Can Nigeria’s future be changed?
This type of arrangement guarantees that the future will be like the present without much changing.
After all, if you consume all your income today without investing any of it, what right do you have to think you’re going to have infrastructure in 20 years time?
But how bad is this problem of eating the future today? Is it something that can be solved if say oil goes back up to $100 per barrel? I don’t think so.
By not reforming today, what is happening is that the future is already in debt even before it arrives. Imagine breaking your back to pay off a debt. You are finally free of it, or so you think.
As soon as the final payment is made, you receive a letter saying actually, there is some more debt outstanding and you have to start all over again.
A few days ago, the Vice President gave a speech in Abuja at the Dialogue of Organs of Government on Reform of Justice where he made some interesting and alarming revelations, if unintentionally.
Speaking about how much the current government had done to support states, he revealed that a total of N1.9 trillion in loans had been extended to Nigeria’s states under this government.
He went on further to say, of that amount, N873 billion had been given as loans secured against the Excess Crude Account (ECA) as at September 2017. He even said no government had ever given this level of support to states in Nigeria’s history.
But the key thing to note here is that if you have been counting the ECA as part of Nigeria’s future, you should stop now. The future has been consumed today – Nigeria cannot arrive at any point in the future and expect to be able to call on the ECA. Why? Well, in January of this year, the finance minister told the nation that the ECA had a balance of $2.3 billion in it.
Don’t forget that the same governors gathered in December 2017 and ‘approved’ $1 billion from the ECA to wage war against the technically defeated Boko Haram.
Even if we use the generous interbank rate of N360 to $1 (the official rate used for government is actually N305 to $1), the balance in the ECA comes to N828 billion – less than the amount secured against it as loans.
And that is even assuming all the money in it belongs to the states and that the $1 billion to fight the Haramists of Boko has not already been withdrawn.
Things are quite bad with Nigerian states. Most of them are just money pits who cannot even dream of balancing their books. But the damage they are doing is not just to today – they are currently eating the future as well and putting it in debt.
This is the story of how nations become stuck in patterns and bad habits and the same problems get passed from generation to generation without anyone finding a solution to them.
Even if you stand still in one spot today, the future will arrive there to meet you. So what kind of future is lying in wait for Nigeria?
This past week we’ve seen a few candidates declare that they’ll like a shot at being president of Nigeria. Having options can never be a bad thing, so the more the merrier.
But one way we are going to have to question any candidate is to ask them how they are going to repair the future in a way that alters Nigeria’s destiny so it does not remain a non-developing country forever. No matter what any candidate for office promises to do, a lot of the reality they are going to face in office is simply hard repair work.
It is important to keep an open mind to any candidate for office. But imagine queuing in the sun to vote for candidates in the hot sun and then they get into office, take a look at the books, and then realise they have no workable ideas to fix the mess they have inherited.
So they just continue what they inherited and keep paying salaries and loading up more debt for the next person after them.
The best case scenario with something like the ECA is that the loans secured against it will be written off i.e the government would simply have printed money and ‘dashed’ the states. In that sense the cost of the borrowing would have been transferred to ordinary Nigerians in the form of inflation.
But at least it reduces the damage the next person is going to inherit. The future is already in debt. Nothing is being saved or invested today for tomorrow. Problems are being transferred to the future while the future is going to have its own fresh problems as well.
Ask anyone who wants to lead Nigeria how exactly they plan to carry out this mechanic work. It is the most important question facing Nigeria today.
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