Atiku Abubakar. |
Before
the novel coronavirus pandemic hit the globe, Nigeria spent 42% of her earnings
on debt servicing. We have arrived at a new reality today: even if we devote
100% of our income to rebuilding our economy, it still will not be
enough.
COVID19 has wreaked
such damage to the world’s economy, and this is now very evident in the West.
But we should not take solace in any false sense of security that nations like
Nigeria are either immune to the vagaries of this plague or that we would not
be as hard hit. The reason countries in the Western Hemisphere are reporting
more significant numbers than developing nations is primarily due to the
availability of testing and real-time information.
Ignorance is not
bliss in this instance. We shall soon know the truth and, sadly, this truth
will not set us free. It will shock us. Had we closed our ports of entry early,
we would probably have had better reasons to be hopeful. However, the past is
gone, but we must be proactive in going forward.
I hate to be the
bearer of bad news, but Nigeria and other African nations are yet to see the
worst of the effects of this scourge. That is why we should unite together and
seek debt forgiveness, as a direct consequence of the impact of this pandemic
on our economies.
And we have a
perfect case because almost every African nation with a COVID19 infestation had
an index case that originated outside the continent. Nigeria’s index case was
Italian, Liberia’s was Swiss. Ethiopia had a Japanese index. South Africa’s
index case was South African, but he and his family got infected in
Italy.
This crisis
should force a commonality of purpose in Africa. And more so in Nigeria. This
is beyond politics. Beyond religion. Beyond region. And beyond ethnicity. As
crisis go, this one can be described as existential.
While
it is true that in a situation like this, the international community should
invest in all countries needing help, we must be mature enough to see that that
is not going to happen. The only thing that is standing in the way of the
coronavirus in Africa is ourselves. And we should not give in to panic by the
doomsday scenarios being painted by analysts. They mean well, but if they only
shout fire in a crowded theatre, all that their good intentions will cause is
widespread panic.
We must remember
that many of them had predicted that Nigeria would cease to exist as a
corporate entity by 2015, but here we are.
We had the Wild Ebola
Virus, and we defeated it because we did not panic. We must apply that same
level-headedness to this crisis. But this does not mean that we should go to
the other extreme and become overly optimistic or pollyannaish.
Even when we are able
to avoid a high human toll from this virus, we would not be able to escape a
much higher economic toll. We may have a recession. The challenge right now
must be to mitigate it, since we cannot avoid it. Already, we see forced
currency devaluations from the Cape to Cairo. These will no doubt lead to
internal inflation, which will spell trouble for nations like Nigeria, that
have a high external dollar debt burden.
Already, the United
Nations Economic Commission for Africa is projecting that Africa’s growth will
at least drop to 1.8%, and maybe more. Bear in mind that, thanks to nations
like Rwanda, Ethiopia and Tanzania, we had been projected to grow 3.2% this
year.
Faced with this crisis,
Africa cannot even think of falling back on China, or the West. When a country
like the US is struggling to supply its own healthcare workers with personal
protective equipment, Africa will not feature high on its priority. Where China
is wondering how to explain itself to the world when this dies down, our challenges
will be far from their minds. We must fall back on ourselves, or we will fall
headlong. We must take responsibility for navigating our way out of a challenge
that was forced on us from outside the continent.
This is the time for
every money made in Africa to stay in Africa. We have hospitals to build. We
have economies to reboot. We have citizens to care for and return to work. We
certainly should not be sending money out of Africa and into Asia and the West.
Not now and not for the foreseeable future.
Oil prices have
crashed, and that by itself should not be enough to trigger a crisis. After
all, the current price of oil was lower than it is today when President
Obasanjo and I assumed office on May 29, 1999. Yet we paid off Nigeria’s entire
foreign debt.
However, there are two remarkable differences. The first is
that we had a stellar cabinet between 1999-2007. We had the right people
manning our economy. We certainly would not have proposed to take out a $500
million loan to digitalise the Nigerian Television Authority, or devoted ₦37
billion to renovating the National Assembly complex (which was built from the
scratch at less than 20% of that amount).
Today’s Nigerian
government is severely lacking in qualified hands. And nothing proves this than
the state of the Presidency itself. To think that after devoting ₦13 billion to
the State House Clinic in the last five years, it is virtually useless as we
face the most significant public health challenge of our national life. That is
a pointer to the state of our federal government.
The second and perhaps
more important thing is that we did not have to deal with a worldwide pandemic
of this extent (although we had the H5N1 incident).
As it stands today, the
world is too preoccupied with its challenges to prioritise Africa, and so we
have to prioritise ourselves. The issue of Nigeria wanting to borrow $6.9
billion at this time shows the almost delusory state of our government. No one
has that type of money to throw about.
China and America,
previously our two largest creditors, have taken hits to their economies to the
tune of trillions of dollars. If they could, they would consider taking from us
at this stage.
Why is it that the
Nigerian government is always quick to want to borrow at every instance? It
shows a lazy mindset and an inability to take those sacrifices necessary to get
the economy into shape. Worse still it proves that we do not, as of yet, have
the ability to think outside the box for genuine solutions. We cannot be
looking to borrow huge sums at the same time our officials are taking delivery
of foreign made luxury cars. We cannot be considered a serious country when we
refuse to cut down on profligacy and instead seek outside help to fund our
inefficiencies.
Even in our own individual
houses, when things get tight, the first thing we should do is cut down on
unnecessary expenditure and then you look for creative ways to generate funds
and develop our household economy, before we even seek outside funding. A
situation where the Nigerian government always seeks outside funding, which, by
the way has to be repaid if ever granted, displays an inadequacy in the
thinking process of our leaders at the moment.
So, other than asking
for debt relief, what can we realistically do to protect ourselves from the
type of economic collapse that could lead to social upheaval in Nigeria?
We can start from where
we have the most influence, the global oil industry. To save our economy,
Nigeria must engage in immediate shuttle diplomacy to get Saudi Arabia and
Russia to settle their differences and end the price war that is affecting the
price of oil almost as much as the pandemic.
The Organization of
Petroleum Exporting Countries (OPEC) cartel is more vulnerable than Russia
right now. Yes, Russia is also vulnerable, but so are we. Russia has an almost
stable gas market in Europe. We do not. So we are much more vulnerable. This
price war is not just affecting Nigeria and Angola badly, it is also affecting
the valuation of ARAMCO and delaying vital decisions, which are troubling
signs.
Nigeria must bring her
weight (like we had done in the past) to bear to force an early cessation of
hostilities so that oil prices could start looking up.
And secondly, we must
insist that the Abacha loots held back by various Western governments must be
immediately and unconditionally returned to Nigeria. We have a humanitarian
crisis on our hands. I believe that President Trump is a reasonable man. He
knows that if nothing is done to avoid the foreseeable dislocation of African
economies, the next wave of mass migration to the United States would not be
from Mexico.
The worst thing we can
do now is to wring our hands and look to outsiders. Not now. The leadership in
Abuja and the rest of Africa cannot afford to be lethargic while the rest of
the world is scrambling to save what they can of their economies.
In Nigeria, it is
already clear that we must abandon the 2020 budget and come up with a more
realistic budget. Our oil benchmark is way off the mark. And we are certainly
no longer in a position to budget ₦100 billion plus for our legislatures and
almost ₦50 billion for the Presidency (in truth, we were never in a position to
do that).
Other African nations
must likewise re-budget and reassign and reduce expenditure. We can not spend
on luxuries when our necessities have exploded.
We are at a crossroads,
and we need to think and act our way into taking the right road. History will
forgive us if we make the wrong decisions, but it certainly will not forgive us
if we take no decisions in the misguided belief that others will save us. If
Nigeria does not save herself in this season of a global emergency, we may find
that a new world order will emerge and we will no longer be the Giant of
Africa. We may not even be the Giant of West Africa if we do not take decisive
action immediately.
Atiku Abubakar is a former Vice President of Nigeria
and presidential candidate of the Peoples Democratic Party (PDP) in the 2019
presidential election.
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