Recession: Nigeria Has No Constructive Economic Team - Hashim

Salaudeen Hashim

Salaudeen Hashim is a senior program officer who is in charge of security, human rights, migration, agriculture and livelihoods at the Civil Society Legislative Advocacy Centre (CISLAC) based in Abuja.

CISLAC is a non-governmental, non-profit, advocacy, information sharing, research, and capacity building organisation. Its purpose is to strengthen the link between civil society and the legislature through advocacy and capacity building for civil society groups and policy makers on legislative processes and governance issues.

In this encounter with our man LUBEM GENA, he spoke on how Nigeria got into the recession, how to get out of it as well as made instructive comments about fundamental issues in the oil sector. Excerpts:

What is your centre's view around the economic recession in the country?

Basically we think one needs to understand the trajectory that has led to this problem which is based on what happened in the past, what is happening now and the tendency of what is likely going to happen in the future. Of course, we know too well that there have been some inability of the past administration to save for the rainy days which has actually brought us to this point. But that is not an excuse for the present administration. The current administration must strongly ensure that they put in place strategic positions what will ensure that the country's economy is properly restructured.

Our view is that the current drivers of the economy are not properly putting in place adequate mechanisms that will drive us out of the current economic doldrums. They must generate and find structural solutions to what is currently happening. The formal sector is generally not doing well. The economy is contracting. The foreign exchange policies are not doing better. There have been some challenges with the monetary policy rate. Various fiscal and economic policies have not been very fantastic with this administration. So there is the need for an emergency to be declared in the economic sector. It is expected that by now, the government will be able to put in place a proper industrial sector policy that will be viable.

The manufacturing sector seem to be a crux that would be the bedrock to take us out of this doldrum.  Unfortunately, nothing is happening in that sector. We are more of a consuming nation and that is in itself a negative trend for us because, if we don't produce and earn foreign exchange, there is no way we can begin to strengthen our network, the Naira. The Naira is very weak as it is in the comity of currencies. And that in itself is a major catastrophe. We don't have a proper industrial policy. We don't have a roadmap to take us out of the current doldrum. That is the major challenge but that is where we are at the moment.

Is it okay to wholly place the blame at the doorstep of the past administrations as it is currently the trend?

Yes, a lot of mistakes were made in the past but if the present administration had managed effectively what they met on ground, the tendencies were there that we wouldn't be here. The cost of crude oil at the international market is a factor but it is not sufficient reason to continue to keep us in that recession line. There is therefore the need for us to begin to look inwards. And of course the attitude of many Nigerians in giving to foreign goods, products and services is worrisome. So what alternatives do we need now to create? How do we now begin to create options that will bring us to re-activation of our local economy?

 We have huge appetite for imported products over local products. That in itself is one of the gradual challenges we have done to put ourselves where we are today. So value re-orientation on the part of Nigeria is needed. The current  administration must actually begin to do something different. You know, there is a saying that you cannot do the same thing consistently and expect different result. The formal sector is generally suffering. The informal sector now has become the main stay of the country as it were because that is the only place where anything is happening. The formal sector is in near comatose. So there must be a complete emergency declared in our economic sector generally.

That is interesting. You have opened so many chapters already. But let me take you back on one issue. In your perspective and in more specific terms, what do you think the present administration is supposed to have done that it left undone?

One, we don't even have a constructive economic team. You need to have eggheads that will put their heads together to give you a roadmap. In the past we used to have what was called National Economic and Development Strategy (NEEDS). You need to have a development plan that will take you out of this current situation. Unfortunately we don't have one. And there is no plan anywhere to develop any. That in itself is a major challenge.

Number two. Ineptitude and the capacity of those who are managing the economy at the moment. The minister of finance particularly (for me), I think has no capacity and antecedent to manage the economy that the country is facing. That is the challenge. Human resource capacity is one challenge and the roadmap that will take us in terms of developing an agenda; a national development plan should be put in place. These are structural issues.

Now on industrial policy, if you go to the industrial area in Kaduna, you will discover that  it is completely dead. In Ilupeju in Lagos, the industrial area has been taken over by churches. In fact the churches are the fastest growing economy in the country. Go to any industrial area including the textile industries; all of them are dead. So how do you intend to revive an economy which you have a comatose industrial sector?

 That is not going to happen. You must begin to find an alternative in the revival of those particular sectors. And that will be contained in your national development plan. That is the reason why I said, in the last retreat that they had, the very major issue that would have topped the agenda should have been the development of the national development framework and I am surprised that that is not happening. That is the first thing that is needed to be done because you need a manual that will help you to begin to follow your step by step approach in beginning to get the people out of this situation. But unfortunately, we are not even hearing or seen any practical steps taken to take us out of this situation. This is quite unfortunate actually.

Aside from talking to the press, what other efforts have the civil society, (which your centre is a key player) made to draw the attention of the concerned power centres to the catastrophe that we are discussing here? Have your coalition raised any memo to that effect and made it available to those in appropriate quarters?

Basically and generally, most of us have used different fora to respond to the situation that is ongoing. But basically, in this country at the moment, anything you say is always given some political colouration. But of course because we have always credited the government when they do well and faulted when they have gone wrong, that makes us very constructive in terms of issues of national development. We have used various platforms. But we are hoping that in the couple of days, we should be able to also issue an address on the state of the nation. This will let the people and even the government to get to know how basic issues should be responded to.

Part of the issue that we expect from the current administration at the moment is that there should be a state of the union address. The President should address the joint session of the National Assembly and give them constructive and practical plans or roadmap on how he plans to get the country out of the current situation. I don't think that is happening.

 These are part of the issues we are going to be rolling out in couple of days from this centre to let the government know that they need to put some level of seriousness in the current situation of living in Nigeria. Nigerians are suffering and that is clear. If people are suffering this much, you now begin to ask this question, is this the change that this administration said they were going to bring on board when they were campaigning? If it is not, then, they should begin to bring very realistic measures by putting mechanisms in place to be able to address the current situation.

Nigerians are also believing that there are structural issues around the ministry of finance, that of budget and national planning as well as the budget office. Could this seeming inter-related economic structures which you said are not coordinated be implicated as exacerbating the situation?

In our public finance management project, one of the recommendations that we have made that the presidency has taken into account was the need to narrow the proximity between planning and budget which saw the merger that happened. It used to be ministry of planning and budget separately but now you have one ministry of budget and national planning so that proximity can help between conceptualization and implementation. That in itself is a good step in the right direction.

The ministry of finance in itself need to see that some of the architecture is restructured and provide some technocrats the enablement, ability and inclusiveness that will engender participation into the entire development. We used to see team from the finance ministry often times come up with some level of think tanks which are drawn from various sectors of the economy. If you are having those think tanks drawn from various sectors of the economy, they should be identified now, put together and see the possibility of how they can constructively add value to the process that we have on ground at the moment.

Unfortunately, these are all in the deficits. We have deficit in terms of capacity. We have deficit in terms of policies. We have deficit in terms of monetary policies. We have deficit in terms of industrial policies. I just wonder if we will not have a deficit country at the end of the day. We are hoping that there will be a level of  addition into the entire country.

But don't you think that the existence of these three bodies is unnecessary duplication of efforts which might lead to some elements of confusion?

I agree but the fact is that I think you need to also take a look at the various instruments and institutions together with the laws that bring them to place. The reason why budget office itself was put in place is to look at how budget issues are generated from various ministries, departments and agencies (MDAs) put them together before they become a document that can be looked at by the ministry of finance.

So, you will see that there are various attempts by the administration to bridge the divide. Unfortunately, it has also not been practically put in place. When you look at some of these institutions you will discover that some are already created but not properly structured. What we see at the moment in the country is a public service that is nearly comatose and that is why we are beginning to see this kind of output. But the impact is what the country would love to see in the near future.

Your centre was vehement is pushing for better days in the oil sector. Bring me to speed as to what you are doing in that regards at the moment?

For us, we believe that natural resource governance is something that should be given a thorough watch. That is because of the various ills that happen in that particular sector. You have a lot of oil theft that happen there. You have alot of crooked and shoddy deals from various administrations that is going on in that particular sector. For us we thought there is the need to bring transparency and accountability to play in in every matter related thereto. And in doing that, we have been able to drive a network that is letting oil companies publish exactly what they pay in terms of royalty to government and taxes. This is because these are places where you see  plenty dubious activities going on.

As a matter of fact some international oil companies (IOCs) hire finance houses that will help them to duplicate books and put certain records in such a way that they are not very straight. That in itself is a major issue.

We also need to interrogate the number of barrels we take per day. Unfortunately, we don't have that figure. We only take the official figure. The country itself does not have the figure of the barrels they actually extract per day. That is another issue. That is why you see plenty of oil theft and activities that are unorthodox in nature happening. For us it is all about transparency and accountability in that sector so that the host communities should be properly taken care of. There should be a good level of distribution in terms of how everybody gets the national share of what is accrued from it. Of course, there should be a level of increase in what is currently given to oil producing states. These states are suffering alot of neglect, social injustice is happening there; insecurity, livelihoods are badly affected and you see people jobless.

So how do you want to take all these four cardinal principles and disconnect them from insecurity? In order not to have a situation of chaos, we have to interrogate these issues and that is what we are doing at this centre.