Nigeria in Decline: Dashed Hopes, HSBC and Presidential Melee – By ThankGod Ukachukwu
A review of news pertaining to Nigeria in leading international media depicts that all is not well with Nigeria, a country in decline and in need of redemption. On the pages of New York Times, DW Germany, The Guardian UK, The Economist, Financial Times of UK, CNN, basically all major Western mainstream media with articles on Nigeria. Top on the list is insecurity and more recently the economy has taken front burners. In September 2018, Nigerians became aware of a report by a multinational banking and financial services company HSBC released in July 2018.
The HSBC country report on the state of Nigeria’s economy started out acknowledging the positive impact of recent higher oil prices on Nigeria’s macro outlook, improved export earnings, supply of foreign exchange and NGN stability. However it noted, “these gains merely mask the economy’s unresolved structural shortcomings”. It concluded that a “second term for Mr. Buhari raises the risk of limited economic progress and further fiscal deterioration”. The preceding proposition was the sour note, which rattled the Buhari administration, triggered a panic attack and elicited the presidency to go on offensive against HSBC. Suffix it to note that Economic Intelligence Unit (a research unit of The Economist) also released an outlook on the 2019 presidential election in which it predicted the PDP would be victorious given the waning popularity of President Buhari largely due to the decline in the economy and inability to deliver on his campaign promises. In retrospect, these organisations endorsed Buhari prior to 2015 election when he had the semblance of a leader who will bring succor to the masses and consequently progress to Nigeria.
It is worthwhile examining the issues raised in the HSBC report before evaluating Nigerian presidency’s response in context. The report noted how joblessness has been on the upward trajectory and has risen three fold in three years. According to data from National Bureau of Statistics (NBS) over 7.9 million have lost their jobs since 2015. HSBC noted that “joblessness has been rising rapidly, up almost three-fold over the past three years, with headline unemployment sitting at 18.8% as of Q3 2017, and one in three youths without work”. The report also highlighted that the number of poor Nigerians have been pushed up to 87 million Nigerians as reported by the World Economic Forum and Brookings Institution.
Nigeria is still paying fuel subsidy after it was purportedly discontinued and over one trillion naira will be utilized in 2018 alone, about 20% of 2017’s gross oil revenue. Doing Business in Nigeria despite recent efforts by VP Osinbajo is bogged down by “inadequate infrastructure, corruption, an inefficient government bureaucracy and policy instability”. It elucidated that IMF argued in its 2018 Article IV report, that “a large infrastructure gap, high gender and income inequality, pervasive corruption, low financial inclusion, and the ongoing humanitarian crisis in the North East (Nigeria) remain continuous concerns”. It also outlined that Nigeria has considerable debt levels and the national debt has grown at outrageous rate with the Buhari administration adding N11 trillion to national debt bringing total debt stock to N23 trillion according to DMO. The major problem is debt service costs, which drains annual budget up to 25%, and while the debts may be manageable in the near term, the economy is left vulnerable to future fluctuation in oil prices.
They observed that the issues raised have put Buhari’s approval ratings at an all time low as Nigeria recover from the excruciating recession in 2016–17 with “sustained economic hardship that has accompanied his presidency, including rapidly rising joblessness, and poverty”. While these reports focused on the economy. It is no longer news that Nigeria has 10 million children of school age out of school. Ranks 152nd out of 188 countries in the Human Development Index of the United Nations Development Program, and 187 out of 189 countries in the World Health Organisation rankings of national health care systems
Nigeria still oscillates around 5,000 megawatts power generation for estimated 190 million population while South Africa with less than 60 million people have 40,000 megawatts.
As characteristic of Buhari administration since coming to power, anybody or entity which points out its shortcomings is accused of corruption by its agents and supporters. Predictably, the presidency released a response in which it outlined what it called “grand corruption” of HSBC alleging that it aided and abetted looting of Nigeria’s resources in the days of Sani Abacha. Went on to demand the return of $100 million, which the bank allegedly helped, laundered for Abacha. The contradiction in the presidency’s press release is that it is public knowledge that Buhari has in the past given Abacha a clean bill of health and absolved him of looting Nigeria’s resources and once talked about the roads and hospitals Abacha built as alibi for his continued veneration of the tyrant who plundered and looted our commonwealth. Similarly, the anti-corruption agency EFCC corroborated the presidency’s statement and vowed they won’t rest until all our monies are returned by HSBC accusing it of being a global bank renowned for money laundering.
Considering the issues raised by HSBC, one would realize how indefensible they are no wonder the government resorted to mud-slinging and squabbles with the bank. Just like nagging individuals’ vituperations, vitriol and tantrums, an attempt to attack the credibility of the bank without addressing any of the issues at stake. How would investors that take advice from banks like HSBC view Nigeria when its leadership could not muster a logical reply but went about casting aspersion on HSBC like husband and wife quarrelling over house chores and sibling quarrelling over errands?
The antics of the presidency remind us of the last kick of a dying horse. Reminiscent of its antagonistic and acrimonious approach in dealing with opposition parties, Buhari administration resorted to appealing to the fervour of patriotic citizens to rally them against imperialists and doomsday naysayers in a sudden anti-western and Afrocentric rhetoric contrary to its courting of Western countries and institutions for support in the early days of the administration. The response to HSBC and EIU reports is a flagrant display of mendacity aimed at obfuscating facts and diverting attention to inanities, which it has deployed since 2015 to keep the Nigerian public in perpetual ignorance of its failure to deliver good governance.
Finally, it is pertinent to note that the Buhari administration did not in any way address the issues raised by these reports rather it plunged headlong into a melee with these organisations. The issues raised are well known to Nigerians and have been highlighted by thousands of Nigeria on social, news and print media. The only difference is that international organisations have substantiated them with detailed and well-researched reports from a global perspective. As stated by HSBC, a “second term for Mr. Buhari raises the risk of limited economic progress and further fiscal deterioration.” That is the issue at stake and what Nigerians should consider!
ThankGod Ukachukwu (@kcnaija) IT Consultant and Current Affairs Analyst writes from Lagos.
Follow us on Twitter at @thesignalng
Copyright 2018 SIGNAL. Permission to use portions of this article is granted provided appropriate credits are given to www.signalng.com and other relevant sources.