Nigerian masses and the biting economy

By MICHAEL JEGEDE

THE economic difficulties as currently experienced in the country have continued to hit harder on the Nige­rians masses. This is obviously not the best of times for most Nigerians who struggle every day to keep body and soul together. The general mood of the masses at the moment is that of gloom, lamentation and resent­ment, as hunger seems to pervade everywhere in the country.

The Governor of Osun State, Rauf Aregbesola, re­cently told newsmen in Lagos that, “Even the civil war (between 1967 and 1970) was not as biting as what we are facing in Nigeria now. Because the government has not declared a state of emergency on the economy does not mean that Nigeria is not near to that.”

This statement by Aregbesola tends to explain the true situation we are faced with at the moment. It tells you that the pain Nigerians are passing through now is unimaginable.

Workers in most states of the federation are being owed for months, despite the bailout funds released to state governors by the Federal Government to clear the backlog of salaries. Only about nine states out of 36 are reportedly up to date in the payment of staff sala­ries. Allocations from the Federation Account to state governments have since reduced and the governors, as rightly observed by their colleague, Governor Ibikunle Amosun of Ogun State, are not thinking outside the box to find other means of generating money to run their respective states.

The prices of goods and services have skyrocketed without any increase in the income of workers, there­by leaving the citizens with lower purchasing power. The Consumer Price Index (CPI) measuring inflation in the Nigerian economy as at June 2016 rose to its highest point of 16.5 per cent since 2005, according to a report released by the National Bureau of Statistics (NBS). Some private organisations and industries in­cluding banks have resorted to mass sack to stay afloat in the midst of the dwindling economy, which has taken a heavy toll on business activities in the country.

In a vox pop done by Encomium Weekly to hear the voic­es of some members of the public on the biting economy, one Ramon Alabi said: “Even a mad man on the street is feeling the heat of the economic situation of the country right now. We keep hoping every day, but it seems the hope is not even near at all. I have chosen not to eat thrice again; I only eat two times in a day. But, if I could do that, will I ask my little children not to eat thrice, even more? This is the period that some men are losing their headships. Many families have been set apart because of the poor economic situation of the country. May God help us!”

The unusually high exchange rate, the sharp fall in oil prices at the international market together with the long-time endemic corruption in government circles as well as bad leadership and mismanagement of the country’s resources by our past leaders have all combined to put us in this economic quagmire that we find ourselves as a na­tion. And when we talk of corruption, bad leadership and mismanagement, it is not just in the 16 years of the govern­ment of Peoples Democratic Party (PDP).

The unfortunate truth is that since we attained inde­pendence in 1960, we have never had leaders that placed the interest of the country first. The major concern of our leaders has always been personal aggrandizement and self-enrichment.

Today, the Nigerian masses are the once bearing the brunt of the leadership failure that is largely responsible for the biting economy. Benjamin Franklin (January 17, 1706 – April 17, 1790), an author, political theorist and one of the founding fathers of the United States once said: “If you fail to plan, you are planning to fail!”

We are in this state of underdevelopment where majority of Nigerians are wallowing in abject poverty and starvation as a consequence of our failure to plan for the rainy days from the many thriving periods we have had in the coun­try’s economy since we joined the Organisation of Petro­leum Exporting Countries (OPEC) in 1971.

In a piece captioned “Nigeria and Oil: Looking Be­yond Price Collapse Towards Post Recovery Savings”, Austin Okere, Founder CWG Plc and Entrepreneur in Residence, Columbia Business School, New York, noted that “The recurrent mistake we keep making as a nation is failing to anticipate and plan for our oil windfalls… Oil prices increased by 400% in six short months after the Yom Kippur War following the Arab Oil embargo. Crude prices doubled from $14 in 1978 to $35 per barrel in 1981 following the Iran/Iraq war. The price of crude oil spiked in 1990 with the uncertainties associated with the Iraqi invasion of Kuwait and the ensuing Gulf War – the so called ‘Gulf War windfall’ under the then Head of State, Ibrahim Babangida.

Data from the U.S. Energy Information Administra­tion shows that the latest windfall happened between February 2011 and August 2014, under the Goodluck Jonathan presidency, when oil prices were much in excess of $100 per barrel. Another golden opportunity was squandered, characterised by organised kleptoc­racy of epic proportions as has now come to light.”

Continuing, Okere said, “During this same period Saudi Arabia has amassed a whopping $593b in for­eign exchange reserves and has recently announced that it is creating a $2 trillion mega-sovereign wealth fund, funded by sales of current petroleum industry assets, to prepare itself for an age when oil no longer dominates the global economy.

Coming closer home, Algeria, the second biggest African oil producer, with 1.9mbpd has accumulated foreign reserves of $156b and a sovereign wealth fund of $50b. Nigeria, by far the biggest oil producer in Af­rica with 2.5mbpd has only managed foreign reserves of $28b and a sovereign wealth fund of a paltry $2.9b – about 5% that of Algeria. The major difference be­ing that while the Algerians saved for a rainy day dur­ing the boom years, Nigeria was busy squandering her wealth, with nothing to show by way of infrastructure or any solid investments.”

n Jegede writes from Abuja