Cost of governance: It’s better we return to parliamentary system –Senator Kaka
By Omoniyi Salaudeen
Senator Gbenga Kaka, a former deputy governor of Ogun State, represented Ogun East Senatorial District between 2011 and 2015.
In this interview, he examined the challenges facing the Nigerian economy, especially the worsening food crisis and what the government needs to do to change the narrative.
The food crisis facing Nigeria is not abating. Could this be the result of weather condition or a lack of incentive to farmers?
It is all of the above. Weather played a major role in agricultural ventures. In the Southern part here, there was no adequate rain for the early planting season. And as you know, we are short of irrigation facilities. Also, the inputs such as fertilizer, seeds, and seedlings are just being released. While these may be beneficial to the Northern farmers, the planting season in the Southern part is almost over. That means the inputs they have just released are of little or no essence to those of us in this part of the country. Again, when we look into the role of middlemen under this economic condition, the story becomes more pathetic. The middlemen take pleasure in hoarding and making exorbitant profits at the expense of the common man, which is rather unfortunate. So, more often, the available food items are mopped up, warehoused, and later released when the price goes up. We have had cases of loads of trailers intercepted on their way to the West African sub-region. All we need to do is produce more to achieve food self-sufficiency. At present, we find it difficult to achieve equilibrium in the economy. And the exchange rate is not helping matters. As we are now, the economy has defied the simple economic theory of demand and supply equilibrium. We need to find the equilibrium within the economy.
The middlemen have always been in the system. Why is it now that the negative role they are playing in the economy is creating such a huge dislocation?
It is because we have not had a troubled economy like this before. Under the present circumstance, we have subsidy removal; we have increasing exchange rates and security challenges. All of these are responsible for the instability in the economy. Until we can reach a balance where the supply and demand sides are equal, the price will continue to skyrocket. The government is doing its best to address the situation. However, the effort must be directed at a quick resolution of the imbalance we are currently grappling with in the economy. We need to produce more to achieve a balance between demand and supply.
Fuel subsidy removal is biting harder and the government has also not found a solution to the exchange rate fluctuation. What then is the way out of the lingering food crisis?
The simple answer is we must work harder, we must produce more and we must improve on our productivity. If we don’t produce enough food and raw materials to run our industry through value addition, there is no way out of the present situation. No shortcut. Let anybody blame the government till next year, it won’t solve the problem. The government should not throw money at our problems. They should channel money toward productive courses. When you talk of agriculture, we have arable land, we have a pull of water; so, the government can help the system by channeling the pull of water through irrigational facilities to our lands and encouraging people to go back to farm by ensuring adequate security of lives and property. We know the attacks going on in various parts of the country; it is not the fault of this government. But if they can take care of all these and encourage people to return to the farm, we will be able to produce more to feed ourselves.
It is worrisome that many multinational companies are leaving Nigeria in their numbers. How can the government stem the tide and stabilise the economy?
All industrial ventures that are relocating, we don’t need to pursue them. If our environment is conducive and we have favourable exchange rate, they will naturally find their way back to the country. They’re not here as Father Christmas, they are here to make profits. If we don’t provide a conducive atmosphere, they will continue to migrate out of our economy. You can’t expect them to remain here when they are not making profits. That will be a tall dream. They will be here to milk us dry because I know what is going on. It will surprise you to know that those who are remaining are not using their monies as capital. They are using money derived from Nigeria to do business. And I have evidence to show. If you pay money for a product here, the parent country has to confirm that they have received the money before they give the signal for the product to be released to us here in Nigeria. In those good old days, multinationals were physically present with us with human resources. But now, the real management is in the country of origin. They even import foreigners to head their companies here in Nigeria. They do everything to squeeze us and even kill our local industries because they are very aggressive. Unfortunately, we have collaborators within us. The government has to do everything possible to make our local industries competitive or else we will have no choice, but to continue to import.
This speaks to the essence of the government spending hard-earned money on overseas trips in the name of looking for foreign investors. Isn’t that an effort in futility?
We are under the global influence. We are now in a digital economy where you can stay within the four corners of your room and be a part of what is going on in any part of the world. Do you need to junket around the world before you know that investment will be better in Dubai than in Ghana or your investment will be better in Singapore than in Nigeria? The simple basic economics is no longer applicable to us. If the environment is conducive and the bottom line is favourable, you don’t need to appeal to anybody to come and invest. They will naturally come. As I said earlier, other than environmental factors, we also have some criminals among us who are assisting foreigners to commit crimes against us and get away with it. We have to stay at home and find solutions to the economy.
What is your projection of the future of this country in terms of economic growth?
The future remains bright once we do the right thing. We can’t have our young men rotting away because they don’t see any reason for them to work and expect to grow the economy. A good number of them prefer to live on handouts because they see those who are being promoted as role models without genuine means of livelihood.
Can you say we are doing the right thing?
That question is for me and you. And it is for everybody. We are not doing the right thing. Go to the banks, they are ready to fund commodity business rather than industrial or agricultural ventures because they have longer gestation periods. Hardly can you find either of these two ventures that is less than three to five years. If you as a commodity businessman take a loan with 30 per cent interest, you can roll it over three or four times within a year. If you compare that with industrial or agricultural ventures amid the current inflationary trend and the unfavourable exchange rate, definitely you will be stuck in the middle of the road. Are we doing the right thing channeling hard-earned money to commodity business at the expense of industrial venture? Go and check, the bankers are making profits and smiling home. The more difficult the economy is the more some people take advantage of the sad situation.
Do you see the recapitalisation initiative of the Central Bank of Nigeria in this scenario as the right way to go?
I don’t know what benefit that will be to the economy. If the government cannot make interest rates favourable and liberalise loans to the core productive sector, then we are far away from the solution. If all we do is to channel money to commodity business, there is no way we can improve our production capacity. At present, our industries have collapsed. Apart from those that are leaving, others are just subsisting.
The bill seeking six-year single tenure of the rotational presidency is being debated at the National Assembly.
What is your perspective on this proposal?
If we like, we can go for a three-year or 10-year single term, it won’t change the character of our politicians. Patriotism is required to get us on the right track. We need to build trust between the electorate and the political players. If we don’t know where we are going, let’s retrace our steps to where we are coming from. It has been proved beyond reasonable doubt that the parliamentary system of government is cheaper and more accountable. If the expensive nature of our presidential system is what is compounding our problem, why don’t we change the system and go back to where we are coming from? As we have changed the national anthem, let’s go back to the old parliamentary constitution.
