A little knowledge is a dangerous thing, so goes a famous line by Alexander Pope, the 18th Century English poet. Today, postulations and positions being taken on the fate of the Nigerian economy make this seemingly simple line very, very relevant indeed. You see, when selected information is left in the hands of someone without an inquiring mind, she tends to make decisions based on these limited sets of facts and, if passionate enough, erroneously defends it to the death. The observance of tunnel vision in action may be amusing when arguing for leisure. But when these people are in charge of the destiny of over 160 million people, it takes on a very worrying turn.
Unfortunately, the current situation in the country has necessitated a revisit of the fuel subsidy ‘solution’ offered to the Government on this post a couple of weeks ago. Its numerous ‘think tanks’ obviously did not have anyone within its nebulous committees that thought of the most important deficit in our economy, and country today: trust. Whether the economic reasons proffered are accurate or not, the inability or, more precisely put, the unwillingness of those that lead to identify with those that are being led indicates a very big gap in their consciousness of a sense of affinity with the people that have ‘entrusted’ them with this mantle. But these posts are primarily for the purpose of debating economic thought and, as much as possible, will stay on that path.
At various forums, key economic leaders in the Nigerian Government have, tongue in cheek, indicated why the fuel subsidy removal is the ONLY approach to driving the economy towards sustained growth and development. They have alluded to the fact that, among other things, the fuel subsidy accounts for a very significant proportion of the country’s spending. Because of the dubious numbers and the lack of faith in their ability to provide information to support their positions, we will not quote any statistical data here. For, to quote another famous line: there are three types of lies – lies, damned lies and statistics. They have excelled on all fronts in this matter as, not only have they succeeded in picking information to suit their argument, they have confused and alienated the man on the street; the man they claim they want to save.
First it was the story of the cabal sucking our nation dry. The list of all importers of petroleum products was published and we, the angry public, did not hesitate to pillory these money-grabbing corporations for draining our country of its resources. What they did not tell us was that some companies on the list are legitimate importers of petroleum products and had passed the guidelines put in place by regulatory authorities. What they did not tell us was the reason why the list swelled from single digits to over a hundred within a short space of time, and if this increase was backed up with the requisite infrastructure needed to become a member of this ‘cabal’. Did the initial companies have capacity constraints or were not able to justify their import quotas? The people are not that thick, and a bit more information will prevent us from reaching our own conclusions from the sparse tidbits you feed us with.
Then came the job creation argument: deregulation will herald more jobs for the Nigerian population. An articulate Government would have indicated where exactly these jobs will be coming from. What are the direct job creation benefits that have been foreseen? Will they come from the numerous small scale businesses which are consumer-based, and are thus very susceptible to very elastic demand profiles, that will be forced to shut down because people will alter consumption patterns? Did you really think this through before you made the argument? Because of the poor infrastructure situation, many legitimate businesses do not manufacture and, where they do, the processes are kept at such basic levels that it becomes difficult to remain competitive along the lines of quality AND price. You now choose to increase competitive disadvantage? What kind of skill levels are required to take advantage of this promised job explosion, and have we begun to put plans in place to equip them to grab such opportunity? You probably have no answers because you haven’t thought about them. Well, maybe you did because it seems the mass transit initiative for the NURTW was very laudable indeed: continue to empower those with the monopoly of civil fear; they will be useful when the elections come up once again. And who supplied these buses?
There will be no savings from the fuel subsidy removal; the 2012 budget notes, and rationale for implementing the subsidy removal in January indicate that much – there are no provisions for the subsidy in the budget. At least we do not think so till you show us the total recurrent vs. capital expenditure for the 2009, 2010 and, where possible, the 2011 fiscal years. Recurrent expenditure is still over 70% of the 2012 budget, unless the subsidy was not included in earlier budgets. How have the subsidies been paid, and accounted, for? What kind of deficits have we racked up as a direct result of the fuel subsidy? The Subsidy Removal and Empowerment Plan (SURE) programme you have initiated is a clone of many other such plans/bodies. We still remember the Directorate for Food, Roads and Rural Infrastructure (DFFRI) and the Petroleum Development Trust Fund (PDTF), among others. How is SURE different from these bodies and why is a separate institution required to meet our basic needs once a gap has been identified? Empower existing institutions to do what they ought to do. Unless SURE is a smokescreen, of course.
Now that you have indirectly told us that it is the fuel subsidy that has prevented roads, bridges and other key infrastructure projects from being built/completed, we would also like to know what happened to all the contracts approved by the FEC since the dawn of democracy. The list is too long to mention but weren’t capital votes made available for these projects before they were announced? Or did the hoodwinking act start from that time? Should we be looking for a construction/contractor cabal too? You see, full disclosure is required for you to gain our sympathy, let alone understanding and acceptance. And you’re not doing a very good job of that at the moment. We should know, because the people are no longer smiling.
