Buhari must look beyond PDP, salvage Nigeria – Idris Mikati

(AUTHORITY)  – Lagos-based economist and political analyst Shuaibu Idris Mikati speaks to The AUTHORITY Correspondent JIBRIN MIACHI on the state of the nation, sharply disagreeing with President Muhammadu Buhari’s continuing disparagement of the opposition PDP. He also speaks on the current economic hardship facing the country, offering ideas on the way forward

Almost two years on the saddle, the APC has kept on saying PDP woefully failed the nation. This has generated subsisting controversy within the nation’s political discourse. What is your own position?

It is extremely uncharitable for anybody to come out and say the sixteen years of PDP administration is a monumen­tal failure. To drive the point home, you can’t take it from the national level. You have to take it from what I can call state or kindergarten level. In this case I will just give three or four ex­amples. Let me start with my home state. Whether you like Senator Ahmed Makarfi or not, you will know and agree that during his eight years of administration in Kaduna, we had dividends of democracy. My village Dogondawa never had electricity but during his tenure, we got connected to the national grid.

If I were to go to Dogom­dawa, I need to drive to Zaria and from Zaria, I need to drive another 70 km to my village but Makarfi constructed a road to the place and with that, I could sleep in Kaduna conveniently, drive from Kaduna to go and attend naming ceremony by 07.00am in Dogandowa. With this development, will I say PDP has not done something in Kaduna? The answer is certain­ly no and if I am saying so, then I am being economical with the truth.

In Katsina State, nobody can say that late President Umoru Musa Yar’Adua did not revo­lutionalise Katsina State nor anyone will say that Ibrahim Shehu Shema didn’t do much in Katsina State. Then come to Lagos where I am staying, for­mer Governor Fashola, now a minister, has done much work that brought monumental im­provement to the life of citizens of Lagos State. You could say he wasn’t a member of PDP but he was able to do what he did when PDP was at the centre.

If you go to Rivers State, anybody who is familiar with the level of development in the city called Port-Harcourt, you will know that yes, Barrister Amaechi has done wonderfully well. From bridges to roads net­work he was able to construct and housing development he achieved during his tenure.

You will agree that PDP’s sixteen years of administra­tion was not a waste. Amaechi was even a member of which Party? He was with PDP. In Sokoto State, Aliyu Magata­gada Wamako did marvelously well under the PDP and he was a PDP member. In Bauchi, Ahmed Muazu did extremely well too. If anybody thinks the PDP ruined the country, how? No doubt there were issues and there are still issues even in this government.

For President Buhari to come out and say that sixteen years of PDP in government were years of waste, I think he is not being fair. Leaders and elders, when­ever they want to speak, they should be careful not to make blanket statements. There were periods when the government of PDP did extremely well for Nigeria. I gave you the example of areas that I am extremely fa­miliar with in the North West, North East, South West, and South-South. I am not too familiar with the South East but I am sure, if you go there, you may see where governance has im­proved lives a lot. Now let us go to the centre.

When Obasanjo was in pow­er, who initiated the concept of excess crude account which was meant to save revenue and at a point we had over 10billon dol­lars in excess crude account? It was Obasanjo. Who midwifed the bag of sovereign wealth funds in Nigeria where we to­day have almost 2billion dollars in sovereign wealth funds? It was Obasanjo. When Obasan­jo left in 2007, there was over 60billion dollars in our foreign reserve.

From foreign reserve to ex­cess crude account and sov­ereign wealth fund, we had over 60billion dollars. When we had challenges in 2008 that the economy was about to col­lapse, what saved this country was those savings. Now eight years of Obasanjo is part of the sixteen years of PDP that Presi­dent Buhari allude to the fact that is monumental waste. Now at least my recollection, I am a bit younger, Baba Buhari is old enough to be my grand Pa, not even father but my recollection is showing me that out of the sixteen years, the country did witness some level of improve­ment in about twelve years.

So if we wish to talk about politics, it should be politics of saying the truth, not politics of blanket condemnation. We are no longer contesting elections. You are running government. Do you run government by dis­paraging the past or coming out with policies and programmes that will address what is on ground? In any case, Nigerians knew that there were challenges and that is why they refused to vote PDP back and voted for Buhari because they believed in him and his capacity to address the rot.

Nigeria is in trouble eco­nomically and everybody is looking for a way forward. Putting politics aside, what is the way forward?

You should not generally use the phrase Nigeria is in trouble. I will rather prefer you put it a bit mildly that Nigeria is facing some economic challenges just as we have faced security chal­lenges in the past. In economy, we have about three to four types of recession. The Nige­rian economy is currently in recession. Normally, when an economy is in recession, what do economists term recession? When you have two successive quarters of contraction, mean­ing the Growth Domestic Prod­uct (GDP) after every three months is being measured and when it is measured instead of growth, you see a level of re­duction and then you say the economy in recession.

There is the term called mild recession, there is excessive recession, there is extreme re­cession and there is prolonged recession. What Nigeria is cur­rently facing is what we call mild recession because the reduction in the GDP is just about minus 2.8 or there about. So, you will not say generally that Nigeria is in trouble. We are yet to see that as trouble because in the first instance, we need a situation where we need to measure the recession when it is long.

A recession can be V shaped – meaning it contract and then it picks up. A recession can be L shaped – meaning it contracted and it stays long in one location just contracting, contracting and contracting. It can also be W shaped – meaning it con­tracts, goes up, contracts again and goes up. Lastly, it can be U shaped – meaning going down mildly for a period maybe one or two quarters and then it goes up. Now what we are facing is much likely to going to be a U shaped recession. Therefore, I will not use the phrase prob­lem but rather challenges. And when you are having economic recession, is it something new, abnormal? No, it is not.

Capitalism by its nature posits that you will have some levels of bubble and some lev­els of bust. So, sometimes the economy grows, sometimes it remains stagnant and quite a number of times, it goes a little lower. I think this is the defini­tion that I can give. But what is the way out? I think the jurists are out and everyone is com­ing out with one form of sug­gestion or another. In recent past, the economy of U.S and that of the European countries used the phrase that we recently christened quantitative easing. What is quantitative easing is in times of depression, govern­ment pumps in money, reduces interest rate so that borrowing cost could be low, spending pat­tern could improve.

Instead of hoarding money, we are releasing money so that economic activities can begging to bubble and then the econo­my could grow. But is Nigeria in a position to do that? Your guess is as good as mine. We are experiencing inflation at almost 18 percent. If you significantly reduce interest rate, you are likely going to have a situation where you will have some chal­lenges because that could be a disincentive to saving. When people are not encouraged to save, what happens?

There will not be surplus money to lend to investors or those who need to borrow to do one business or the other. How­ever, I think one or two major policies have been put in place. One is the issue of agriculture. People are going back to agri­culture. Thus therefore, we will be able to address the major is­sue that is affecting us because, remember there are maybe three critical factors that causes this recession.

One is the reduction in oil revenue. By the reduction in oil revenue, Naira/dollar par­ity appears to have significantly changed negatively. We are currently having in the paral­lel market almost N420.00 to 1 dollar as opposed to N200.00. With this, government rev­enue has reduced by almost 60 percent. This is another major issue. Thirdly, we are fighting insecurity internally. From the north east is Boko Haram. How much money is government spending to fight Boko Haram insurgency?

In the South East and South-South, we are having challenges of militants that are blowing pipelines and forcing the coun­try’s ability to produce oil to certain level that we have not seen in the last 15 to 20 years. I think those are some of the things that caused the reces­sion. I think, finally, the body language of Mr. President is an­other factor. In leadership, there are certain actions and inac­tions that you need not to take. There are certain movement or even look that as a leader, you are not supposed to take.

With the current economic recession, foreign investors are not coming, local manufactur­ing concerns are not perform­ing well and so local produc­tion is not enough to meet the demands of Nigerians. What do you suggest?

I think it is a bit difficult to say clearly that foreign inves­tors are trying. This country has not been fortunate enough, even during the PDP regime to get foreign investors, the kind that this economy requires. In the past, what kind of inves­tors were we getting? They were what we call portfolio investors. These are people that come in with what we call hot money. And why do we call hot mon­ey? They come in bring in their dollars, target your stock mar­ket, buy shares, hold the shares, cause artificial scarcity of the shares which results into price increases in the share and when it reaches a certain level, they dump the share and take their money out.

Those were the money that we were getting. This is not the kind of foreign direct invest­ment that a developing econo­my like Nigeria requires. Any­one that is interested in long term investment and in reason­able level of return, he or she may be looking at agriculture, infrastructural sector. After all, look at what we have success­fully been able to achieve with privatized electricity services. From generation to transmis­sion, investment opportunity than electricity generation, distribution and what have you, largely because you have a country where average national daily demand for electricity is in the region of between fifteen to twenty thousand megawatts per day.

What we are producing to­day is less than 6000 mw in­stalled capacity, production is less than 4000mw. Now, look at the difference between the de­mand and supply. Can anyone be wrong to bring in money and invest in this sector? If truly and sincerely White men and women are desirous of helping Nigeria, this is the kind of area they should come in and in­vest for long term, not for short term. Secondly, look at our road infrastructure from motor ve­hicle roads to railway. Today we are celebrating shamelessly of movement of cow from Kano to Lagos by train. Imagine a serious investor from China, Japan, U.S or even India com­ing to invest like 5billion dollars to develop rail line with a target that they will be here for fifteen to twenty years.

I bet you, in the next fifteen to twenty years, that 5billion dollars could be 25billion dol­lars because of the enormous opportunities. Take the Hous­ing deficit we have. I can con­tinue without an end. Those are strategic investment that foreign direct investments and investors should target as op­pose to targeting stock market. I think those are the solutions. Unless we look towards that, we may never be able to say we have an economy that is fairly balanced.

Today in Nigeria people don’t have enough food to eat because of inflation and the opportunity for them to make money and raise their purchas­ing power has reduced. What do you think government should do to address the prob­lem of hunger in the land?

I sincerely believe that the very best any government can do is in the angle of policy. The policy has to be right and if need be, put some levels of incentives so that people can be attracted to go back to farm and be self-sufficient in food production. When people talk about the high price of foodstuff, I laugh because we the elites are the one complaining that rice is expen­sive. Rice that used to be sold between N7000 and N9000 is now N20000 and everybody is crying. If you listen to the hue and cry of the people on the street, you ask yourself. Here in Kaduna town, let us assume we have 2.5million population in Kaduna, out of this population figure, can you really tell me that 500000 people cry daily?

The answer is no. What is the percentage of the popula­tion that eat rice, foreign rice? Maybe 10percent. Now, 10per­cent of the population are hav­ing challenges because it is too expensive. And because they have relationship with you, the pressmen, the hue and cry is so loud and deafening that you will think the entire population is dying.

Meanwhile, 80percent or 90percent of the population never get to eat rice. And eve­rybody is complaining that Buhari has closed borders, where and how will you see an economy that will survive with smuggling? Nobody said you shouldn’t bring in rice. Rice is not a banned commodity. It is allowed to be brought in but all the government is say­ing is bring it through a chan­nel that you will pay the right duty so that we could take pip-born water, electricity to the nook and cranny, and so that we could have protective envi­ronment as well as protecting the home-grown food like the rice being grown in Abakiliki, Badegi in Niger state, Kebbi, Nassarawa among other plac­es in the country so that our farmers could extract value for their sweat.

If you are a farmer and you grow one bag of rice, for ex­ample, it comes to your house at N10, 000, if the market is selling at N9, 000, will you be happy? The answer is no. What will make you happy is when the rice is being sold maybe at N12, 000. This pro­tectorate policy will make you extract value for your sweat as you will not only be recouping your investment but making a small profit. Now, if we should allow everybody to bring in anything without rules and regulation, what we will have is a collapse economy com­pletely. What we need to do now is to provide enabling environment that will make Nigerians to go back to farm and this should be seen in the provision of farm inputs such as pesticides, fertilizers, and highbred seed at affordable prices and timely.

The enabling environment includes security. In Kaduna today, it is practically impos­sible for farmers to go to farm for security reason. For more than one year, I can’t go to my farm because of the level of kidnapping. There is no en­vironment good enough to make me to grow my asset. Secondly, the input, this gov­ernment has failed woefully because they did promise to give fertilizers at reasonable prices but they never did. Government should initiate a policy that can give what I call safety net – guaranteed mini­mum price.

Given the prevailing situa­tion, will you support the call to flooding market with stable foods in every home, particu­larly the rice?

I don’t think it will be fair to say rice is a stable com­modity. Rice is one of the few foods that we eat in the north. The commonest meal you will come across is maize or sor­ghum or both. If you take the census of northern household, you will discover that 95per­cent of the household lives on sorghum and maize. Why must we flood the northern market with rice just because we want to address concern of 5percent of the population? It doesn’t make sense.

If you go across the Niger, from the East to the West, what they eat is either gari which is eba or amala, fufu or pounded yam. Whether you are from the South-South, East or South West, there is no part that I haven’t being to and lived. I know their common foods. How many eat rice there? Maybe 15percent of the population eat rice. 85percent lives on gari or fufu which is from cassava, panded yam which is from yam.

Why then do we need to bother about what 15percent of the population are suffering from, to flood the market? Re­member that when you flood the market you will force down market prices of foreign rice and those who can afford will go and buy at the expense of the Nigerian farmers. So, you do you want to kill 95percent of your population so that the 5percent can survive? Is that leadership? I think we need to be a little careful. I will not sup­port flooding market with rice because we are not in the situa­tion of famine.

S0urce: Authority