Originally, the lecture was billed to centre on the role of investment banks in developing economy, with Nigeria as a case study, but the American University of Nigeria (AUN) organizers of the 4th Atiku Centre Lecture Series believed that setting some agenda for the incoming administration of Muhammadu Buhari would be worth the while instead, hence, the topic, ‘Review of APC manifesto in context with current economic realities.’
The Robert Pastor Library and E-Learning Centre, venue of the lecture, was filled to capacity with lecturers, students and other members of the community who congregated to drink from the cerebral endowments of the guest lecturer from Lagos, Ike Chioke, managing director of Afrinvest.
Chioke said that given the ambitious manifesto of the APC, categorised into seven cardinal programmes- War against corruption, food security, accelerated power supply, integrated transport network, free education and affordable health care, devolution of power and accelerated economic growth- the party needed to take drastic measures to be able to meet the promises it made to the Nigerian people during the campaigns.
He noted that a “more than 50 percent decline in oil prices dampened Nigeria’s revenue generating ability and triggered significant devaluation of the Naira; Nigeria’s external reserve is down 14.5 percent YtD; The Monetary Policy Committee of the CBN increased the Monetary Policy Rate (MPR) from 12 percent to 13 percent in November 2014; inflation inched higher to 8.5 percent in March from 8.0 percent in December 2014.”
According to Chioke, “the ministry of Finance projected Gross Domestic Product (GDP) growth to slow to 5.5 percent in 2015; lower oil prices triggered cut in capital expenditure for 2015 Budget and increased borrowing may enhance budget execution.”
He said that given the economic realities, Buhari government must not afford to embark on “business as usual” but must wage a frontal fight against corruption in all its ramifications.
“If the incoming administration is serious about the fight against corruption, it has to be ready to fight because there are those who will resist it and fight back because their whole livelihood revolves around corruption. These are those who have collected the billions of Naira in the past and could have the capacity to fight back. It has to be a fight, and they are ready to fight for a very long time,” he said.
“If you look at the APC manifesto, they talked about blocking leakages; they did speak about looking at the cost of governance; revisiting the issue of merger of overlapping government agencies, ministries, departments and other institutions. I think that’s a very prudent way to start because if you take for instance, N3.6trillion government says it is generating at the federal level, it can be N4trillion- that is N400billion increase; it could even be much more than that; it could even be N4.6trillion which means that a whole N1trillion is actually missing and that is either because the cost structure of government is bloated. So, you are paying people who do not exist or that the revenue of government was diverted, what should have accrued to government did not get there.
“We heard what happened in 2012 when the then CBN governor raised the alarm that N1.7billion oil money was missing, and by the time government looked at everything, they came up with about N2.3trillion that was actually missing. When you look at the total cost of wages – payroll for that year which was N1.9trillion – so you are talking about more than total cost of employment of the entire civil service workforce. The huge amount went into a few hands; they are not more than 70 companies in the list of those in that scam,” Chioke, the investment banking expert, said.
Chioke further said the new government needed to review the actual crude production per day in the country, saying that it was unbelievable that the figure has remained 2.28 million barrels per day for several years.
“It has remained so for a decade. It has been flat for years and government does not do anything. It means that something is happening. The industry is quite opaque. There is serious lack of transparency. Those who think that the problem is with the illegal oil bunkering are really trivializing a whole huge issue,” he said.
He noted that most Nigerians have indicated epileptic power supply as the most important hindrance to economic development, adding that the African Development Bank (AFDB) estimates that the Nigerian power industry requires about $55billion of investment.
Chioke also said that Nigeria urgently needed to upgrade its infrastructure to meet the demands of the 21st Century.
According to him, to achieve the infrastructure needs of the country, “government must increase allocation of capital expenditure in the budget; create an enabling environment to attract strategic foreign direct investments (FDIs) and privatise the rail sector to encourage private investments and rehabilitate major airports in the country.”
Comparing Nigeria with Singapore, the guest lecturer noted that Singapore was in a fix like Nigeria and that it took the country about 30 years to turn around.
According to him, to move from the current point where Nigeria is to where it is supposed to be, there is need to borrow the Singapore model.
“Singapore’s government did not attempt to directly finance its industrial development, rather focused on private sector and strategic foreign direct investment,” he said.
It was his opinion that, like Singapore, Nigeria can still rebuild its pride by determining and celebrating national values, engendering positive attitude and entrepreneurial spirit, restoring or developing national symbols, inculcating respect for human life and property, and by promoting justice and equity.
Advising the incoming government to avail itself of the opportunity of harmless loans and other facilities that could enable it meet up with its programmes without much problem, Chioke, however warned that caution must be taken to ensure that such money, when sourced, should be properly applied to areas of need. He also emphasized that leakages must be blocked so that there would be enough money to channel into proper development projects.
Citing instances of institutions that had benefited from Afrinvest’s robust professional advice to seal deals and achieve gigantic projects, he said that the incoming Buhari government can approach some of such institutions to enable it meet up with the election promises.
On the intention of the APC government to allocate 15percent of the total annual budget to the education sector and the promised free education, Chioke said: “I think the challenge for us in education is that we need to re-examine the system. If you contrast the system (primary, secondary and tertiary education) what we have in the country with what is happening in AUN, where they have deployed ICT so that we can reach primary schools or IDPs, and those children who don’t have a home, but they can play with Samsung iPad, there’s so much difference.
What we are talking about is not whether 15 percent is enough or not; the major challenge is how you deploy the available resources, the structure you put in place to get things done well; we have over-bloated recurrent expenditure where there are lots of administrators than the teachers, paying salaries and wages, but we must begin to focus on deploying the money where it is needed, where the output could be seen and measured. How many kids can read and write, etc, that can bring them to 21st Century; these are the things the incoming administration needs to look into.
“I visited Rwanda some years ago; I went into a classroom where primary school children use iPad to learn in a free-education policy. What I am saying is that it can be done here, but I don’t think that such can be done under the educational policy we have now in the country. If we continue to do it the way we have been doing it, we end up having teachers who do not add value to the system (remember Governor Oshiomhole’s experience with some teachers in Edo State). Many of the teachers cannot read and write.”
At the end of the lecture, the audience, made some suggestions which the university said it would compile into a communiqué and forward to the President-elect for further action.
The audience suggested that the incoming government should pay special attention to information and communications technology (ICT); trim down ministries, agencies and departments, strengthen the institutions and making them workable; reduce cost of governance, carry out reforms by making political appointments unattractive, de-emphasise over-dependence on oil, but encouraging states to look inwards; emphasise the need for government officials to patronize government-owned institutions such as schools, hospitals, etc; sustain and improve on programmes that encourage entrepreneurship in the country, such as YouWin programme, among others.
Zebulon Agomuo
