cut my neck? Bleed Nigeria to death?'
Nigerians, as much as they would want to acknowledge the emergence of a new day, the myriad of problems confronting the country are making them reluctant in rolling out drums for celebration. The parlous state of the economy which became too glaring before the swearing in of the new administration is driving the morale of the people to the ground. The level of skepticism is high stemming from Nigeria's harvest of bad leadership which has made them live below the poverty line despite the country's natural endowment.
Political instability however remained Nigeria's greatest albatross. Military incursion into its polity since the first coup of 1966 effectively ensured no participatory government for 30 of Nigeria's 39 years of self- government. And the experience that comes with the autocratic rule of the military however shows a discontent to an idea of a free market necessary for the re-engineering of the economy. But Nigeria has managed to stay afloat as the massive oil deposit since the'70s and the rising world oil price which peaked at US$40 per barrel in 1980 guaranteed the country a tottering survival. Nigeria's oil annual earning stood at an impressive US$25 billion during the same period and the economy's brightest chance of real growth was around the corner. The economy mouse only needed a right click to transform the so called giant of Africa to a world economic power. But somehow, inadvertently too, the various administrations have learnt to mount hurdles on the road to prosperity, through restrictive legislation which shut the doors against foreign investors.
A former finance minister, Chief Anthony Ani reviewed this scenario at the 3rd Nigerian Economic Summit of September 1996 thus: "It is obvious that having been starved of private foreign investments for about 25 years, and if the economy must grow, we must open up our economy and continue to create a conducive investment atmosphere for investment to flow into the country," he warns.
Incidentally, General Olusegun Obasanjo, now Nigeria's second executive president was the country's military Head of State between 1976 and 1979. He ruled then with an abiding interest in protecting Nigerian enterprises from competing with superior foreign companies and through his indigenization decree, Nigeria played itself out of the field of the global competitive trade. |
NIGERIA
