“The future does not belong to those who are content with today….timid and fearful in the face of new ideas and bold projects.”
Late Senator Robert Kennedy, brother of President Kennedy, both killed by gunmen. VANGUARD BOOK OF QUOATIONS, VBQ, p 71.
Today the relative peace and security of the Federal Republic of Nigeria is held together, not by Buhari, or the Army — irrespective of the number of Cobra or Python dances organised to terrify the citizens of this country. Our relative peace is still guaranteed by the fact that the Nigerian economy has not collapsed. And the economy has not collapsed because of crude oil; because we still manage to earn sufficient revenue from crude export to keep the Nigerian house from falling like those hit by Hurricane Irma in the Caribbean Islands. When the revenue inflow reduces significantly and hardship bites harder, one million people in uniform dancing all over Nigeria will not be able to save our Republic.
Unfortunately, like some of the inhabitants of the places devastated by the storms in the US and the Southern hemisphere, we have not started to heed the warning signs and to prepare Nigeria for the economic calamity threatening us; which when added to the political tension will demonstrate to all of us the limits of the power of the military to stop the march of historical events. But, first, two diversions.
Proscription of the Indigenous People of Biafra, IPOB, by an Abuja Court on account of an ex parte application made by the Federal Government was a waste of everybody’s time. The short term effects will eventually be outweighed by the long term damages as history has amply demonstrated. IPOB is an idea and you can never eradicate an idea with guns. If it had been possible to do so, neither Christianity nor Islam would be around today. The Justice, in his flawed wisdom, signed the proscription order for IPOB. Fine. What happens if the same set of people open shop under a different name? That question points to the folly of the measure. It won’t stamp out IPOB; it will only send it underground where it will join with other “banned” organizations like Boko Haram, ISIS, Al Queda etc. History is replete with examples of groups proscribed by governments and which survived for years as underground and then truly subversive elements. Once a nation pronounces a death sentence against millions of its own citizens it immediately sets up an army ready to take as many people as possible down with them. IPOB will not die; it will be transformed into something else. And, for a start, the US has distanced itself from the terrorist tag. So, we can expect no support from there.
At any rate, since the FGN in its infinite wisdom decided to open another war front, the first thing we all need to know is that war is a very expensive project. “An army marches on its stomach” according to Napoleon, 1769-1821, who marched several men all over Europe knows how costly it can be. While marching, they also wreak a lot of havoc on the civilian population as well destruction of properties which took hundreds of years to build. Not only must government find the funds to buy the weapons needed to fight the war; it will have to find even more money to re-build damaged infrastructure – as grossly inadequate as ours are now. A weak economy, one still tottering on the brink of intractable recession is not the ideal background for another war. But, we are in it now. The question is: how do we build the strong economy which can withstand the strains which additional demands for guns brings when gari is in short supply and famine is a distinct possibility?
Appropriate leadership is paramount. By the time people are reading this column, the current administration would have used up two years and four months of its allotted four years. More to the point, Nigeria is now only seventeen months away from the next elections. By 2019 Nigerian would have discovered that crude oil can no longer support us and that the future looks very bleak if we continue to rely on it. Yet, we have a government whose leaders act as if we were back in the days of starting out as an oil producing nation still full of hope instead of one of few producers who wasted the God-sent opportunity. We are led by a government wedded to economic illusions and self-deception. That is what we have to change fast before the roof caves in on our economy. Permit me to illustrate some of the ways the Buhari administration continues to lead us astray with respect to the future of our economy
Ask Buhari’s Ministers how much crude oil Nigeria exports per day since January and you will receive an answer like “close to 2.2 million barrels per day”. That is the figure they have drummed into our heads in Nigeria because the 2017 budget was based on that self-delusory figure. But, on September 22, 2017, Dr Kachikwu pleaded with the Organisation of Petroleum Exporting Countries, OPEC, to extend the exemption granted to Nigeria in November 2016 because although our exports hit 1.8 million per day in August it was no justification to cap the country’s exports and that the country would be prepared to cap its crude production when it has stabilized at 1.8 million barrels per day. The meaning is very clear. Even on our best day, we steadily produced twenty per cent less crude than was budgeted and what government officials were announcing. The financial repercussions soon followed. By September last year, N770 billion had been released for Capital expenditure; by September this year, only N350 billion was available.
Surprisingly, when three Ministers went to brief Buhari they painted such a rosy picture that the President announced through his Special Adviser on Media that “things are looking up”. Obviously, we have a captain who does not know that the ship he controls is sinking. And, he will never know because he had himself confessed that “economics confuses me”. That is precisely what we can no longer afford. Every modern nation is now led by somebody who has a good grasp of economics and can tell when he is being deceived by his Ministers.
Will Nigeria soon be able to export 2.2 million barrels a day? That is the next urgent question. The answer is “definitely no”. Again, let us look at the evidence which the President’s economic advisers ignore at our peril. The United States which was once our biggest customer now imports far less than it used to do. Instead, it has become a net-exporter of crude and is now taking our market share. Already, the US has successfully taken some customers from us in India and South Korea. The trend in exports to India, which until this year was our largest buyer, should scare the living day lights out of all of us. In January it was 14.61m barrels; 11.64m in February; 12.63 in March; 12.49m in April and then 7.69m in May. It has remained down since then. Indian refineries have stepped up their purchases of crude from the USA in the effort to diversify their supply sources and to please President Trump who looks closely at the balance of trade between the US and every major country in promotion of his “America first” policy.
South Korea, threatened by North Korea knows there is only one ally which can offer protection. So, it is not surprising that the S/Koreans have re-discovered the virtues of diversification. They slashed imports from Nigeria and directed them to the US. Some other countries in Europe and Asia are also shifting from Nigerian crude to US oil.
The obvious question is: who is taking up what the big hitters are refusing? The answer is: nobody. As you are reading this, Buhari’s dreamers are getting set to send the 2018 budget to the National Assembly basing it on 2.2 million barrels a day. Buhari will approve it without question. Nigeria will not generate the revenue — without question. Every expectation based on next year’s budget will again be dashed. Just in case you think that is mere doomsday prediction, consider these two facts and prepare for the worst.
First, a recent study published on foreign direct investment in Africa indicates that no investor is contemplating making new investment in Nigeria in 2018. The “Giant of Africa” will get nothing; midgets like Botswana will receive dollars. Second, all the car manufacturers in the world are now exhibiting e-cars. Those are vehicles running on electric power not on petrol. Some already cruise the roads of Europe and the US. More will join by next year. The Age of Oil is over. But, Buhari’s government is not aware.
We need a President who can chart a new course for our economy; one who understands the trend because a future based on oil is bleak.