By Adekunle Ade-Adeleye 

In his Eid el-Kabir message last Tuesday, President Muhammadu Buhari reflected on the vexed issue of inflation and explained the factors responsible. Apart from the disruptive hangover from the Covid-19 crisis, insecurity and terrorism, he says that the callous activities of middlemen are also to blame. It is strange he mentioned middlemen, a continuing leitmotif of his leadership’s interpretation of economic maladies. “COVID-19 pandemic has taken a heavy toll on the economies of all countries, including Nigeria,” he says. “In addition to the fact that floods have caused large scale destruction to agricultural farmlands, thereby impacting negatively on our efforts to boost local production in line with our policy to drastically reduce food importation.” Continuing, he also asserts that “No government in our recent history has invested as heavily as we are doing to promote local production of about 20 other commodities, through the provision of loans and several other forms of support to our farmers.” Then the clincher: “Apart from the destruction caused to rice farms by floods, middlemen have also taken advantage of the local rice production to exploit fellow Nigerians, thereby undermining our goal of supporting local food production at affordable prices.”

In September last year, days after he allowed a spike in fuel prices, the president also found the rationale to blame middlemen for rising food prices. He had said at the time: “We are also engaging with food producers associations and groups to tackle the issue of exploitative behaviour by middlemen and other actors, which is one of the factors responsible for the high food prices being experienced.” Alas, the ubiquitous middleman. It is not clear just what the president, his speechwriters and advisers think of the laws of demand and supply; but clearly, he has made up his mind whom to blame and what factors to recognize for the costly food crisis the country has battled with since his assumption of office. In his first tour of duty as a military head of state, he had also blamed middlemen for rising food prices. He will doubtless leave office firmly convinced that middlemen were the scourge on the food chain, and a pest that must be controlled, if not extirpated. But if he is disquieted by the fundamentals of economics, particularly the principles that guide what social scientists call the allocation of resources, should his advisers and those men and women whom he placed in charge of managing the Nigerian economy not educate him and calm his fears and suspicions?

A textual analysis of his last sallah message reveals that he also blames insecurity, Covid-19 and terrorists for the food crisis Nigeria is facing. Probably deliberately, he was careful not to expatiate on the terrorists he blamed for the problem, and was rather expansive, and thus imprecise, in also blaming

bandits. He said nothing about rampaging Fulani herdsmen, a major cause of the food crisis being experienced in the south. But perhaps he subsumes the criminal herdsmen under the general category of insecurity and terrorists, even though he had not for once described them as terrorists. Instead, he has sought to corral state administrative and security apparatuses to enable and succour the herdsmen, regardless of how much Nigerians in the Middle Belt, South-South, Southeast and Southwest blame them for disrupting food production and destabilising farming communities. By refusing to zero in on the major causes of insecurity and terrorism, the administration is unlikely to make a significant headway in solving the crisis of rising food prices.

Middlemen, whether now, last September or in 1984, are not the significant factor the president has made them out to be in explaining Nigeria’s economic crisis. Like other factors which the president has focused on inordinately, middlemen respond to simple economic stimuli by charging high prices to move food crops and other agricultural products to sea ports and retail markets. The roads are bad, and are infested with all manner of criminal elements, including kidnappers and bandits who extort itinerant traders and motorists. Fuel prices have gone up, and it is befuddling that the administration does not expect a significant cost-push dynamic to meddle with prices and inflation. Moreover, herdsmen have depopulated farmlands and made the production of food crops tedious, exorbitant and unappealing. If the administration had got its economic basics right, it would have put emphasis on eliminating the factors that instigate price increases rather than sentimentally blaming and castigating middlemen who are also victims of the same atrocious factors militating against food production. Which middleman will stand in the way of surplus food supply by hoarding or charging high prices? Middlemen do not operate as a cartel, and are in no position to defy the laws of demand and supply. But as long as the administration can’t determine whether the country is dealing with demand-side or supply-side economics, they will always misplace their priorities.

In 1984-85, the then Buhari military administration never made headway in dealing with the country’s economic crisis because it blamed middlemen, instituted price controls, broke warehouses open and forcefully sold what the public pejoratively called essential commodities (essenco), and developed all manner of populist measures that simply constricted the economy and pushed the economy into a downturn. The same jaded factors and perspectives are now being systematically exhumed. They will not yield fruit. Few Nigerians thought the Buhari administration had an economic team of knowledgeable theoretical and developmental economists. In fact, the administration has in consequence been largely ad hoc and eclectic. With approximately two more years to go, it is unlikely that it would heed advice to go back to basics. It won’t happen. The administration will muddle through with practically nothing to show for their piddling efforts, while the people become more and more impoverished.

Katsina ranching and Gov Ortom’s displeasure

Two Thursdays ago, Katsina State governor Aminu Masari confirmed the receipt of N5bn from the Buhari administration as financial assistance to enable the state develop its ranching programme. The total package is N6.25bn, out of which the initial sum had been paid into the coffers of the state government. The governor did not disclose the circumstances surrounding the release of the fund, whether it is a loan or a grant. Katsina is All Progressives Congress (APC) like the president. This probably prompted Benue State governor Samuel Ortom of the Peoples Democratic Party (PDP) to question the propriety of the financial assistance to Katsina, insisting that Benue State should also be given about N100bn to develop its ranching programme. The president will pay no heed to Mr Ortom.

The Buhari administration has been sorely lacking in finesse. It can assist states, companies and individuals in any project designed to benefit the country and aid economic growth and development. But it must do so under a coherent and consistent policy or programme, in an open and transparent manner that makes the use of public funds accountable. In giving Katsina the N5bn, it behoved the administration to explain the rationale for the assistance as well as indicate how many states would benefit from the programme, and how much would be given and when. Indeed, if the Katsina State government had not disclosed the payment of the N5bn, probably no other state would know. It is also significant, but disturbingly so, that such assistance began with the president’s home state.

The National Livestock Transformation Plan (NLTP) indicates that the four states of Nasarawa, Adamawa, Plateau and Gombe willingly accepted to be part of the pilot stage of the plan. Each should have benefited from the first set of grants, especially because in February the government announced that the Dutch Investment Agency (RVO) had given Nigeria 400,000 euro for that purpose. But it seems the NLTP is dead, and in its place an unaccountable and opaque ranching grant has been instituted. The administration will whimsically determine the beneficiaries; and those who loath the administration’s ranching plan will be punished for their intransigence.