Tag: dynamics

  • Dynamics of ASUU strike resolution

    LABOUR minister, Chris Ngige, announced last week as part of a package to end the strike embarked upon by ASUU last November that the federal government had approved the release of some N35.4bn owed university teachers. Incredibly, part of the money had been owed since 2009. Why then were the government and the people surprised that university teachers went on strike, or critical that ASUU had been unflinching? Indeed, why would university teachers be owed so much for so long when political appointees and federal civil servants are hardly owed so much and so systematically?

    ASUU will, however, soon discover that after the strike ends, the condition of universities, not to say the funding deficit that has crippled their operations, will barely respond to medication. The reason is not just because the government owes the universities and their workers, in itself criminal negligence, it is essentially because the Muhammadu Buhari government, like its predecessors without exception, has no overarching and coherent programme and policies for tertiary education. They do not know education’s great value, nor can they situate their puny programmes within a greater vision for today and the day after tomorrow.

    The situation is truly hopeless. And from all indications, even the settlement controversially reached but not yet given life between ASUU and the federal government will be insufficient to reclaim lost educational grounds, not to talk of attempting to catch up with the rest of the developed world. No; Nigerian leaders are not so ambitious. Indeed, ASUU and other patriotic organisations in Nigeria will continue to tilt at windmills in their struggles to reinvent the country and reframe its despairing narrative.

  • Dynamics of corporate governance

    Dynamics of corporate governance

    Corporate culture in every corporate setting drives the behaviour of its players, as culture engrains the inescapable norms of fairness, transparency, accountability and ethical behaviors. Absence of these, presents subsisting rules and codes as external impositions to the organization’s stakeholders and this often result in lack-lustre adherence and or total resistance to such rules and codes. This undermines proper growth and development of the enterprise.

    The book Corporate Governance- An Emerging Economy Perspective attempts at responding to the growing dynamism of Corporate Governance.

    In its crisp, incisive, straight to the heart of the matter approach, this detailed, broad based and comprehensive discourse of the critical and all relevant subject of Corporate Governance in Nigeria is indeed an epitome of erudition, industry and lucidity. Its depth of discourse has drawn on recent codes with copious illustrations taken from different sectors but heavily from the oil and gas industry. A Nigerian manual with a rich international flare, truly domesticates corporate governance practice. Easy to read, with lots of comparative examples of legislations and codes from other climes, like the United States of America, United Kingdom, Malaysia amongst others, it is a comprehensive reference book. The author admirably examined the theory and practice of corporate governance in Nigeria and concluded that whereas there is no paucity of legislations and regulations, the phenomenon of impunity has given rise to weak compliance, enforcement and depreciated the unabating corruption in our corporate and national life. He proffered suggestions on how to stem impunity and corruption – the bane of corporate governance in our environment.

    The opening chapter of the book, by way of introduction, defines the subject in a most understandable manner to practitioners, students and laypersons. While laying out structures that support the subject matter and its relevance to Nigeria, it decisively dealt with corporate governance as opposed to corporate management as well as numerous theories that has been postulated on the subject.

    Delving into the historical evolution of the discipline in Nigeria, the author captured the role of regulatory authorities in trying to define the structure and rules of corporate governance practice in Nigeria. His comparism of practice in Nigeria with several other emerging economies leaves one to wonder how long it will take Nigeria to clean its stable to join the League of Nations with good business and ethical practices to anchor a developed economy.

    Chapters 4 – 7 has in-depth discourse on Boards of Directors – composition/ structures, duties, responsibilities, limitations and other key players, their operational processes – through committees and relationships amongst themselves and between them and other stakeholders in the governance of businesses. The attention given to legal duties/liabilities of directors, interplay of stakeholders and markets in relation to the internal workings of the board re-echoes the cardinal role directors play in Corporate Governance. Discussing risk management, audit, ethics, and leadership development as important influencing factors of corporate success, he elevated the need for transparency, accountability and integrity in the governance of businesses. The abuse of the foregoing lays bare certain missteps that account for failures of enterprises and their boards in both the public  and private sectors in Nigeria and globally.

    With brief discourse of corporate governance in other sectors- private companies, the informal sector and not for profit organizations, the author canvassed that the existence of regulations and codes which majority of business leaders in publicly quoted companies strive to comply with, provides important guide for these other sectors and any medium to large size company aspiring to survive and grow sustainably beyond its founder through generations must necessarily adhere to the regime of controls which publicly quoted companies are governed with.

    Given the global concern for good corporate governance, the author spent time to discuss the OECD and the United Nations Convention against Corruption (UNCAC) principles of corporate governance which frown at all forms of corrupt practices in the business place. Willful disclosure, transparency, accountability and fair reporting are a must for the boards and Management of organizations that will sustainably grow over time. He raised the question, where are there still a litany of enterprise failures in the midst of numerous regulations and raft of audit processes?

    The author concludes with a critical look at emerging trends in the subject matter leaves one yearning for more as the author breaks for the next publication. The book is indeed a reference material for directors, practitioners and others involved in corporate governance roles. It also provides good reading for advanced management and business studies students running MBA and other post-graduate courses.

  • Edo’s debt profile: Dynamics of govt finance

    Statistics have a deft way of creating one impression or the other, sometimes for good, and at other unwelcome times, for bad.

    The latest Nigeria Extractive Industries Transparency Initiative (NEITI) Quarterly Review shows

    Nigeria’s debt profile and indicates a drastic drop in the revenue profile of most states of the federation. In the Southsouth, the report ominously avers that the debt profile of the state governments is on the increase, consisting of domestic and external debts between December 2015 and June 30th, 2016.

    For instance, Lagos state has the highest cumulative debt of N603.25 billion as against the state’s revenue of N410.5bn for 2016. The second on the debt table is Delta State with N331.95 billion growing debt as against N142.78 of the state revenue. Akwa Ibom State occupied the fourth place on rising debt profiles with N161.23 billion.

    What cannot be ignored in the NEITI report is that it clearly vindicates Edo State on both domestic and foreign debts. The World Bank loan Edo State took is cheaper to service and attracts about 1% interest rate compared to domestic borrowing that attracts 18% interest

    rate. The report maintained that “considering that most states already have a high debt burden,

    the possibility of even higher debts for the states remain quite high.”

    Among the subnational governments, Lagos, Kaduna, Edo, Cross River and Ogun states retained the top spots on the list of foreign debtors. If Nigerian external debt accounts for 20% of Nigeria’s debt profile, how does Edo’s debt constitute one of the highest? Is 20% more than 80%? Is the external debt stock of $11.41 billion (N3.48trillion) which accounted for 20%

    more than the domestic debt stock of $45.98 billion (N13.88trillion), which accounted for 80%?

    A clarification is necessary here. The total debt profile of $57.39bn is made up of external debt stock of $11.41 billion (N3.48trillion) which accounts for 20% and domestic debt stock of $45.98 billion (N13.88 trillion) which accounts for 80%. The external debt of 20% cannot amount to the highest.

    Analysts should stop categorising Edo State as the most indebted states in Nigeria. The rate of the rise in foreign debt has been slower than that of domestic debt. In recent times, the Federal Government has been making attempts to increase the proportion of foreign debt, because of the higher interest rate charged on domestic debts.

    Edo State is just as privileged as Lagos state in Sub-Saharan Africa to access World Bank loans at less than 1% for 20 years, and in some cases, 10-year moratorium.

    For a shared understanding of Nigeria’s domestic debt, a major source of concern is that Nigeria’s public domestic debt has experienced rapid growth over the past 10 years and that debt service outlay is quite high. The domestic debt-GDP ratio is only about 10%; the total public debt-GDP ratio is 12.25%, and compares favourably with the peer group threshold of 56%.

    Although the debt service-revenue ratio is high, the problem needs to be unbundled so we can all agree on the appropriate solution path. Indeed, following the rebasing of Nigeria’s GDP in 2010, the DMO observed that the increase in the GDP did not enhance the country’s ability to service its debts.

    Nigeria’s tax revenue-GDP ratio is still below 6% compared to the average for the country’s peer group, which is 18%. Essentially, therefore, from this perspective, what is being experienced is a revenue problem which impacts the debt service-revenue ratio.

    Already the Federal Government is set to raise its domestic and foreign borrowing ratio under the new Debt Management Strategy (DMS) unveiled by the DMO for the next four years. The DMS is about how funds are borrowed, internally and externally. It is a medium term project from 2016 to 2019 setting out the broad guidelines for four years. A review of the new debt strategy shows that it would slant significantly in favour of external borrowing than domestic borrowing.

    As Mr. Nwankwo said domestic and external borrowings would now be in the ratio of 60:40 per cent as against the previous ration of 84:16 per cent respectively. The new borrowing strategy, he explained further, would progressively increase the percentage share of external financing, taking into account the need to moderate foreign exchange risk in the short to medium term.

    He said the reason for the shift towards more external borrowing was because external borrowing was cheaper, apart from the advantage of lower cost of fund to avoid the risk of crowding out the private sector.

    Only Edo, Lagos, Delta, Ebonyi, Anambra, Cross River, Akwa Ibom,  Kano and Enugu states have paid their workers’ salaries and allowances up to April and are therefore not owing their workers.

    From the foregoing, there can be no doubt that Edo State is on the right path with its borrowing for the development of the state. It is one borrowing ideal that does not commit the state to punitive debt burden that generation unborn will have to bear.

    • Cephas sent this piece from Benin City
  • OPEC Sec-Gen to meet Osinbajo, Kachikwu on oil sector dynamics

    •Barkindo in Nigeria for conference

    Organisation of Petroleum Exporting Countries (OPEC) Secretary-General Mohammad Barkindo will this week discuss market dynamics in the oil sector with Acting President Yemi Osinbajo and Minister of State for Petroleum Resources Dr Ibe Kachikwu.

    Dr. Barkindo, who arrived in Nigeria yesterday, will also attend the 16th Nigeria Oil and Gas Conference (NOC) and Exhibition during his four-day working visit.

    The News agency of Nigeria (NAN) quoted the Nigerian National Petroleum Corporation (NNPC) spokesman, Mr Ndu Ughamadu, as saying that the fallout of Barkindo’s visit will be felt in the sector for a long time.

    Ughamadu was quoted as saying: “Yes, it is a big event that will affect our markets positively. He is leading an eight-man delegation and his advance team arrived earlier and will talk on the oil and gas market outlook.

    “I believe whatever policies put in place here will be strictly adhered to and give our economy the needed boost.  I’m excited. It’s a big event.”

    At an earlier news briefing, Ughamadu said Dr. Kachikwu would give a keynote address on Repositioning the Oil and Gas Sector’ and that the  NNPC’s Group Managing Director, Dr Maikanti Baru, would speak on “`Commercialising the NNPC”.

    The four-day conference will end Thusday.

    More than 6,000 delegates, 250 exhibitors, from over 20 countries, many oil and gas experts and hundreds of government representatives and other stakeholders from different countries would attend the conference.

  • Understanding the dynamics of real estate sector

    Is it possible to ask for the price of a Bentley in exchange of the quality of a Toyota? Impossible! Any sane person knows that. While many will consider this outrageous, it is indeed a stark reminder of the realities experienced in Nigeria’s real estate industry.

     As an avid property enthusiast, developer or an observer, you must have noticed the surge in the number of empty apartments in Ikoyi over the last few years. This disturbing phenomenon must have prompted the well-informed and educative research publication of economy watch, Financial Derivatives Company Limited, last week, which pointed out that “the number of vacant properties in the upper class real estate neighbourhoods of Lekki, Victoria Island and Ikoyi has risen by 72 percent over the last 18 months”.

    The padded cost of construction. Buyer Beware! This has become a motto on a whole new level for perceptive investors, who seek the much-deserved value for money. I can’t stress enough, the fact that the era of monkey dey work, baboon dey chop is long gone. To avoid drawing hasty conclusions and to guide our investment choices, investors should only listen to industry experts and verifiable perspectives as seen in the FDC research, and avoid the bandwagon of those listening to jaundiced opinions, which are quite popular.  For example, the fact that former UK Prime Minister David Cameron said Nigeria was ‘fantastically corrupt’, did not in fact mean each and every Nigerian was. Also, the fact that a few celebrities find themselves enmeshed in marital problems does not always mean that the marital life of every Nigerian is in danger. To put this more clearly, apartments that should not cost more than N100 million are costing investors N400 million to construct.  Therefore owners have no other choice than to let out the apartment at N40 million, transferring the padded cost of construction to tenants.

    ‘What’s the difference between the locally fried plantain bits sold in remote areas and its counterpart, the plantain chips sold in urban areas? Have you ever wondered why a good meal prepared in Ijebu Ode would cost less than one sold in Lagos? An estimated rental for an apartment in Ikoyi is about $80,000. The same apartment in Lekki would cost $30,000. What do you think makes the difference? VALUE – price, quality and location put together in the same place! If location is a fundamental principle in real estate, how much more luxury real estate?

    A developer who compromises on the quality of materials, no matter how highbrow the property’s location, has no right to place an exorbitant price on it. Thus, the argument for demand exceeding supply, as far as empty apartments in Ikoyi go, is unfounded.

    Luxury apartments are in high demand. Poorly finished buildings with exorbitant prices constitute the pile of empty apartments constantly being alluded to.

    During my interview on CNBC Africa, I once pointed out that luxury is not expensive. It is the intention to deliver luxury that is expensive. While the cost of a nice three-bedroom apartment in Johannesburg would go for about $350,000 the same apartment in Ikoyi would want $1M. If the cost of construction materials is the same all over the world, the price of marble, granite, cement, tiles, kitchen, doors paints etc, why is cost in Nigeria about 300% higher?

    A delicious meal requires a lot of money. You cannot offer a Toyota for the price of a Bentley. One might argue that both cars will eventually ply the same road but the efficiency and prestige of a Bentley speaks for itself. Luxury sells itself.   When you sell luxury, you sell peace of mind, you have not only sold something that would last for generations, but you win the heart of your client who now becomes your evangelist.

    With the oil price plummet and downtrend of major economies across the world, individuals and organizations no longer have loose money to throw around. And with the current downsizing by companies, prospective tenants demand full value for their hard-earned money.

    Nigerian developers must realise that times have changed. The ‘quick fix – quick gain’ syndrome has ended. Real estate developers who fail to understand that the current investors and real estate enthusiasts are upbeat about quality and finishing after having seen same from their travels around the world will soon fade away.

    If we desire to be the best and want to compete with foreign developers such as the Germans, Lebanese and Italians that have spent decades mastering their craft, we will need to raise our standards in the Nigerian construction market.  Or else, one day we would wake up to find all our apartments empty.

     

    • Ogundele, a real estate practitioner writes from Lagos.
  • Dynamics of APC, PDP presidential campaigns

    Dynamics of APC, PDP presidential campaigns

    Barely one week into their presidential campaigns, the leading contenders for the presidency, the Peoples Democratic Party (PDP) and the All Progressives Congress (APC), have given indications of the perspectives of their candidates and parties, as well as, strangely, the deep and fundamental intangibles of their worldview as they relate to the concepts of leadership, vision and philosophy, either real or abstract. It is not certain that the limited time available for campaigning is enough to make the PDP persuade Nigeria’s distraught, cynical and skeptical electorate to re-elect President Goodluck Jonathan, to overlook the many problems he has been unable to grapple with in a coherent, consistent and courageous manner, and to sympathise with his emotive responses to allegations of illiberal approach to politics and shocking lack of intuitive appreciation of the elementary challenges facing the country he has ruled for more than five years.

    Nor is it also certain that the limited campaign time will permit Muhammadu Buhari, the APC presidential candidate, room to sell his candidature and virtues, and also to dispel the many criticisms validly leveled against his less than two years in power as military head of state in the early 1980s. Many of those criticisms, in spite of the long intervening years — nearly all of 30 years — still retain their potency and validity. There are doubts he has really transformed from a rigid, abrasive, ruthless and imperceptive ruler he once was. He is accused of jadedness, sectarianism, tribalism, lack of rigour or intellectual depth, and an unforgivable lack of empathy. His opponents will try to put him on the defensive and make the time very short for him to prove his bona fides.

    Indeed, the dynamics of both campaigns will be influenced by the considerations above, some of them extraneous, others misplaced and specious, and yet others simply deliberately mischievous. The more adept of the two campaigns will, however, utilise the limited time fairly effectively, if not to completely prove their competence to present the next president, at least to make their candidate the lesser of two evils. Given the constricted choices the country faces, the electorate will have to choose one way or the other, for choose they must. So far, as a matter of fact, both campaigns have emitted sublime signals, some of them quite portentous, of what their parties are, who their candidates are at bottom, how limited their vistas are, and what they mean to Nigeria. It is not quite clear whether a consideration of these intangibles, these so-called sublime signals, will influence the direction of voting, for the voters are themselves quite limited in horizon and are sentimental. But these signals will doubtless determine the direction, health and sustainability of the country in the medium to long run.

    Take the kick-off of the Jonathan re-election campaign in Lagos for instance. It was symptomatic of the partisan malaise that has turned the PDP into a fearsome behemoth with no internal moral core and absolutely no regard for other political parties and democratic fundamentals. The kick-off also showed in disturbingly bold relief Dr Jonathan’s intellectual weakness, questionable historicism and perverse logic, limited worldview, malignant extemporaneousness, sweeping and unpardonable generalisations and conclusions. “Those of my age and above are finished; we are gone,” moaned the president puzzlingly. “That is why I am addressing those of you that are voting for the first time. We believe it is you that will take us to the moon. My generation has failed, we couldn’t take Nigeria to the moon.”

    The problem is not just that this questionable reading and understanding of history and contemporary events expose the president’s inadequacies, especially his lack of logical reasoning, but that they indicate a far more disturbing manifestation of the low quality of leadership in Nigeria, a lack of mastery of the existential and geopolitical threats facing the country, and an infatuation with boyish utopia.

    The highlights of the president’s Lagos campaign, especially his tendentious rationalisation of his failing counterinsurgency war, his justification of his slow anti-corruption campaign, his defence of inept arms procurement methods, and his shocking inurement to his self-incriminating statements over MEND’s 2010 Abuja bombing, shocked and perplexed the thinking members of his audience, some of whom exclaimed in gasps behind him on the dais. Nonetheless, some of the facts mentioned by the president were incontestable, such as the neglect suffered by the military over the decades. But his suppositions, his inferences, and his conclusions were astonishingly unpresidential, not to say inimical to the growth, stability and good fortunes of the country. There is nothing he said in his Lagos campaign that entitles him to victory, or gives indication he had the subtlety and philosophical depth needed to rule a complex country in the 21st century. When he was right, which was seldom, he did not cut the figure of a president, or present the facade of a noble or of a philosophical-king. And when he was wrong, which was often, such as when he guilefully and gleefully promoted sectarianism and ethnic divisions, he did not surprise.

    Dr Jonathan, alas, displayed none of the composure associated with the high office of the presidency. In the Lagos campaign, as he sadly did elsewhere in recent times, he quiveringly and emotionally fulminated against his opponents, endorsed the anti-democratic tendencies of state security agencies, preoccupied himself and his presidency with elemental things, and propounded none of the salient and uplifting ideas a complex society like Nigeria should embrace. None whatsoever. In the Lagos campaign, he tried to defend himself as much as possible, though he made a hash of it. And almost as an afterthought, he tried to sell a policy or two, but was unable to persuade either by logic or by force of his personality. The past few decades have been ideationally barren for Nigeria. Under Dr Jonathan, the sterility has grown incomparably. Four more years of him would not regenerate the country, as his campaign seeks to convince the electorate, or reposition it in line with the modernising ideas and infinitely changing complexities of the 21st century.

    Conversely, the dynamics of the APC campaign exhibit a different hue. The opposition party, poised as it seems on the edge of victory, has about three weeks or four to prove the capacity of its presidential candidate and his advertised transformation into a modern, if unaccustomed, democrat and liberal. In Lagos, a hysterical Dr Jonathan said that that transformation was not possible, and a vote for Gen Buhari would ineluctably return Nigeria to the dark days of atavistic prosecution of the anti-corruption war, where suspects were crated and jailed without regard to the law. But compared to Dr Jonathan’s campaign volubility, Gen Buhari, not the most eloquent of men, has always spoken laconically, often with a terseness that belies his political and leadership experience and hunger for office. His gaffes and indiscretions are thus few and far between. Beyond seemingly partitioning the campaign between himself and his running mate, Yemi Osinbajo, a law professor, to achieve maximum impact, the general’s taciturnity and the silent and subterranean jostling for power and influence in the APC appear to cause dreadful unease in campaign and political circles.

    Unlike the PDP whose power structure had earlier been defined and shaped, perhaps disapprovingly, under the Olusegun Obasanjo presidency, with occasional eruptions between governors and the presidency, the APC has the onerous and compelling burden of campaigning for the highest office in the land at the same time as embarking on a difficult journey of self-discovery, self-definition, and self-actualisation. The ongoing internal jostling may have no significant effect on the party’s electoral chances if well managed, but in more ways than party apparatchiks think, the future of the party and its performance as a ruling party, should it attain the highest office, could be considerably stymied by that burden.

    A faint trichotomy is thus visible in the APC. On one hand is the powerful and inspiring arm of the party responsible for the formation of the APC, an amalgam of parties many but that powerful and inspiring few at first believed impossible. On the other hand is the northern caucus desperate to regain the presidency, a desperation fuelled by the incontestably poor performance of the Jonathan government. And on the third hand is a coalition of forces made up principally of governors and other party leaders determined to gain the upper hand in the power struggle, an upper hand they hinge on what they describe as the political altruism of checkmating any domination within the party. The battle for supremacy in the PDP was brutally and peremptorily settled by Chief Obasanjo. It will take a little while for that battle to be settled in the APC, whether they win the presidency or not.

    Though the APC is doing its best to conceal that jostling, a perceptive observer will notice the fault lines, as faint and imperceptible as they may appear. But what cannot be hidden is that if care is not taken, and irrespective of whether the party wins the presidency or not, the internal struggle may be won by an arm of the party that does not have the passion, drive, depth and conviction that inspired its formation. On the surface, there may be nothing wrong with having many tendencies within a party, as some developed democracies have shown. But for a party still in formation, and one which seems close to winning the presidency on the strength of the appalling incompetence and failures of the ruling party, it would indeed be cynical for the jostling within the APC to be settled in favour of an arm more desirous of dominating and moulding it into a typical party, almost indistinguishable from the PDP, than imbuing it with the kind of substance and character both the party and country need to survive and flourish.

    But perhaps this observation is an exaggeration. Perhaps the internal struggles in the APC are rather inconsequential. If that is so, the party is lucky. However, all indications show that there is a mild tremor within the party, even if that tremor may not hamstring both its campaign and battle to win February’s presidential poll. What is clear overall is that both the PDP and its candidate, Dr Jonathan, are “spent and finished,” a Freudian slip the president himself made in Lagos at his campaign kick-off. The dynamics of the PDP campaign are such that the party seems fated to lose the elections because of the president’s off-putting personality and general incapacity. The dynamics of the APC campaign, on the other hand, are such that the party seems poised to outperform its expectations in spite of Gen Buhari’s inability to generate excitement by his speech and campaign style, and the dredging up of many of his past objectionable statements and policies by the ruling party.

  • The nature and dynamics of insurgencies (II)

    The nature and dynamics of insurgencies (II)

    This religious and sectarian insurgency emanating from the Arab world has now spread to Nigeria where, since 2009, the government has had to face the growing security challenge posed by Boko Haram (Western education is evil) to its authority. Before then, very little was known of the existence of this sect and its objectives. It was preceded by the activities and operations of the militants of the Niger Delta, the Movement for the Emancipation of the Niger Delta (MEND) that posed a grave security threat to Nigeria’s oil installations. Here, the grievances were mainly local and economic. Through dialogue, the federal authorities have been able to reach an agreement with the militants involving training abroad for them and some generous financial compensation. But even this can only be a partial solution to a problem that is deeply rooted in the political and economic history of the Delta region.

    The nature of the colonial legacy is responsible to a large extent for the emergence of political instability and the consequent emergence of insurgency in Nigeria. The Boko Haram sect is the product of a political and social process that failed to ensure an even development in the country, with the North lagging far behind the South in economic and social development. The insurgency in the North is a symptom of a deep seated malaise going back to the colonial area during which colonial policies adopted led to the North, the largest and most populous part of the country, falling behind the rest of the country in virtually all respects. Boko Haram is the direct consequence of the failure of northern leaders to invest in the education of their people. It is this failure, and not mere religious differences, that accounts for the deep seated grievances of the Boko Haram insurgents in Nigeria. The process and pace of modernisation in the North have been much slower than in the South. This situation creates frustration among the northern youths who find themselves unable to compete with their southern counterparts in all respects, even in the North.

    Northern Nigeria had been politically restive for some time. Before 2009 when Boko Haram first emerged there was the Maitasine rebellion which the Obasanjo government succeeded in putting down, largely through the application of force. But the underlying problem that produced Maitasine in the North was not really addressed. Boko Haram is the direct successor of Maitasine. Most of the northern states have since come under the savage attacks of the Boko Haram insurgents. There is now a serious danger that the insurgency may extend to other non-Fulani parts of northern Nigeria. Plateau State is the new target of attacks, though the competition for land between Fulani herdsmen and the indigenes in the region is also a major factor in the ethnic clashes there. Plateau State, part of the old Middle Belt, has a large Christian population as well. Its people have always historically been at logger – heads with the Hausa-Fulani who want to dominate the area. So, here the battle is for the control of this mineral rich part of Nigeria. It is both economic and political.

    A recent country report on global terrorism by the State Department of the United States showed that in 2011, 136 attacks were carried out in northern Nigeria by Boko Haram resulting in the death of 590 people. In terms of the global number of casualties in the Boko Haram attacks, Nigeria was placed fifth, after Afghanistan (3,353), Iraq (3, 063), Pakistan (2,033), and Somalia (1,103). It was reported that in 2011 there were some 978 terrorist attacks in Africa with Nigeria alone accounting for over 20 per cent of those attacks. The report stated that the sect was more deadly and vicious in its attacks in 2011 than in 2010. In 2010 only 31 attacks by Boko Haram were reported by the media. This figure increased in 2011 to 136. This year the number and frequency of Boko Haram attacks are likely to be even higher as the sect has increased its tempo during the current year. Already, it is estimated that Boko Haram attacks have resulted in the death of over 1,000 people in northern Nigeria since 2009.

    A former head of the Nigerian Army, Gen. Danjuma, has publicly expressed concerns that Nigeria may become a failed state like Somalia which has integrated on account of a long drawn out insurgency. Many northern leaders have also condemned the sect and blamed it for the situation of economic paralysis in the North There is increasing public concern that the sect seems to execute its vicious and bloody attacks so easily and with almost complete impunity. Despite its best and brave efforts the Joint Task Force, comprising the Army and the Police, has not yet been able to evolve a strategy to effectively tackle and contain attacks by the sect. Vast swathes of northern Nigeria have been rendered ungovernable and ‘no go’ areas. In the states that have been hit by Boko Haram, economic activities have been totally paralysed. The Plateau State has been one of the main targets of these attacks. It has suffered more casualties from the Boko Haram attacks than other states in northern Nigeria. The attacks appear religious in nature as most of them have been targeted at churches and Christians in northern Nigeria. Christian leaders have been restrained in their response to these attacks, but have warned that they may be obliged to urge their people to retaliate as the government has been unable to offer the victims of these random attacks any protection. A few mosques have also been attacked. But these attacks are directed against Muslims who are thought to have fallen behind in the strict practice of the Islamic doctrine and have fallen for the trappings of Western civilisation and way of life that the sect considers evil and unacceptable to strict Islamic doctrines.

    The Boko Haram phenomenon and the emergence of terrorism in Nigeria have to be considered as one of the unsavoury consequences and legacies of colonial rule in Nigeria. British colonial rule in Nigeria sought to create a new state by bringing together under a single colonial administration a country of such wide cultural and ethnic diversity. The central historical fact of Nigeria is that, like most of the other African states, it owes its existence as a nation state to European imperial ambitions in Africa. Lord Lugard, the first colonial governor of Nigeria, and the man who carried out the amalgamation of Nigeria, admitted at the time that Nigeria was ‘a mere geographical expression’ of this new British dependency. The territorial boundaries, the political institutions, and the images of these African states, are the result of European ambitions and rivalries in Africa. But colonialism was both a factor of cohesion and a source of friction. While it brought under one rule people with different cultural and ethnic backgrounds, it did very little to integrate them into one nation.

    The roots of the current insurgency by Boko Haram also lie in the fragility of the political institutions that Nigeria inherited at its Independence in 1960. Post-colonial Nigeria has remained a weak state. The post-colonial political and economic systems were far too weak to contain the centrifugal tendencies in the country. The federal system of government agreed upon at Independence was unbalanced. It failed to provide an equitable distribution of power at the centre. It is this quest for a more balanced political system that has been at the centre of Nigeria’s post-colonial political history. The post-colonial framework was itself the product of the nature and style of the British colonial administration in Nigeria. It created huge divergences in administration in northern and southern parts of the colony.

     

    •To be continued

     

  • Obasanjo and Sanusi: What has good farming got to do with bad economics?

    Mallam Sanusi Lamido Sanusi, the Central Bank of Nigeria (CBN) governor, exudes virtually the same prickly temperament as Chief Olusegun Obasanjo, a former president. Both are highly opinionated, messianic, truculent and impatient with contrary views. Throughout Obasanjo’s two terms in office, he hardly ever climbed down from his public policy high horse, nor ever acknowledged he was clearly wrong on any decision he took. He was right on the huge payout to Nigeria’s creditors, and he was right on all the higher denomination banknotes he ordered issued. He was right on the levelling of both Odi in Bayelsa State and Zaki Biam in Benue State; just as he was right on all the Peoples Democratic Party (PDP) chairmen he whimsically replaced. Obasanjo, in short, was never wrong on anything, and indeed does not believe he can ever be wrong, now and in the future.

    Sanusi may reject this comparison, but like Obasanjo he has never thought himself wrong on anything. He was not wrong on the reforms in the banking system or on the continuing fever of reforms he has unleashed in that sector. He was not wrong on fuel subsidy removal, and now he is not wrong on the decision to introduce N5000 banknote. Perfectly and enthusiastically polemical like Obasanjo, he deploys his fluency, much more than his logic or economics, in intimidating his opponents. If necessary, he summons sarcasm to undermine his opponent’s logic, just as he is doing in his current tiff with Obasanjo. Last week, at an Institute of Directors’ roundtable advocacy forum, the former president had suggested that if all Sanusi was trying to do was curb inflation with higher naira denomination, the CBN governor would inadvertently stall production. To Sanusi, this was a red rag to a bull. Obasanjo’s very words were: “I understand that now he (Sanusi) is focused on fighting inflation, which is a good idea. But if this (N5000 note inclusive) and all that he is focused on is fighting inflation, it will kill production.”

    Sanusi’s reply, which came predictably quickly and with characteristic sarcasm, was ear-piercing. Said he: “This is an interesting country because my uncle or my father, who is our former Head of State, Gen. Obasanjo, you know he is a very successful farmer, but he is a very bad economist. He stands up and says that this higher denomination (N5000 note) will cause inflation and improve hardship… General Obasanjo did N20, he did N100, N200, N500 and N1, 000. He introduced more higher denominations in Nigeria than any former head of state. Obasanjo did N100 note in 1999, he did N200 in 2000, he did N500 two years later, and in that period, inflation was coming down because it was accompanied by prudent fiscal and monetary policy.” On the surface, Sanusi’s sneering and abrasive comment appeared to only damn Obasanjo with faint praise. In reality, however, apart from other wounding remarks, he actually brutally dismissed the former president’s economic logic as unsound.

    Sanusi was unsure whether to call Obasanjo an uncle or a father; indeed his tone was gently mocking. However, he is at least sure the former president’s instinct and judgement as a farmer do not extend to “simple economics.” For as he put it, “We all know that we cannot have inflation by printing higher bills if you don’t increase money supply, and this is simple economics.” No one is sure who will have the upper hand in the banknote controversy, but if we know Obasanjo as well as we pretend to do, he will not let Sanusi have the last word. The former president was in fact uncharacteristically mellow in his initial reaction to the banknote; trust him to be a little bit more acerbic in his next comment. In his fairly long banking career, Sanusi has not been known to suffer both fools and the wise gladly. Even without classifying Obasanjo, the CBN governor will not suffer the former president gladly, nor let him have the last word. And both abhor stalemate.

    If Hardball were to hazard a guess how the war would end, he would refer readers to a long list of Obasanjo’s polemical victims, chief among whom was Otunba Gbenga Daniel, former governor of Ogun State, who is left twitching on the floor with barely a sign of political life in him after many duels with the former president. Sanusi will need all the approvals he can get from an incurious President Goodluck Jonathan to survive the fusillade from the one he cheekily described as the good farmer of Ota and bad economist of Abeokuta.