Month: April 2011
I am simply at a loss of words or the appropriate adjectives to describe my state of my mind over the past few days, or to be more candid since the Nigerian Presidential elections on the 16th of April. I was massively disappointed at the outcome and its aftermath that for the whole of last week I was in a near state of depression. It was even difficult to focus on my course work or essays, I was just thinking of Nigeria. At a point I started wondering if there was something wrong with me, if I was over-reacting or if I should simply stop following the news coverage about Nigeria – which of course is not possible. Being the typical female, I thought of getting in touch with my feminine side and doing something that lifts the spirits of most women – going on a therapeutic shopping trip to Birmingham city center, but not even that made me feel better. Then I spoke with several friends here in the UK and back home and I found out that indeed I wasn’t the only one feeling that overwhelming sense of frustration and helplessness which I can sufficiently summarize as an admixture of gross disappointment; shock and anger; despair and hopelessness as I shall explain briefly.
It should be pretty obvious where my disappointment stems from. As a supporter of the main opposition candidate General Muhammadu Buhari of the Congress for Progressive Change (CPC), his loss shattered the dreams and vision many of us envisaged for a new Nigeria. For in General Buhari who had a fervent, populous and massive grassroots support probably comparable to that of Brazil’s former President Lula Da Silva of Brazil; some of us saw in him a man who would combat the cankerworm of corruption, an obstacle to any meaningful development; would free Nigeria from the shackles of the few elite/cabal that have held it to ransom for the past few decades; would restore discipline, law and order to a very disorganized and increasingly undisciplined Nigerian society and would provide the critically needed infrastructure but alas that is not the case. Notwithstanding the allegations of vote rigging, result manipulation, money inducement to vote for the ruling party, it is absolutely incredulous that some people actually voted not for change that Nigerians are in desperate need of, but voted to maintain and perpetuate the status-quo. While it is almost a generally accepted fact that the ruling PDP-led government in the last 12 years of democratic rule has recorded abysmal performance at virtually all tiers of governance such that the Nigerian state is now bedeviled by decaying infrastructure – electricity supply has actually worsened in the past 12 years; rising insecurity – prior to 1999, many Nigerians save those who watch blockbuster American movies were not familiar with the terms kidnapping or bomb attacks but these are now almost regular features of Nigerian life; soaring unemployment levels – any recruitment exercise attracts hundreds of thousands of applicants – in this case, I can vividly recall sometime last year, 68 vacancies were posted for the Federal Capital Territory Administration, yet more than one million people applied for these 68 vacancies!!! It is simply incredible that people decided to forfeit this momentous opportunity for change from the status-quo based on the naïve assumption that they “voted for individuals and not parties”. Ha! Pray, did any of the candidates run as an independent or on the platform of a political party? As the latter is the case, how do you divorce an individual from the people and whatever his party stands for?
From this, the feeling of shock and anger took over – I still cannot distinguish one from the other at this point because they seem intertwined. As the results of the Presidential elections were announced state by state, it became increasingly clear that where people voted and the votes actually counted, people did so for the most part based on religious, regional and ethnic sentiments. The incumbent President Jonathan was overwhelmingly voted in the mainly Christian-South while his main rival Buhari was overwhelmingly voted in the mainly Muslim-North. Once more, all allegations of rigging and manipulation set aside, in the end Jonathan polled in more votes. However the shock/anger stems from not just the realization that people had retreated into their ethno-religious cum regional enclaves but that the elections had decisively split Nigerians into a North/South divide, what many had feared for years. The elections just laid bare the deep-seated cleavages and divisions between Nigerians and this is everywhere – from cyberspace – online news and social media – Facebook and Twitter to normal face to face interactions; the print media and even government offices. All of a sudden it has become an Us vs. Them scenario with one side jubilating over and celebrating its “triumph” over the other and so many cyber warriors on both sides attacking one another. Infact, in various online Nigerian forums, you have to take a side and to be very candid, the Goodluck Jonathan army is more vociferous, vocal and aggressive because– if you criticize or express any form of displeasure against President Goodluck, you are regarded as an enemy, forgetting that we CONSTITUTIONALLY operate a MULTI-PARTY DEMOCRACY where such dissent whether from individuals, groups or media is actually healthy for the whole system otherwise the steady descent towards fascism becomes inevitable.
The second part of my shock/anger was that as if all these things were not bad, depressing or infuriating enough came the eruption of unrest in various parts of the North – Buhari’s “stronghold”. What started off as a “protest” quickly became violent and took a deadly religious dimension with innocent lives tragically wasted away particularly of Youth Corps members dutifully serving the Nigerian state. So far there are 3 schools of thought explaining the outbreak of violence: (i) the protests started off peacefully against perceived “betrayal” by the Northern elite and eventually became hijacked by miscreants who unleashed attacks on innocent people; (ii) The protesters were all along blood-thirsty criminals with no regard for human life who were just out to spill blood of the innocents, and (iii) The protests were neither religious nor ethnic but were purely political covertly instigated by the ruling PDP to cause mayhem and unrest in the North and provide a distraction. Well, you can choose which school of thought you want to believe but the loss of lives and property is most unfortunate. All these have together made people spew all sorts of unbelievably hateful, vile comments most unbefitting of nationales of a country that is supposedly the most “religious” nation on earth. As Nigeria increasingly becomes dangerously divided, so has the mudslinging with hateful ammo intensified with such vigour all over cyberspace. I know the number of people on my Facebook friends list that I have fought with or argued with because I told them to tone-down their offensive language.
With all this is a feeling of pure hopelessness and despair over the bleak future that lies ahead. I believe even the cyber warriors on both sides, if only they would take a step-back from all the mudslinging and ponder over the tumultuous and uncertain future that lies ahead would feel a sense of dread. The same set of people within the same party that has brought Nigeria practically to its knees has been recycled back in power, yet we somehow expect different results. To be very frank, I am scared – in all of my 20something years on earth I have never been filled with so much dread such as I am at this point. As the elections have exposed the deep and possibly irreconcilable cleavages and fracture within the Nigerian populace, I have found myself pondering over the future of the Nigerian state with my mind recalling the US National Intelligence Council report in March 2005 that Nigeria could collapse in a few years. The persistent call for division of Nigeria by the separatists and irredentists particularly on the internet is not helping matters either. The whole atmosphere is tense, charged and thick with flammable haze of anger, suspicion, fear, uncertainty and distrust that one spark will set of an explosion of such magnitude never seen before. John Campbell warned in his book Dancing on the Brink that these elections could make or mar Nigeria’s future as a nation-state or whether it would collapse but he was dismissed by the Media and policy-makers as a harbinger of bad news or even the grim-reaper of whatever fractious peace we have.
At this point, it has reached such a stage that practically everyone in Nigeria is waiting for a miracle – from the teeming, almost fanatic legion of President Goodluck’s most ardent supporters who expect him to miraculously divorce himself from the PDP cabal, capones and godfathers and perform well; the disillusioned opposition who with their lack of an organized party structure are still relying on a miracle to sweep the just concluded gubernatorial polls or the Nigerian masses having for long been disillusioned with the Nigerian state and despite selling their franchise in some cases for as little as N500 (about $3) are as always hoping and praying for a miracle out of misery and destitution. Well, coming from this “religiously” charged environment myself, at this point I will also assume the same fatalistic position, pray for a miracle and hope that President Goodluck Jonathan performs beyond expectations and by so doing, his good luck would spread around and heal this deep fracture within the Nigerian polity and society, otherwise it will be bad luck to Nigeria in all ramifications.
In the meantime, I hope Nigerians; particularly the cyber warriors will bear these wise and timeless words in mind:
“So powerful is the light of unity that it can illuminate the whole earth”
– Baha’u’llah 1817 – 1892
“Unity without verity is no better than conspiracy”
- JohnTrapp 1601-1669
To say that Nigeria is in the grip of election fever is the biggest understatement yet. I think it is safe to say that the nation is completely enveloped in election-mania and for good reason. As the most populous black nation on earth and Africa’s biggest ‘democracy’ indeed all eyes are on Nigeria as it prepares for the Presidential elections on tomorrow, Saturday 16th April. The stakes are no doubt high for everyone – the opposition, the PDP led government, the electoral body – Independent Electoral Commission of Nigeria (INEC) and the electorate/citizens. These elections which will produce the next President are extremely crucial as they will make or mar, would determine the path Nigeria will take in the next several years or decades.
For the opposition of which the leading contenders are General Muhammadu Buhari of the Congress for Progressive Change (CPC), Nuhu Ribadu of the Action Congress of Nigeria (ACN) and to a lesser extent Ibrahim Shekarau of the All Nigeria People’s Congress (ANPP), the main objective is to unseat the ruling People’s Democratic Party (PDP, or Poverty Development Party as many Nigerians choose to call it these days) and dismantle its hegemonic stranglehold of money and garrison politics in Nigeria. The onus on the opposition now as it has been for several months is to unite under a front and coalition produce a single candidate which can effectively challenge the ruling PDP. Despite several attempts to that effect the last one being sometime last Wednesday the alliance talks have collapsed on several attempts ranging from conflicting interests of candidates and party members and even subversive activities, inability of some candidates to set-aside their personal ambitions for collective interest to allegations of sabotage perpetrated by some opposition members and even by members of the ruling PDP. The reality is that even the Muhammadu Buhari, the candidate with the strongest support base and the best prospects of defeating the incumbent President Goodluck Jonathan in a free and fair election has a slim chance of doing so with other candidates in the picture. The alliance would go a long way in boosting his support base, and which probably explains why it is likely that the PDP actually did sabotage alliance talks as it is reported to have spent over N107billion ($700million) to that effect.
For the ruling PDP, the main issue is to use whatever means necessary at its disposal to maintain the status-quo – its firm grip on power. As the Wikileaks cable on Nigeria revealed recently in NEXT newspapers the PDP is but a fractious, loose coalition of opportunistic interests who have no ideology or vision but are united by a common objective nay desire to have access to state resources to feed their insatiable greed, their cronies and intensive patronage networks. With the fact that in the past 12 years of “democratic” rule there has been continuous and systematic infrastructural decay – power, water, health care, education you name it; rising insecurity; unemployment; religious and communal strife and institutionalization of corruption in short poor governance at all levels, the party has proven to be hugely unpopular amongst the citizenry. Its support base lies in its massive patronage networks of those in power, their beneficiaries, their allies and cronies oiled by money and resources from state coffers which is of course why they are desperate to maintain their hold on power. In the past several weeks the campaign team of the incumbent President was reported to have spent over N100million ($650,000) per day. In the wake of the relative and unexpected defeat the party suffered in the parliamentary elections last week Saturday despite the wide electoral malpractices and rigging tactics it was alleged to have conducted, you can be sure that the PDP is re-strategizing its rigging tactics and would not spare any means fair or foul to attain that objective. This is evidence of electoral fraud in a polling station last week, kudos to the brave Nigerian who captured this on video:
For the electoral body, the onus is on Attahiru Jega, the INEC chairman to deliver credible elections in the midst of a logistical nightmare and against all odds. As Jonnie Carson, US Assistant Secretary of State on African Affairs rightly pointed out, Jega his integrity, reputation and competence notwithstanding is only one man in the face of “significant systemic and logistical challenges” who might not be able to do much in a system where the political culture is characterized by money politics, a culture of impunity and manipulation of the electoral system. However, Jega’s actions in the past few months gives hope and solace on his ability to deliver relatively fair elections despite all the odds. Even last week’s parliamentary elections which were not devoid of hitches, rigging and malpractices in several states of the federation were a marked improvement from previous elections conducted under the tenure of the widely discredited and deluded Maurice Iwu who was widely acknowledged to have conducted the worst elections in Nigeria’s history. Jega inspires hope and we are relying on his dogged determination, steadfastness, discipline and competence to conduct credible elections.
Lastly and most importantly, the power to influence the direction this country heads towards at this point lies with you and me, the electorate. The person we vote for on Saturday, in this landmark and decisive elections in our nation’s history is of utmost importance. It is rather simple, if you are happy with the status-quo, the way things have been in the last 12 years – the decaying infrastructure; the rising crime levels – kidnapping, armed robbery, assassinations; the rising unemployment; abhorrent levels of corruption at all levels of government; the impunity and lack of accountability of leaders and the general sorry state of affairs, then by all means vote for the PDP and Goodluck Jonathan and let us continue to wallow in misery. If you want to give change a chance, if you want to secure the future of this generation and our children’s future, want to see Nigeria take its rightful place in the comity of nations, want to see our public schools and hospitals back to functional states; then you know who is symbolic of that change, who has the massive grassroots support and appeal, who has not based his politics on money, oppression, falsehood or intimidation and that person is General Muhammadu Buhari.
In a nutshell, the stakes are high for all those involved in Saturday’s elections – the opposition, the PDP-led government, INEC and the electorate. No doubt this is a decisive moment in our nation’s history and change is imminent but the person elected or “selected” as President will determine what direction that change takes – positively or negatively. It is a moment to either choose to change the status-quo or the alternative which not only maintains the status-quo but aggravates the systemic decay in Nigeria which will ultimately not bode well for anyone. This is literally as Sonala Olumhense so rightly stated, the vote of our lives.
And on a final note fellow Nigerians, as you ponder over the elections tomorrow, remember the “wise” words of one of the most “interesting” orators of modern Nigeria, Dame Patience Jonathan: “Where are you going to press ya hand…?” You know what that means. Think well, vote wisely and protect those precious votes fiercely until results are announced!!
It feels like ages since I last posted anything. Amidst tight schedules and deadlines for my coursework, a brief visit to Nigeria, a bout of the flu, it seems the past few weeks have gone by in almost a blur. In the fast-paced and dynamic world we live in so many things keep happening at such a dizzying pace – from the turmoil, civil-war, Western intervention folly in Libya; the political turmoil and madness in Cote d’Ivoire and the botched Nigerian parliamentary elections; to the earthquake in Japan, Sylvio Berlusconi’s salacious sexcapades’ scandal, the crash of the Portuguese economy and oh! Not to forget, the forthcoming royal wedding of Prince William and Kate Middleton. What a world we live in! And in all of that, I have chosen today (to my own uttermost surprise) to commend the Nigerian government today vis-à-vis the West. Surprise, surprise! Wait! Before you dismiss this as one of those clichéd anti-imperialism, anti-neocolonialism rants, it is far from that actually.
As you might have heard, or read about, the Portuguese economy has taken a nose dive and is on the verge of collapse. The country now requires financial assistance from the European Union (EU) and the IMF possibly. It is the third country in the EU following Greece and Ireland within the last one year to be bogged down by deficit, requiring financial assistance and now there are fears that that Spain might be next and that the crisis might spread to other countries. The main point I am trying to make is that this is very much connected to the 2008 global financial crisis, the global economic crisis, the credit crunch, the economic downturn or whatever fancy name it is called. This financial crisis started in the USA, in the subprime mortgage sector, then it quickly spread to other sectors of the economy and before you could say Forex, dollars and pounds, it had spread to other parts of the developed world and even certain parts of the developing world. You are now wondering what all this has to do with me commending the Nigerian government right? Do tarry a little, I will get to that shortly. But before that, let us take a little trip down memory lane…
The global financial crisis which started in the US subprime mortgage industry and the financial sector was able to spread to other sectors of the economy and other parts of the world because different types of financial institutions performing different types of activities had become so interconnected with one another within and between countries. For example banks, the chief culprits performed all sorts of functions – a single bank was engaged in commercial banking (deposit and lend services), mortgage banking and investment and speculative banking (the abracadabra in currency and stock markets). In short they were mega banks (to all Nigerians, does this sound familiar?). In addition, there were shadow banks – such as hedge funds – which performed the functions of all these banks and more, but were not regarded as banks and as such they were not regulated as such, and in fact, some people are of the opinion that shadow banks were designed to elude regulation.
All this sounds pretty confusing and it is, because normal people hardly know what these bankers are up to. As for subprime mortgage, as the name suggests, it entailed giving mortgage loans to people who ordinarily would not qualify for these loans and who do not have to demonstrate their credit-worthiness. These loans were called “Ninja” loans – No Income No jobs No Assets – and the loans were repackaged and sold on several times (how do you sell a loan??) to other institutions in the US and around the world because with globalization, financial institutions and financial markets had become transnational and interconnected (that is the role of stock markets). Therefore when few people defaulted on their mortgages in Florida in 2008 it had a domino effect on a system that was essentially an air bubble waiting to burst.
In Nigeria, a few years ago, Professor Charles Soludo, the immediate former Central Bank (CBN) Governor pushed for and implemented banking reforms that created “Mega” banks by forcing banks hitherto operating to recapitalize and ensure they had a minimum capital of N25billion ($160 minimum roughly). Notwithstanding the fact that many “small” banks that catered to small communities closed down because they could not raise the required capital, the “Mega” banks emerged, and emerge they did as they flexed their muscles, they extended their tentacles to not just commercial banking, but investment banking, pension services, insurance and life assurance, real estate, asset management and other financial services. The most interesting thing is they made most of their money (I will not call it profit, it is highly debatable) from sending their young, impressionable, enthusiastic staff, especially the female ones on “marketing” sojourns to increase their deposit and customer base. They engaged in massive recruitment of young, fresh graduates who were actively encouraged by many a manager to breach what little banking ethics they had in order to meet targets of bringing accounts or deposits of millions of dollars. One of my friends in her mid twenties was given an annual target of N480 million, roughly $3million and this was not an isolated case. As the money kept pouring in, so did the banks, the bankers and top executives became more opulent and brazen…branch offices kept springing up everywhere as they built many imposing structures and edifices existing side by side with abject poverty in communities. The bankers had fat salaries and bonuses, wore designer suits, drove flashy cars and just relished in lavish lifestyles very much like their counterparts in the US and Europe.
And just like their counterparts in the developed world, these Nigerian “mega” banks engaged in risky lending to risky customers, they gave loans to customers without collateral. But in true Nigerian fashion and very unlike the US where subprime loans were given to people, sometimes poor people who could not afford it, loans – which even had nothing to do with mortgages by the way – were given to only the rich and well-connected – very ironic right? Why would someone rich require a loan in the first place, and even more astonishingly, a loan without a collateral? So in essence, people’s deposits which they had worked hard for and entrusted to the banks as the safest place for their hard-earned sweat and which young, hapless staff at the lower rung of the bank hierarchy had toiled mind, body and soul (literally speaking) to get for the banks were given out to friends, allies, family members, politicians and even to themselves, for themselves and by themselves ( the bank executives). Reports have it that one of the bank CEOs gave loans worth millions of naira to her housemaid!!
With all this going on, toxic assets in the banks kept accumulating; the share prices of these banks which, like their counterparts in the developed world were in a false bubble of growth kept soaring as people kept falling over themselves to buy and invest in these shares based on false and inflated value. Thus, when the credit crunch hit the US and spread all over the world, our oil-based-oil-reliant stock market was hit particularly as the price of crude oil plummeted. The share prices of banks were affected as they also crashed. Even at that time, when economies elsewhere were trying to come to terms with the extent of the crisis, Nigerians were told that our economy and financial sector were immune to the crisis because the “Mega” banks were very solid.
Fast-forward to August 2008, with a new management in CBN, the shady dealings of the “Mega” banks were unearthed. It was discovered that people’s deposits were squandered as loans given without collateral. In addition, the bankers’ manipulation of share prices resulted in massive toxic assets in these banks, just like their counterparts in the US which had acquired toxic assets from risky repackaged loans. All these shenanigans had placed the banks – which were now public limited companies with share holders’ money – teetering on the brink of absolute collapse and threatening to drag the already weak Nigerian economy with it. But this is where the similarities end.
While in the US, in the UK, in other parts of Europe and even in Nigeria, the government had to bailout these institutions in order to maintain some economic stability and sanity – $700billion in the US, 400bn pounds in the UK and N500billion ($2.6billion) in Nigeria - the difference is that in Nigeria, even before that money was given to the banks, the government via the CBN governor ensured it sacked the CEOs and upper echelon of the banks that were found to be most guilty and irresponsible in breaching their customer’s trust, squandering their deposits and acquiring toxic assets. They were not only sacked, but criminal cases and proceedings were instituted against them – like Cecilia Ibru former CEO of Oceanic bank who has been convicted and ordered to forfeit $1.2billion - while others have their cases pending in court. This is a marked departure from what happened and is happening in the developed world where the bailouts essentially financed by tax payers was used by the financial institutions to give stupendous and obscene bonuses worth billions of dollars and pounds to their top executives at the expense of taxpayers. For example, Goldman Sachs in the US received $10billion from the US government in 2008 , and paid $1.2billion dollar as bonuses to its executives for the first quarter of 2009.
I guess the differences in approach to dealing with the crisis stem from the type of economic systems in operation. In much of the developed world, the free market economic system is in operation, based on neoliberal values where economic activity is meant for the private sector with little control or influence by the government. Government’s role is limited to regulation, provision of law and order and an enabling environment for private businesses or big businesses to thrive. While this model leads to increased profit stemming from competitiveness, the problem is that as the private sector which enjoys unbridled freedom acquires more profit and grows into mega banks and mega institutions, they acquire more wealth and they become increasingly sophisticated, they use complicated financial instruments like hedgefunds and derivatives, making them more elusive to regulation. With such increased wealth inevitably comes political power and clout which they can mobilize in influencing the process of their regulation. Simon Johnson a former chief economist with the IMF states that there was a “flow of individuals between Wallstreet (the financial nerve center) and Washington (the seat of government)…it has become something of a tradition for Goldman Sachs employees to go into public service after they leave the firm”. In Nigeria as well, the former CBN governor was reported to have been too familiar with Bank CEOs. Furthermore, as economic activity is left to the private sector, the activities of financial institutions became so intertwined with the economy that they just have to be rescued with government bailouts while at the same time government could not really call them to order. To think that this is a system which a succession of governments have tried and are still trying to force down our throats – recall the shoddy privatization of NITELand the so far futile attempts at deregulating the downstream sector of the oil sector and removal of subsidies from other segments of the public sector – makes me shiver.
Furthermore in Nigeria, the N700billion bailout package that was given did not come from taxpayers per se or from external loans. As an oil-producing country, the bailout came from resource rents (oil money) and therefore, there hasn’t been any need to implement austerity measures – such as reduced government spending, budget cuts and increased taxes. However in developed countries which heavily rely on taxation as a main source of revenue particularly with the economic downturn which has severely affected productivity and economic growth, austerity measures have been put in place in much of Europe and the US – ranging from tax increases such as the recent increase in VAT in the UK from 17.5% to 20% and benefits cuts in child care, education maintenance and the very controversial increase in University tuition fees in the UK.
It seems incredibly unfair for bankers and financiers who as a result of speculation and risky behavior or what the late political economist Susan Strange calls “casino capitalism”, to cause financial turmoil for their respective countries, get billions of dollars in bailouts and then reward themselves with stupendous bonuses for such irresponsible behavior while the masses suffer at their expense – benefits cuts, loss of jobs and a generally struggling economy . At present, the 27 EU countries have only recorded an average 1.4% economic growth in 2010 a negligible improvement from the dismal negative 4.2% meaning that many economies actually shrunk or were in the reverse according to EU statistics, while countries like Greece and Portugal are still recording negative digits. This is probably why citizens in these countries, depending on the severity of the crisis have been protesting, in some cases violently particularly in response to the tough austerity measures (what we in the developing world know better as Structural Adjustment Program – SAP) .
To think that this system which gives the private sector control and overbearing influence over vital sectors of the economy is what was pursued by certain policy makers and is still being pursued in some quarters in Nigeria through systematic privatization and deregulation, the consequences would have been absolutely horrendous for us. The reason why Nigeria was able to respond and rescue our ailing banks and even sack the top management is because we do not yet have in operation a full blown market economy, we still have vestiges of a state-led economy and I hope it remains so.
While there are a number of advantages of private sector led economy particularly in terms of service provision in the public sector and infrastructure like electricity, telecommunications and health services from innovativeness and efficiency and thereby improvement in service delivery, there are also evidently many pitfalls to that because the private sector easily succumbs to greed and resorts to all sorts of shenanigans inevitably resulting in financial crisis. There are so many things worthy of emulation from the West: we can improve our technological capability, our medical and healthcare system after the NHS for example, security of lives and property, ensuring a proper and efficient system of taxation which would help in making citizens demand for accountability and ensuring that things actually work, improving education at all levels and countless other things. But we do not have to copy everything, we have to find out what works for us before we consider wholesale importation of things particularly when it comes to complete liberalization and deregulation of the economy, I believe we are not ready for that.