Glad to be back. By now, even the most ardent observers of Nigeria’s public finance must have given up on the possibility of ever finding those ‘unknown’ elements in its many-sided, quasi-federalist, quadratic equations. Unlike the traditional quadratic function where you keep some elements constant while cracking the unknown, the Nigerian equation, like a perennially moving target, keeps morphing not very much amoeba-like, of better still, like a mutant variant of a wayward gene; until you find that the solution you sought was neither understood nor in any sense captured in the originating hypotheses! And so the problem, like the gangrenous ulcer, not only festers but actually defies imminent solution!
A lot has of course happened since early August when this columnist went on vacation. First, the apex bank has ‘duelled’ with the Nigerian National Petroleum Corporation, NNPC over what is remitted into the nation’s piggy bank. Then, at issue was an alleged non-remittance of dollars into the nation’s foreign reserves by NNPC which the apex bank claimed to be the reason for the plunge of the naira in the official and parallel markets. Although a document from the NNPC later surfaced to show it remitted a total of $2.7bn into its accounts with the CBN from January to June, it still fell short of satisfactorily addressing the underlying discrepancy as both of them could not have been right at the same time! The last that was heard on the matter was that the presidency had waded into a matter!
That dust had barely settled before another joust erupted between the NNPC and the National Customs Service. This time, the issue is on the former’s claim that it supplies about 98 million litres of petrol for the country on a daily basis even when actual consumption is no more than 60 million litres. In essence, that a whopping 38 million litres of fuel are smuggled across the borders daily – and this under the watch of the men of the customs!
Expectedly, the Customs Comptroller-General, Hammed Ali, would have none of it. While appearing before the House of Representatives Committee on Finance, he had asked somewhat incredulously: ‘If you say you release 98 million litres and then, we use only 60 million litres; the balance will be 38 million litres.
How many trucks will that 38 million litres every day be? That will be almost 500 trucks; which roads are they following, where are they carrying them to’? He had asked.
By the way, that was the same million naira question raised by the revered columnist Olatunji Dare last week.
This columnist is not aware that the question has been satisfactorily answered by the NNPC. Or by anyone in government for that matter. Yet, this quantum – more than half of the national requirement – form part of the stock on which the country is expected to pay the subsidy under which the economy currently reels.
Finally, the Nigerian Navy, as if waiting to be prompted has, amidst the unrelenting claims of massive theft of crude oil, has sought, perhaps finally, to demolish the claim by the NNPC and by extension, the federal government, of that massive theft.
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Occasion was the briefing to commence the 64th anniversary celebrations of the Nigerian Navy in Abuja. There, Chief of the Naval Staff (CNS), Vice Admiral Awwal Gambo, would argue that much of the talk about crude theft is sheer hogwash. Maintaining that the figures, which range from 200,000 to 400,000 barrels a day, was impracticable, he insisted that many of the presentations on the subject was borne either out of ignorance or mischief.
Says he: “We need to understand the differences between oil theft and of course, oil loss. While oil theft is siphoning oil from vandalised pipes into barges, oil losses occur when there is non-production, especially during shut-ins and force majeure as the federal government does not earn the desired revenue it should”. To him, the problem is that oftentimes, the volumes from shut-ins due to non-production are added to oil theft data instead of accounting for them as oil losses by the authorities.
For context, he says 100,000 barrels of crude oil is equivalent to 15,800,000 litres of crude, which requires a five-ton barge making 3,160 trips per day to convey out of the creeks!
And the ponderous question: “How do you pass the estuaries with this? So, let’s assume now you even have many barges because of the time required to carry out this product. That means you entirely close the navigable waters heading out to sea, through the estuaries, to embark them or to transit them into a mother vessel that will eventually take them out of the country.
“Of course, this is most unlikely considering the heightened presence of security agencies in the maritime environment as well as the launch of the subsisting operations by the Nigerian Navy, including of course, the deployment of the maritime domain awareness facilities”.
So much for the clarification that leaves out the million-dollar the question of how a country that once delivered in excess of two million barrels of crude has failed to meet up its 1.8 million OPEC quota. Not once or twice have yours truly heard from those who should know, that we may have all along been looking at the wrong direction for the unexplained or better still, unexplainable shortfalls in crude production. Rather than those barges in the creeks, some have actually suggested that we shift our gazes to our marble palaces where all things unimaginable take place!
And while the blame game goes on, between the triumvirate of a corrupt, inept and hopelessly inefficient national oil corporation, an out-of-control apex bank that has virtually re-written all the rule books about central banking and a customs service off the leash, our dear president Muhammadu Buhari, has finally found an answer in the Presidential Committee on National Economy inaugurated last week!
The committee, according to the president, is expected to review the national economic situation and propose measures to ensure the progress of the economy, receive regular updates on economic conditions in the country, identify issues that require urgent intervention to improve macroeconomic and fiscal conditions, review the impact of existing and new policies on the economy and provide directions to relevant institutions responsible for fiscal, monetary and other relevant policies.
By the way, does this president still have Economic Advisory Council (EAC)? And what is the role of the National Economic Council in all of these?
Were the country not to be in dire emergency, the latest development would have been tagged comical. In other words, no garlands for leaving the country on auto-pilot; a country which the fiscal side of governance has been on a long Rip Van Winkle sleep and the apex bank in the absence of the established restraints of convention and governance has not only been left to fly solo, but also blind.
Is anyone still in wonder why the naira, the symbol of the nation’s economic strength, is on a free-fall with no respite in sight? Or why inflation is running riot while those in charge would rather shop for alibis?