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•Nothing wrong with coastal road, but we should have railways across Nigeria
A former Minister of Finance, Dr Kalu Idika Kalu, has reviewed the recent World Bank report that says 139 million Nigerians live in extreme poverty, noting that the damning report should be a wakeup call for the government to sit up.
In an interview with Saturday Sun the former presidential candidate of New Nigeria Peoples Party (NNPP) in 2003, also stated that there is nothing wrong with having coastal roads, even as he noted that the country should have a huge network of rails serving the people across the country.
He spoke with VINCENT KALU.
The latest World Bank report says that about 139 million Nigerians live in extreme poverty. What’s your view on this?
I always emphasise, you can get a condition in which it is utterly futile to be dwelling on fractions and percentages and so on. What’s our population? We are not even sure of it. Okay, let’s say its 220 million people. You can easily check what proportion of our population is in that extreme poverty. But as I said, with the grossness of our deficiencies – reliable clean water, reliable power, roads, bridges, housing, health, education, you can count about 12 major indicators.
We don’t need to get hung up on percentages, even grossly rounded up to millions; it’s enough for us to feel the weight of what we lack. About 139 million is over 60 per cent. But that is the level you find in some of these developing countries.
Where it is sad and doubly sad is that this is a country that has been wealthy from inception – people, land, agricultural products, exportable products, you can count up to 20 or 30 if you look at our trade statistics. We have hundreds on our list.
On agriculture, we are not talking about processed agriculture. We should be producing secondary industry from agriculture. I’m talking about agriculture as just one of the primary areas of production. You go to mining – tin, columbite, gold, zinc, lithium, tungsten, name it. All that time we were talking about those ones, we didn’t realise the quantum of other strategic minerals that we’ve had. As we now know, helicopters are flying in and out by night carting away precious strategic resources used in finite quantities in the computer industry, in aircraft manufacturing, and all sorts of things. As if that is not enough, from the late 50s, we’ve been major producers of oil and gas, and then we went into liquefied natural gas.
Should we still be talking about not having water, power, and basic health? In fact, we had some of these things under colonial system.
I know in my own place, we had clinics, where our people used to go when they were ill. Everything seemed to have been available. We are talking about 60 or more years ago. Let’s not belabour this thing. The point I’m making is that for us to be quibbling whether it’s 139 million people or 100 million people, etc, is serious. Every government will want to say something, but there’s a way we should say it for us to acknowledge that even if it is 50 percent of the number quoted, that’s serious enough given the wealth of resources we’ve had for over 100 years in this country.
But the federal government has disagreed with the World Bank report…
I’m not going to be lampooning the federal government or any state government, but I’ve made my point that whoever starts to quibble about that should realise that even if it is only half, it’s bad enough.
In arriving at the statistics, what were the considerations by the World Bank?
The World Bank works in all the member countries, they don’t only work in Africa or Nigeria. They work in all countries; they have statisticians, who are professionals. When I had my PhD, somebody came by chance and saw my PhD, which was on tariffs and non-tariffs, the stuff that the current American president is making such a long song and dance about. They have professionals; it’s not for us here to be asking how did they come about that? They have statisticians, they have demographers, and they have professionals in various areas.
That’s not the issue, and that’s why I said even if it is 50 million people, it is serious enough. We should concentrate on the efficiency that we ourselves should tell what we have before the World Bank. Of course, this is their job. As members, we pay dues, we pay the subscription, we pay for those studies, we pay for the annual reports, and we pay for all these things.
Our people also do these estimates for other countries – Kenya, Ivory Coast, Morocco, Turkey, etc. Nigerians are involved with the World Bank and the International Monetary Fund (IMF). The IMF is more with financial statistics. It is a little bit out of tune for us to be questioning how they came about it. They send people who come here for detailed studies; they go to the rural areas, get statistics, etc.
At this age, 65 years after independence, those are hardly the questions that we should be asking. It’s like asking how our own National Bureau of Statistics comes about with its own estimates of inflation and population growth and other vital statistics. These are standard practices; there are standard procedures. We are a mature country, and at this time, we should be moving into part two. We should be moving to the part two like the Koreans, who don’t have oil or gas, and have moved into part two, and now contributing to give money for the development of other countries. This is where we should be moving, not quibbling over whether 139 million people or more, or they want to demarcate the government. We should be the ones helping our neighbours. We were getting there and then we slid back. As a youth, my dad used to tell me and I read some of that myself when we sent lawyers to defend the Mau Mau in Kenya in the 50s, we defended South Africa. This is the major country in Africa; this is the major Black Country in the world, we should not be at a station where we are quibbling about some outfits which will belong; we are member, we are on the Board; we are part and parcel of these financial institutions.
Across the country, all the federal roads seem to have collapsed, but the government is always busy talking about the coastal road. How can you juxtapose the two; you cannot fix existing ones, but you are building another one?
Government has to decide its priorities, even though we may have doubts about the priorities. But, we don’t have enough roads, and nobody can put over the fact that there’s no need building a road when you do sustain the roads. We don’t need two sentences there, it’s obvious. The joy of travelling on the federal roads; the federal roads that were built to go from Enugu to Umuahia to Aba to Port Harcourt, we should have doubled that by now, the same quality I used to drive when I came back from the US. I used to drive my Volvo car down those roads, it was beautiful. We should have had more of those things. I’m talking about coastal roads. One of the first considerations should have been the railways we proposed under the Federal Mass Transit programme several years ago.
I’ve had the occasion to repeat this over and over, Nigeria should be served by a whole network of trains; it serves so many purposes. It brings millions of Nigerians together to know each other, which reduces social tension, and improves political activity that improves development at the grassroots. A rail from south to the north – maybe two or three of them – one going as we proposed then, from Lagos all the way to all the cities to Abuja, pass through all those areas they are kidnapping people through Benue down to Plateau down to the South-East, and another line going the same way from Lagos all the way through all the states of the south and passing through all the major commercial centres and the capitals. That’s what Nigeria should have had by now.
When you were Minister of Transport, when you came up with the idea of the railway programme, what truncated it and how could it have been funded?
Nothing truncated it. It was never started. There were other programmes. This is all looking down the lane now. It was not done. But, part of it was that there was not really a clear understanding of the context. And this is why it is important when you put people in charge of these things, you put people who have a track record because then you can rely on the suggestions that they bring to bear.
I’m not saying this because I was the minister. That goes for everything, whether it is health, education or any other field, we should bring Nigerians from all over the country. By now, all these ethnic cleavages should be behind us because this knowledge is not residing in any particular group or in any particular region. Nigerians have proven that they can do it. So we have to get Nigerians from every area to come. And it’s when they come on with this solution, we’ll implement.
Like people have been shouting, this government is borrowing, and borrowing. I say, the problem is not borrowing. The problem is first and foremost, identifying the projects. That’s why you have a cabinet, they sit down, they are from different parts, and they identify the needs of the area. When the government achieves it, the praise goes to the leadership and to the cabinet. It is not for a minister to say he attracted this to his own area when he was there. That kind of very selfish view of development strategy is very wrong and we are going on it.
The cabinet reviews the general needs of the constituencies, whether it is a local government or the state or of course for the general public.
The idea of that mass transit was – coastal shipping, railways and then of long range buses to move passengers in bulk, to move produce so that you can have fresh fruits from some remote village to the urban and capital cities. That project was to be handled by the same people that build trains, even in America, funded very cheaply, equitably. So, going back again, the issue should never be borrowing, borrowing, borrowing.
Before that borrowing, there would have been a proper appraisal at the grassroots of the needs – roads, bridges, rails, and factories, whatever it is. And for a country with the resource base of Nigeria, the last issue that it should be talking about is not whether we can fund it or not, because we have enough funds to be able to leverage upon to the totality of the investment required.
In other words, if you have 50 per cent, sure, if it’s a viable project, you mobilise the rest. You have the ADB and the World Bank and the IMF and the European banks and others, and then you, of course, talk about the bilateral institutions and then, the private sector.
By the time you put up your budget properly, you find that you can fund this thing, and it will be implemented to the letter. But when we are spending so much time talking about all kinds of under-the-table deals, that’s why those things don’t get done.
Let’s call a spade a spade. If we can’t do it 65 years after independence, when are we going to be doing it? Obfuscating the facts, I’m talking in parables. There’s no more time for parables. It’s time to face the facts of why we are where we are, and talking about 139 million,100million or 120 million people living in extreme poverty.
As I said earlier, even if it’s 50 million people, it’s not right for a country of this size with the resources we have. So, let’s not spend time as to how did they do it? It’s a non-productive enterprise. The figure, whether it’s 50 million people or 100 million or 150 million or whatever, it is something that is not quite proper, given our history and our resource base and all the access we have.
What’s your view on the agitation for fiscal federalism, whereby federating units or states control their resources?
By this time, all these fiscal arrangement should be on the sideline. It is a natural because of the structure of the country. In retrospect, it started because we didn’t realise that as we should know by now that every state has its own resources, it was not just the groundnuts, cocoa, columbite, tungsten, tin and coal. What we had particularly with the emergence of oil and gas was that it was coming from one part of the country, but now oil is there in many other parts of the country.
So, my position is very simple, while we had it, it will always be complemented by local resources – locally generated revenues too. It’s been in every country that has federal situation. You go to Australia, half of the place is desert, but they had minerals throughout all the coasts in the south, in the northeast, in the north of Australia. You go to other countries you see it in Latin America and so on. They have these arrangements because the people are one. If the people are one, you are not going to be saying if you don’t have the gold in your area you should not benefit from gold. First of all, there should be free movement of labour, if you don’t have anything in your area you move to where the jobs are available – the plantations, – the minefields and so on.
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For Nigeria, 65 years later, we should be able to sit together and talk about it. We should not say no, no, we don’t want to discuss it; we don’t want to discuss constitution, we don’t want to do this thing. As long as people are concerned about these things, we should sit and discuss it. Fiscal arrangements are the same; everything has to do with everything else. What do I mean by that? If there’s proper representation, if there is proper allocation of seats – whether it’s the state assembly or federal assembly, once those accredited representatives of the people say we need to discuss this, we need to modify this, nobody should come and say no, no, we can’t discuss it. This is sovereignty of the people. By the same fact, people once in a while – five years, 10 years, or 15 years, can say, oh let’s sit down and review this fiscal formula, that should be a foregone thing; you go and discuss it.
Do you want to shift more to the local government, who should the resources go at the local government? Do you have a responsible representation at a local government, or those who meet to share? These are serious things and no serious nation should be content with something being said that has elements of truth.
The local government should have these resources to open up access roads, farm roads, make sure there are other social initiatives at that local level, the same should be at the state, and not to mention the federal. Fiscal federalism is an important subject, but it should be in context. By now, each of these states should have basic industries, basic agricultural projects, and basic refining projects.
Already, all over, that’s why some of these countries have an income of $8,000, $10,000, and $15,000, etc. Not where we just meet and share things. As we were saying earlier, we can’t even maintain the roads, we can’t maintain the schools, we can’t maintain the clinics, we can’t build public housing, and to make sure that every regime that comes builds houses. This is how to recognise the growth of the population, the growth of family, households, and so on.
They should build housing. This is how you dilute the cost of housing. So, it’s not left to the private sector to just build and charge whatever they have. When they know that the public is also contributing, either you go for public housing or you go to private housing.
In effect, are you suggesting a situation where federating units –states control whatever that is in their domains?
We didn’t discuss control yet. It is subject to discussion. As long as you are a united people, that’s why you have social safety net, that’s why you have people who cannot walk because they have infirmities, that’s how you have old people who when they retire they need help.
You can’t just say, everybody control your own. How do you meet all those social needs? There must always be room to discuss functions to meet the needs of people. A state, a government is responsible for the happiness for those who have minerals in their areas or those who don’t have. There is a system of taxation to make sure you withdraw to fund those things. So, if you say control, then you have to take into account the structure of the tax structure of mobilising to meet the needs of the general population. Fiscal federalism doesn’t mean that you control 100 per cent.
But in the First Republic, 50 per cent went to the producing region, 30 per cent to the centre, while 20 per cent went to an account to tackle projects that the regions couldn’t handle alone?
That’s what we are talking about, precisely. It should be subjected to periodic reviews and discussions for a viable state. It was wrong for it to be overturned by the military. It was just grabbing. It should never have just gone like that.
Fiscal federalism is that in a federation, you share common resources, and there is derivation. How much do you allocate to derivation? How much do you allocate to the general pool? This is what should be subject to periodic review.
The responsibility of government is for everybody, including those who live in swamps where nothing works. And of course, by the time you know it, you realise the swamps even have mineral, isn’t that what has happened?
The very swamps we were talking about is Niger Delta, they’ve had the oil and gas.
Where is our own Dubai in the Niger Delta? When I headed the refinery study, I said that should be our purpose; we should be trying to build the Dubai. Where is it? Brackish water, fishes dead, pollution everywhere. No housing, no education, no roads, no infrastructure and no communications. Why must we get to that before we think that’s what needed to be done? Why must we get to that?
Look at Dubai, look at UAE. They are now at the limits of artificial intelligence – fantastic hotels, fantastic Riviera, whatever. Their own building must cost more than what we would have used to build ours. We are not even talking about all those things.
Look at the Niger Delta. Where is the transport network? You see canoes and speed boats that are still all imported when they should have been produced here. At least for the most parts, just as we are assembling. We should have been assembling most of it, maybe just an engine; it will also be an industry.
What are the educational institutions? Where are the modern fishing companies?
So, we have lagged behind in all this. In this day and age, we should not even be talking anymore. It’s not the time for paper coating our deficiencies, and coming to ask a special question. How do you get 139 million poor people? We should be ashamed enough that we are talking millions for a country that’s had so much resource. We should be ashamed to even be asking the question.
What message do you have for Nigeria at 65?
The only good thing is that I’m not pessimistic. I think that’s what the president was saying that we should not be pessimistic. And as I said in my interview with Arise Television, we should not be pessimistic. Look at what Nigerians are doing abroad, and they are still moving out. Why should we be pessimistic? Our youths seem to be doing well with the new technology, but we should organise them.
Instead of getting depressed, you should put it positively, and get the school working, get the transport to link up to farms to bring in produce to reduce the weight of spoilage after production, spread the produce from the point of production to the farthest corners of the country; fresh foods from north to south, from south to north, from east to west, and west to east that’s where our indignation should show up in positive ways to improve the situation, not in querying the IMF and the World Bank reports. As I said, when we talk like that, we forget that Nigerians are there in the World Bank, Nigerians are there.
For those of us who worked there, countries that are still whining about IMF and World Bank must be the ones that don’t even know what’s happening because they don’t know their own people are involved in working in other countries. As far back as in the 60s and 70s, or even 50s, they’ve been directors.
I was there and Ngozi came immediately after me, there were others who went there before us, but we keep talking, and every time we want to blame the World Bank. The institution always applauds when a country moves from part one to part two, where they are not just developing, they are now contributing to fund other developing countries. This is the standard they use at the World Bank at the IMF, you move from a part one country to a part two country; you have grown and will be celebrated, but here we just get the idea that somehow they are there to sell you rotten lemons. That defines also the state of knowledge in the particular country, when that kind of thing is still in their conventional wisdom that the World Bank just comes to criticise. They are there to help you. That’s what it is; it’s not a matter of being radical. Some of these radicals don’t understand what they are talking about.
The federal government, the states and the local councils are getting so much money, but people are complaining of hardship and hunger. What is your take on this?
The phrase is money illusion; paper money is different from more maize and coconuts and yams. The Naira you are talking about today is probably one-third of the Naira you were talking about yesterday. I’m just using yesterday; it could be three years ago, four years ago.
So, the fact that we are talking about trillion Naira now is so much money, but by the time you adjust for price changes, exchange rate changes, you find that what you have now is less than what you had three years ago.
I’ve said this over and over, it is money illusion. So, let’s stop saying the government has so much money. That money is just because of price change and exchange rate depreciation.
Whichever way you can put it for people to understand; you better do, because everyone is tired of answering the same question all the time.
When there are other supply constraints, the money is not as much as what it was last year or the year before. So, it’s just exchange rate issue. That’s why you should let your exchange rate stay as much in the price, not because IMF or World Bank said it or some economist said it.
The market women can explain what I’m explaining very concretely. You take N100, 000 to the market now, you buy less than what N10, 000, would have bought you three years ago. That’s what we’re talking about.
The same vegetables, meat, Ogbono and yams, etc, when you now use all this money to go and buy them, you get less than what you used to get before.
So, let’s stop thinking that government has so much money. They know better because they are budgeting and spending. You have to budget now to adjust for the price increase to even get the same thing they were doing for the previous budget. That increase in money illusion does not create additional yams or rice. You have to work at it and bring back the quantum of production to beef up the volume of money. Then that money will be getting more meaningful because of productivity increases. It’s not the big money that really creates additional bags of rice or flour or whatever. Nigerians will say, oh, they have all these trillions really on their budget, but they have less than the previous hundreds of thousands they had some years ago.
The same accommodation you were paying for, look at what you have to pay for it now. The only way the money can increase is if you build more houses, create more quantity, and then the price will have more meaning. But, if you don’t create more quantity, but you say you have more money, it’s just the same accommodation but you will be paying three or more times as the years go by.
