Every problem that confronts the in-coming Buhari is huge. The poor state of the economy is a huge problem. Corruption is a huge problem. Indiscipline is a huge problem. Energy is a huge problem. Poor infrastructure is a huge problem. A weak institutional support is a huge problem. Poverty is a huge problem.
These cocktail of problems are looking for a solution. Each of them is big enough and complex enough to fully task the in-coming administration. Of all these huge problems, the economy occupies a unique place. It being the pillar of human development, the economy has both the capacity to be a solution to other problems or an added problem to the problems. A vibrant and buoyant economy can release enough fund into the system to tackle energy, poverty and the poor infrastructure. On the other hand, a weak and weakened economy can drag down whatever progress might have been made in these and other areas.
We need not waste our sympathy on Buhari. Fate has thrust on his shoulders the huge responsibility of responding sensibly, honestly and with determination to these problems, none of which is new but all of which have conspired to make our country a land of cruel ironies in human progress and development. In a positive sense, how he responds to these and other problems will tell us the quality and the focus of his leadership.
The economy might once again prove to be the most complex problem that Buhari and his new administration might face. I had hoped that the outgoing administration would provide the incoming administration with full facts about the true state of the economy. That has not happened and it is not likely to happen before the general assumes office in less than a week as of this writing. For reasons that are difficult to fathom, the Jonathan administration and its economic managers are playing hide and seek with the facts on the real state of our national economy. In 1984, it took Buhari more than six months to see the true picture of how truly poorly the economy was managed. That took something away from the urgency he needed to respond to the problems.
The minister of finance and the co-ordinating minister of the economy, Dr. Ngozi Okonjo-Iweala, tells us the nation that there is nothing to worry about the state of health of the economy. She claims it is in robust health. She wants us to believe that the Jonathan administration would hand over to its successor a sound and well-managed economy. We now know that she is playing politics. Her claims are at variance with the facts seeping through the cracks. The feel good policy of the Jonathan administration had the merit of keeping our hopes afloat on the sea of insincerity.
One of Jonathan’s smartest moves was to hand over the management of the economy to Okonjo-Iweala. I am prepared to bet that the president himself does not know the true state of the economy. He relies on what the World Bank says. I suspect this is the real reason his transition team headed by his vice-president, Namadi Sambo, feels reluctant to co-operate with Buhari’s transition programme. Now, we know a little more about the poor state of the economy. The Economist magazine put it rather starkly early in the year: Poverty has increased in the five years of the Jonathan administration.
You do not need to be an economist to know that the national economy has been hemorrhaging badly for quite some time now under Jonathan’s watch. One major area of leakage has been the theft of crude oil since 2011. The nation loses an average of N7 billion daily to the oil thieves. The oil theft has been compounded, of course by the volatility in the crude oil market. Money accruing from oil into the national coffers has consequently and systematically dwindled such that state governments take in less and less as their statutory shares from the federation account. The inability of the state governments to pay their civil servants and pensioners is the logical consequence. Of course, we cannot discount corruption and poor financial husbandry as contributory factors to what is happening to finances of the state.
I am intrigued that despite the federal government’s reluctance or refusal or both to fully brief the in-coming president, help has come from other informed sources such as the organized private sector and the Lagos Business School. Some grim facts and a bleak picture have emerged from these sources. The vice-president-elect, Professor Yomi Osinbajo, is convinced that the Buhari administration would “inherit the worst economy ever in the history of the nation.”
These are some of the bleak facts and figures:
1).  The nation’s local and international debts amount to a whopping $60 billion;
2). More than two-thirds of the 36 states owe arrears of salaries and pensions, some for 13 months;
3).  About 110 million people in the country live in extreme poverty;
4). The country borrows to fund its recurrent expenditure.
Professor Charles Soludo, former governor of the Central Bank of Nigeria, drew national attention to the hemorrhage of the national economy early this year. In an article he published in the heat of the electioneering campaigns, he argued that the economy was bleeding from “oil theft, unbudgeted oil subsidy payments, customs duty waivers, leakages through the self-financing government parastatals, unremitted sums by NNPC, etc.”
The cumulative effect of these, he pointed out “…is that probably more than N30 trillion has been stolen or lost or unaccounted for or simply mismanaged under your (Okono-Iweala’s) watchful eyes in the past four years.”
Okonjo-Iweala saw his argument as a personal attack. She promptly recruited hire hacks to attack Soludo and tried to turn his record as governor of the Central Bank of Nigeria on its head. But this was neither about the minister nor the former CBN governor. It was about the poor management of the economy. When Jonathan handed the management of the economy to her and went to sleep, he relied on her reputation as a Harvard-trained economic whizz-kid with a sterling employment record in the World Bank. But the management of the Nigerian economy is a veritable killer of reputations.
In her book, Reforming the Unreformable, written after her first stint as minister of finance in the Obasanjo administration, Okonjo-Iweala observed that in the early 2000s, “The nation was riddled with corruption, bloated with debt, battered by economic volatility. The macro-economy was seriously imbalanced. A series of national institutions – the civil service, pensions, customs – were broken. Health care, education, and other basic services were poorly delivered. Infrastructure was in disarray or disrepair. Poverty was rampant and inequality was deep.”
What has changed in that bleak picture? Nothing. The picture is even bleaker now.
Buhari: “We have seen the debt profile and the performance of the economy. The question is, what can we do about it, especially the urgent ones like social security, lack of fuel in the country and fraud?
The billion Naira question. It is the one question the president and his economic team must address urgently and honestly. Buhari did not expect to be saddled with managing poverty. Now, he has to. The challenge of giving hope to 110 extremely poor people invites nightmare even in the daytime. Poverty and poor people are serious problems for leader in an honest pursuit of positive and lasting changes in his country. You see, if Buhari does not take focused steps to get the kingdom of the economy right, the kingdom of good governance, peace and social development would only beckon to us from the distant shores. Perish the thought. [myad]