President Muhammadu Buhari has only one economic management model: borrowing. This late in the life of his administration, he sees nothing wrong with putting more burden on the weak and run-down economy he will be bequeathing to the next federal administration. He has asked the senate to approve his new loan request of $800 million. As bad an idea as they come.
He told the lawmakers in his letter that he wants to use the money to scale up the National Safety Net Programme, a programme ostensibly designed to assist poor and vulnerable Nigerians in coping with the consequences of his poor management of the economy in his eight years in office. But this is not about the poor and the vulnerable. It is about a man floating down the current of history and trying to catch at the empathic straw of the poor.
If Buhari cared that much about the low and the lowly on the economic scale, he would have used his time in office more productively to expand economic opportunities for the poor. Instead, his economic policies have seen an astronomical increase in the number of the poor. The last someone checked there were 138 million of them in the fifth crude oil producing country in the world.
The senate will help him pile it on. It is no use trying to persuade the distinguished men and women in the upper chambers of the national assembly to reject the request with a loud rebuke to the president because it is its obedient duty to say yes to him. It has never questioned, let alone rejected, the series of loan requests by the president through which the administration accumulated the crushing burden of N77 trillion on the weak and mismanaged economy and the nation.
Buhari developed the unusual taste for jumbo loans in December 2016, when he first sought $30 billion loan from either the World Bank/IMF or the Chinese do-gooders with deep pockets. This and the subsequent jumbo loans did not save the economy from going down the unwanted path of recession twice under his watch. His latest request before the senate is cynical, in bad taste and unfair to the incoming federal administration now caught in the web of poor luck of cleaning up the huge mess the president is leaving behind.
He does not seem to care, as The Punch pointed out in its editorial of April 28, 2023, that his era has “…witnessed a relentless surge in human misery, rising national debt, two recessions, record unemployment and inflation levels, and receding foreign direct investment. While some much had been expected of him, he delivered eight locust years.”
In case the president and his economic managers have not heard, the Debt Management Office warned in March that the country was “fast exceeding its borrowing limit.” It is possible that it has done so already under Buhari, a man who was critical of the management of the national economy under all governments before him. Under him, our economy has hit the bottom.
Nigeria is back where it was when the Obasanjo administration successfully negotiated the forgiveness of part of its debts with the Paris Club. Buhari has taken us back. When a rich but poor country is catching at the straws of survival, borrowing offers itself as the only option available to it to survive. It is not, of course. A country may ditch Shakespeare’s advice: neither a lender nor a borrower be, but it cannot escape the consequences that are bitter. No nation has ever developed with other people’s money. The easy resort to borrowing stifles creative and resourceful responses to the challenges of managing poverty. It places an unwanted burden on the future of the country just as it mortgages that future to a gaggle of lenders.
When he took the first jumbo loan, Buhari justified it on the grounds that our infrastructural decay had impoverished us. It was easy to appreciate that. Our epileptic power supply had forced some giant foreign manufacturing industries to relocate to other African countries. Michelin closed its shop and moved to Ghana. I can think of no one who disagreed with Buhari on his avowed intention to rebuild our infrastructure and open up the economy to the creative energies of fellow Nigerians. Still, we knew the $30 billion jumbo loan was a bad idea – and many of us said so and asked the president to reconsider it and explore some practical ways, or as President Ibrahim Babangida would say, home-grown alternatives to reviving our infrastructure without the jumbo loan.
There had been no stopping the president and his economic managers ever since because they were sold on the bad idea that if a country is marginally credit worthy, it is wise to borrow. The jumbo loan opened the floodgates to other loans. I cannot think of Buhari’s loans without remembering that in announcing the coup that brought Buhari to power on December 31, 1983, the late Brigadier (later General) Sani Abacha, said that Nigeria had “…become a debtor and a beggar nation.”
Our economic situation, despite the truth spinners, is worse now than it was under Shagari’s watch. Whoever takes over from Buhari inherits a run-down economy and a heavy debt burden. It is no mean challenge and no one in the in-coming administration must entertain the luxury of thinking that there can be a quick fix here. The economy needs much more than massagers and massaging.
The country, for which read the poor and the vulnerable, is still reeling from Buhari’s disastrous Naira redesign policy that imposed withdrawal limits on individuals. It ruined thousands of small businesses and destabilised the informal sector, the real engine that has always driven our economic growth. I thought he would spend the rest of his time on the throne making amends to the people whose lives and businesses he ruined through the imposition of a vengeful political policy that ill-served the economy and the people and left the poor poorer and the vulnerable more vulnerable.
Buhari has obtained another loan to distribute money to 50 million Nigerians to cushion them against the effects of fuel subsidy removal. Remember that the courage failed him each time he set a deadline for the removal of subsidies. Once more, it is money down the drain. It will only benefit a gaggle of consultants and ill-serve the target group.
I have always argued, and still argue, that the idea that the creative and resourceful Nigerians need government handouts to survive is a political absurdity wrapped in faux but assumed political popularity. Nigerians need an economic system that gives them the opportunities to teach themselves how to fish rather than eat fish. They need infrastructural facilities such as constant power supply to run their small businesses. And they need security so that the woman roasting yams or corns by the roadside can enjoy her level of entrepreneurship in peace and security.
Successive governments have disappointed them. Occasional pretend policies for helping the poor and the vulnerable are mere political sound bites misguided in conception and deceitful in intent. I had always thought that Buhari would be one Nigerian president who would be unimpressed with populism. I am wrong here as I have been elsewhere with the policies of this administration. Sorry.
The new president certainly has his own ideas about the management of the economy. I fear that whatever plans he has may face the risk of being frustrated by the urgent need to put the economy back on its feet. It will not take hours or days. It will take months. In 1984, Buhari cautioned fellow Nigerians not to expect that the economy would be magically fixed in one day and the salary and pension arrears cleared in no time. Our next president should take due note of that and restrain himself from believing he is the new economic magician on the throne.
