By Simon Kolawole
You campaign in poetry. You govern in prose. Former governor of New York, Mario Matthew Cuomo, now of blessed memory, said those immortal words 35 years ago. Poetry is relatively short and flowery; prose is much longer and less flowery. Yoruba would render the same thing Cuomo said as “enu dun r’ofo” i.e. “it always looks easy to make a delicious meal with words of mouth”. Anyone can talk a good game. When the All Progressives Congress (APC) was seeking to displace the Peoples Democratic Party (PDP) from Aso Rock Villa in 2015, poetry was the easiest part of the job. Five years on and the prose is damning. They are doing what they used to pummel the PDP for.
This year alone, we have witnessed what would otherwise be abominations to President Muhammadu Buhari: devaluation of the naira, increase in fuel price and a rise in electricity tariffs. VAT has gone up from 5 percent to 7.5 percent. Bank account holders are paying stamp duty for receiving deposits above certain amounts. Air travellers have been slammed with a 100 percent increase in passenger service charge while Abuja-Kaduna train fare has been doubled as well. In their previous lives, Buhari and the APC would have led street protests against the PDP about the soaring cost of living. It seems the reality has finally dawned on Buhari that bitter pills are inevitable.
Many Nigerians have actually come to accept that the country is not really rich as assumed and tough economic measures have to be taken to save us from total collapse. This is not a very popular opinion, certainly, but the economic experts are not opposed to the shock therapy. In fact, the few I have spoken with are praising Buhari for finally taking the hard decisions after five years in office. They think that if previous governments had chosen this path, we would have suffered the pains and be enjoying the gains by now. They believe the funds burnt on fuel subsidies, probably six trillion naira in the last 10 years, could have been better spent on roads, education and healthcare.
Mr Mustafa Chike-Obi, former MD of Asset Management Company of Nigeria (AMCON) who is not known to be a fan of Buhari, tweeted: “The gradual dismantling of subsidies by the Buhari Administration is well advised. It was unsustainable, and this policy adjustment though late in coming is the proper economic decision. We must not oppose good policies in the name of political opposition.” Mr Atedo Peterside, also a known critic of Buhari’s economic policies, only said the federal government “should get out of the business of making pronouncements on the price of petrol”. You are not likely to hear any liberal economist oppose the shock therapy.
Nevertheless, there are no easy ways out of this economic mess that we have found ourselves. Even before the devastation brought by COVID-19, we were struggling. We have relied on oil revenue for too long; shifting attention to the productive bases of the economy — particularly agriculture and industry — is never going to yield results overnight. It takes time. We need policy consistency and massive private investment for us to attain a comfortable level in the non-oil sector in the long term. We rely too much on crude oil to fund our budgets. COVID-19 has now thrown the economy into its worst state since 2016. Something just has to give — and adjustment pains are inevitable.
Definitely, the ordinary people will feel the pains of these reforms the most. Transport costs will go up. While electricity tariffs were not increased in residential areas classified as low income, prices of goods and services will certainly go up as a result of the affected sectors, and the masses will feel the heat. Food costs will go up. All these are inescapable. We cannot leave the vulnerable Nigerians in the lurch and think there would be no consequences. Conversely, the political elite would continue to enjoy the good of the land. Their privileges are always unaffected. That makes it very difficult to preach sacrifice to the people and assure them that there is light at the end of the tunnel.
Indeed, Nigerians have heard all that before. Buhari’s shock therapy is, thus, not the ultimate solution. We need fiscal discipline at all levels of government. We need accountability. We need transparency. We need prudence. Government needs to trim fat. While retrenchment is not an option at this time, at least certain excesses on the expenditure side can be scaled down. The pains of reforms would only be worth it if Nigerians begin to see good roads, decent hospitals, better education and higher standards of living in the years ahead. Unfortunately, Nigerians have heard unfulfilled promises for so long that they have developed immunity against hope.
Still, government needs to market reforms to the people in a better way and not assume that because Nigerians have been showing understanding and patience all along, there is nothing to worry about any more. You don’t implement these tough economic decisions without first trying to build support. What are the palliatives to protect the poor? What is the level of engagement with the opposition? It appears the government has become complacent in this aspect. It seems the assumption is that Nigerians will take the changes without resistance. Indeed, the debate in the wake of the latest increase in fuel prices is why people are not protesting.
Many commentators have been asking why Nigerians are not kicking against the “shock therapy” — a term used to describe a series of tough economic reforms suddenly introduced by a government particularly at a time of hardship or disasters. The most common suggestion is that those who organised the protests against previous governments are now in power and can, therefore, not organise or encourage protests against themselves. But it is not accurate to say those who organised the previous protests are now in government; some are actually outside government and are still very active in the civil society movements. Maybe they are not convinced there is a need for aluta.
Or could it be that Nigerians themselves have lost the will to protest? Could it be that people are more concerned now about how to eke out a living than going on the streets and singing solidarity songs? I am not really convinced by this argument. I do not think anything has changed fundamentally about the attitude of Nigerians to the withdrawal of subsidies. The first response is always resistance to subsidy cuts. I think people still want cheaper fuel and cheaper electricity. I don’t think anything has changed about what Nigerians want. Maybe we are now so divided— along political, ethnic and religious lines — that finding a common mobilising force is harder. I can’t know.
Maybe there is something else. In my life so far, particularly since I started going to the bathroom by myself, I would say only twice have I witnessed an increase in fuel price that did not elicit street protests and strikes. The first was in January 1986 when Gen Ibrahim Babangida announced an increase in the prices of petroleum products. That was his first budget as military president. I remember he also created a national emergency fund (not sure that was the name) in which civil servants were asked to contribute a part of their salaries. It was their “patriotic” contribution to save the economy which was in dire straits then as a result of low oil prices and foreign exchange crunch.
The second instance was when Buhari raised petrol price in May 2016. It was a significant leap from N87 per litre to N145. There were no protests, beyond media articles. The economy was down in any case. People were wondering why there were no protests and my instinct then was that Buhari was enjoying a prolonged honeymoon. Or, perhaps, Nigerians trusted him more with the management of the nation’s resources. He was seen as an honest man who would not steal or enrich himself. Some said if he increased fuel price, then it must be in the interest of the country, not because he was going to derive any personal benefit from it. The goodwill was there, I would say.
It is also possible that most Nigerians have bought into the logic of deregulation. I can’t say. Many may have come to see that they actually pay more for self-generated electricity, in addition to suffering the noise pollution. So maybe those ones have no appetite for protest. Whatever the situation is, there are some facts we cannot dispute: our finances are in a bad place. Oil revenues are badly hit. We keep borrowing. We are spending our little revenue on servicing debts. And the reality too cannot be disputed: the load will disproportionately be on the heads of poor Nigerians. What will the government do about this? We need a clear statement and a re-assuring palliative plan.
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