After decades of stagnation, the emergence of Muhammadu Buhari as President offers immense possibilities for Africa’s largest economy, writes Muhammad Nuradeen, Editor.
The Naira may have risen a notch higher from its all-time low a while ago, the stock markets are down but not completely out while foreign reserves has been depleted faster than ever.
The economy in the face of rebounding oil prices is wobbling while Dr Ngozi Okonjo-Iweala who loves to pride herself as Minister of Finance and Coordinating Minister of the Economy is confident that the economy is strong and that current challenges are short-lived.
But the reality Nigeria’s man of the moment and President-elect Muhammadu Buhari will face is certainly not through the prism of the bespectacled former World Bank Director.
This was aptly captured in the view of economists that the oil price in the international market will have to rise above $120 per barrel, up from its present $67 per barrel, for Nigeria to meet her fiscal responsibilities in the current budget.
Indeed the portents for the Buhari administration are benumbing, what with the jarring statistics haranguing the public space.
The Mo Ibrahim Index for Governance (IIAG) instituted by billionaire Mo Ibrahim to provide statistical measure of governance performance in African countries offers an interesting perspective.Nigeria ranked 41 out of 56 countries with a total point of 43.4. Nigeria would also need about 40,000MW of electricity to match its GDP, currently producing less than 5,000MW of electricity.
Quite instructive, the Human Development Index also places Nigeria in the 152th position on the global scale.
Furthermore, there is no let up for this successor-president who is inheriting an empty treasury- broken by falling oil prices, the cost of supporting the national currency as well as the stifling corruption by public officials on their way out of government after 16 years of opulent living.
Perhaps this stark reality was brought home to many Nigerians when Okonjo-Iweala unabashedly declared that the Nigerian government had borrowed a whopping N473billion to pay salaries and fund the 2015 budget.
The minister, who was speaking in Abuja on the details of the N4.493trillion appropriation already passed by the National Assembly, said the Federal Government had to raise its borrowing level from N570 billion to N882 billion to enable it meet its financial obligations to workers and contractors.
The minister blamed it on the decline in oil revenue in late 2014, which accounted for 50 per cent cut in the total federally collectible revenue as well as the low revenue receipts from non-oil sources.
Inpite of past efforts to reduce government borrowing level, she said the acute cash flow problems forced government to take the decision to curb the negative impact of revenue crunch.
The Minister said about N380billion came from external sources, while the balance is for domestic borrowing.
“We have tried to work within the budget,” she said. “Last year, the borrowing came down to about N570 billion. But, this year, because of the very difficult cash flow situation, we have provided N882billion in borrowing.
“About N380billion of that is external borrowing and the balance of N502 billion is for domestic borrowing. All we have borrowed so far is N473billion, which is within the budget.”
Curiously and contrary to recent reports that there was no provision in the budget for fuel subsidy, Okonjo-Iweala said the lawmakers actually made a provision in the budget for about N100 billion for petrol and another N45.52 billion for household kerosene fuel subsidy.
Although President Goodluck Jonathan is yet to sign the 2015 Appropriation Bill into law, Okonjo-Iweala said the expenditure so far made was legal, saying the constitution authorises the government to incur such expenses within the first six months of a fiscal year.
Coming at a time when the momentum of the war against the Insurgency in the North West Zone of the country has to be sustained, it is understandable that the outing of the president in the months after May 29 would not be a tea party.
Happily for the millions of Nigerians who had thronged the thousands of polling units across the country in defiance of the elements to sack a sitting president, Buhari may well be treading a familiar path.
After the sack of the rudderless Shehu Shagari administration, Buhari as military Head of State had presided when Nigeria was facing severe economic hardship.
He broke ties with the International Monetary Fund (IMF) when asked to devalue the Naira 60 percent.
The then military dictator instead embarked on a series of austerity measures aimed at cutting government spending.
All though many historians have argued that his policies were draconian and even worse than IMF recommendations, the reality with the benefit of hindsight is that history would have been kinder to him under a different set of circumstances.
But Buhari is hardly new to the political arena in Nigeria having contested in the last three elections coming a distant second and shedding his military toga in the process.
Today, no one would deny Buhari the spirited persona of a born again democrat. Indeed the groundswell of positive public perception had well permeated the global community.
Early into Buhari’s victory lap run, Nigeria was already the focus of the kleigh lights in the international community.
Reacting to the outcome of the election, the President of the United States of America, Barrack Obama, said, “I commend President Goodluck Jonathan and President-elect Muhammadu Buhari for their public commitments to non-violence throughout the campaign.
“President Jonathan has placed his country’s interests first by conceding the election and congratulating President-elect Buhari on his victory.”
He therefore urged the president-elect Buhari and President Jonathan to repeat their calls to their supporters to continue to respect the election outcomes, focus on unifying the country, and together lead Nigeria through a peaceful transition.
In their separate messages, Prime Minister of United Kingdom, Tony Blair, President Francois Hollande of France, President Hassan Sheikh Mohamoud of Somalia, Rwandan President Paul Kagame and Prime Minister of Niger, Mahamadou Issoufou, all congratulated Buhari on his victory and Nigerians for conducting a credible election that would ensure a peaceful transfer of power from one elected administration to another.
But among those who visited to felicitate with Buhari in Abuja were the US Assistant Secretary of state for African Affairs, Linda Thomas- Greenfield and the US Ambassador to Nigeria, Ambassador James Entwistle, among others.
They all pledged their support and commitment to ensuring the success of the Buhari administration and for better relations between their countries and Nigeria.
Already, the potentialities of a Buhari victory are already evident as the stock market seems to react positively, gaining N904 billion as investors swoop on highly capitalized stock.
The stock market has gained all losses witnessed in the first quarter of the year.
The Naira appreciated by N2 to close at N215 to the dollar after the peaceful conclusion of the election but analysts say if the Naira is to witness such continuous appreciation, Buhari must provide economic leadership unmatched by previous dispensations.
This is the challenge facing the Daura-born army general who is now bracing to the current realities.
This challenge also provides a great opportunity for investors to tap into Nigeria’s power gap as Nigeria continues to demand improved electricity. Buhari would need to improve the current foreign exchange by formulating policies aimed at strengthening the Naira.
Buhari would be expected to provide political, social and economic public goods and services that will benefit her citizens.
Although the outgoing president presided over a period in this country’s history which saw Nigeria record her highest foreign direct investment catapulting it to the top of Africa’s biggest economy, Buhari, investors worldwide will be watching Nigeria with a keen interest judging the country from several indices.
One of the indices that will be used is the corruption perception index.
Nigeria over the years seems to be cleaning its house as it tries to cut government excesses.
Ranked 136 out of 187 countries in 2014 up eight places, investors would expect Buhari to show greater commitment in the fight against corruption which would significantly reduce the cost of doing business in Nigeria.
Buhari would also be expected to end the dreaded scourge of Boko Haram; Nigeria’s extremist group and by so doing reintegrating isolated regions to the country to boost economic inclusion.
Corporate players outside the shores of the country are quick to imbue the global community with that air of infectious optimism.
Says Mr Glenn Davies, Group CEO of Inigmah of Singapore:
“Mr. Buhari’s election is a game changer for Nigeria and for Africa as a whole.
“The very nature of how this election was won shines a positive light on Africa’s largest economy and sends a clear signal to the rest of the continent.
“Not only does the election mark the first time an incumbent president has lost re-election in Nigeria, but it has done so without violence, although this still remains a high risk. This is a great start to what I believe will be Nigeria’s turning point moving forward.
“Buhari stands for change and this is exactly what Nigeria needs. Nigeria’s growth has been impressive to watch and a prodigious place to do business over the past few years.
“More recently though, this growth has slowed and the country marred by harrowing violence and the rise of extremist insurgents. Mr Buhari will need some ‘quick wins’ to settle the country’s nerves and prove why he was elected.
“First priority on the cards will be to carefully and strategically choose his team – this will be key to his success. Then shortly after look to address the main issues headlining being Security and defeating Boko Haram, addressing falling Oil prices – countering this with new positive stimulating measures, and of course, commencing the arduous and incredibly challenging process of ridding the country of corruption.
“I feel Mr Buhari can then focus on some more positive key initiatives such as better infrastructure, industry diversification and creating new jobs and opportunities.
There’s no doubt that Mr Buhari’s success will have given Nigeria new credibility on the African and international stage. This will translate into heightened interest from neighbouring countries and international allies keen to work with Nigeria, and will be extremely positive for the economy overall.
But it won’t be an easy road – monumental challenges lie ahead.
“I don’t think Mr Buhari needs to overcomplicate things though to make a real difference in Nigeria. If he simply only focused on two issues – Security and Corruption – he will go down in the history books and Nigeria will overnight be a better place. Getting these two right will rev up the economy and let the world know Nigeria is open for business.’’
Also expressing his thoughts on a new Nigeria under Buhari, Leopold Ebegbuna, the MD/CEO of Rising Light Global Company, said:
“I see Muhammadu Buhari struggling to redress Nigeria’s major challenges. The President-elect promised an end to the Boko Haram insurgency that has killed thousands of Nigerians and forced over a million to become Internally Displaced Persons, IDPs.
“He campaigned on a reputation as an anti-corruption crusader, and made populist pledges such as stipends for poor people and health care for all, etc.
“The reality is that by the time Buhari takes office at the end of May, he’ll inherit a treasury depleted by the global drop in the price of oil, Nigeria’s biggest export, he will be left to figure out how to put an end to Boko Haram insurgency, the IDPs, fighting the entrenched corrupt practices which had flourished for years, etc.
“Fulfilling his election promise of change will be herculean especially starting with those who sponsored and supported his election within his party.
“The result is likely to be some form of austerity – big social spending programmes, such as universal health care, may have to wait, the task of rebuilding the northeast, crucial to putting an end to Boko Haram, may be difficult. If he can reduce the wage bill of politicians and civil servants, who alone account for the huge recurrent expenditure, he will remain very popular among the masses,’’ he said.
Inspite of the gloomy picture of an economy in recession, a Buhari victory has opened up immense possibilities for Africa’s largest economy on the global runway.
The election for one gives Nigeria more credibility and clout within the West African grouping, ECOWAS, at the African Union, and internationally.
But even much more important, Nigerian leaders can no longer be dismissed as hypocrites when they lecture recalcitrant neighbours on the need to keep the military out of politics.
This is the new Nigeria which many look forward to but which the emergent opposition sees as stultifying.
Former Deputy National Chairman of the Peoples Democratic Party, Chief Bode George, has already said he may be going on exile following the victory of Buhari.
George had said in an interview that he would proceed on exile if the APC wins at the federal level.
Speaking with newsmen on the PDP’s defeat at the polls, the PDP chieftain said: “What will I be doing here? I can decide to go and live anywhere. Look at everyone surrounding him (Buhari).” So, I am not joking about it, what will I be doing here? At 70, what will I be doing here?
How many Nigerians would miss the loquacious retired Naval Officer in the unveiling of a new era which promises growth and unlimited possibilities for the spirit man?