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Wednesday, 19 September 2012

.....on the fuel subsidy removal

As the Nigerian people were in jubilation and merry-making over the transition to a new year, 2012, and as some were giving thumbs up to the president on the declaration of state of emergency in some ravaged areas in Nigeria (which most people, including me, saw as a big surprise unlike “GEJ”and as a new year gift to Nigerians), little did they know that the government was just “kissing their cheeks only to finger their asses”. It was like a bombshell to a population of more than 150 million people.

The negative effects of recent fuel subsidy removal (if there was anything like that in the true sense of subsidy removal) are widely known to a common man in my village. So there is no point belabouring over that. But it will suffice to say that the current action of the Nigerian government is nothing but a gross affront to the MDG’s, especially the first on the list- reducing poverty by half by the year 2015; a spit on the face of the recently celebrated (by GEJ’s administration) fall in the HDI in Nigeria; and a whip-in-the-asses of the electorates who massively voted for GEJ under the deceit by the campaign messages- “transformation agenda,” and “breath of fresh air.” An Igbo adage in the part of the world I come from, loosely translated into English, says that ‘when the heavy wind blows we will see the hidden buttocks of the hen” The wind has blown and we can now see that all the transformation agenda, breath of fresh air, etc are all gimmicks. I wonder if anybody in Nigeria is breathing fresh air or contaminated air. Your guess is as good as mine!
There is no doubt that the logic of ODA/IMF in pushing forth the deregulation “conditionality,” which fuel subsidy removal is an integral part of the story (of course you cannot be talking of about down-stream deregulation and still be spending much subsidizing petroleum products) is now in motion as being paraded by the chair of the “Ivy-league ministers” or better still the “transformational economic team”, though she keeps exonerating herself from the well-known fact. But we all know her pedigree!

There is nothing actually wrong in fuel subsidy removal as evidence from the economic literature has shown that fuel subsidies are a costly approach and thus exhibit an unequal balance on the average income of the people. (See D. Coady et al 2010 and J. Granado et al 2010). But everything is wrong with the timing and the sequence Nigerian government approached it. Subsidy removal policy is a gradual process, which involves consultations with the people directly or indirectly (end point of every policy should be peoples welfare) and putting mechanisms (stabilization policies) in place to absorb the shocks there-from. People ought to have been engaged via town meetings, after all the president literally went around the whole country soliciting for people’s votes prior to April 2011 elections, or better still allow the National Assembly to deliberate extensively on the issues using referendum or plebiscite mechanisms. This goes a long way in explaining the nature of policies introduced in Nigeria over the years. Anecdotal evidence has shown that policies in Nigeria never go beyond official launch of the policy document. You can easily verify!

Moreover, there is a stack difference between native intelligence and academic intelligence as well as there is difference between intelligence and wisdom. The current Nigerian leadership has shown that it lacks the native intelligence and wisdom needed in every leadership as it has failed to understand that peoples’ welfare should be at the centre stage of every policy. Welfare of every Nigerian citizen is enshrined in the CFRN. The current leadership has failed to guarantee that. Despite the array of intellects present in the current leadership, the material conditions of the Nigerian people keeps retrogressing rather than otherwise as one would expect. This simply underpins the truism that parading avalanche of PhD holders (most of whom were fortunate to be trained with the government’s funds) from Ivy League schools does not guarantee good governance. Those eggheads end up experimenting on the Nigerian economy with their adulterated, though brain-wave, case studies from Harvard, IMF/World and the likes, which never works and will never work until the right structures are put in place. The common Nigerian man end up being their apparatus!

The time is now ripe for wind of change to blow. Now is the time when the heat of the battle is on. The government has eaten more than it can munch. Politicians have taken the Nigerian electorates for granted enough. They will come to our neighbourhood with flowery promises, give us few crumbs and nothing will happen afterwards. Nothing will ever change until we become politically empowered- holding the people we voted into offices accountable for their actions, responding aggressively to untoward policies of the government, and asking the right questions such as: why have successive governments left the refineries in a state of moribund while spending hugely on subsidy? What has happened to excess crude accounts over the years? What are the chances that the savings from fuel subsidy withdrawal will go unhampered into infrastructural development like building functional to capacity refineries? Will the fuel subsidy removal imply emasculation of monopolistic powers of the NNPC as sole importer of refined petroleum product or is this another round of gimmicks towards sustaining the NNPC’s rent seeking tendencies? Why should I, a citizen of the largest oil producer in Africa, be made to suffer the burden of governments incompetence and inept to control racketeering or profiteering by bunch of cabal the governments has shamelessly often referred to?

I rap up this extemporaneous write up with lots of doubts that the current fuel subsidy removal will put an end to the issue of cabal, which has precipitated the sudden subsidy removal. The truth is starring us in the face. They know who the members are; they dine and wine with them. The cabal will only retreat to re-engineer tactics! I may not be the one to effect the change but I can bring the spark that can make the change!

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