On Friday, May 20th, 2016, Dr. Yemi Kale, the Statistician General of the Federation and head of the Nigerian Bureau of Statistics (NBS), revealed that Nigeria’s economy had not grown in the first quarter of the year but had rather shrunk to its lowest level in 25 years! Since the announcement was made, there has been various reactions with pundits pointing at this or the other as being the cause of this setback. But I am convinced beyond any reasonable doubt that this negative trend owes more to President Muhammadu Buhari’s utterances on our economy and polity than to any other single causative factor.
In the last 11 months, the president had traversed the globe and has spoken about Nigeria’s economy as if he was the chief undertaker of our polity rather than the chief marketer that he is meant to be. Of what benefit is it to the president’s agenda or to Nigeria’s economic well being for him to go to foreign nations and instead of highlighting the positive things that are happening in Nigeria, he begins to regale his hosts with the most unsavoury stories about Nigeria. And some of the stories the president tells are just that-tales. They are not factual. At best they are arguable.
You go to India for a summit where other world leaders are competing with you for the attention of venture capitalists and foreign investors and while your counterparts are talking about how great their countries are, you tell the audience how everybody in your country is corrupt except you and oh, can they come and invest in your country? Only a foolish investor would go and invest in a country whose president thinks his citizens are ‘criminals’ (as the president said to the Telegraph of UK in February) and whose officials are ‘fantastically corrupt’ (as the president said in agreement with British PM David Cameron when questioned by Sky News).
The president speaks on the Nigerian economy and polity without any filters and his comments are causing his chickens to roost with devastating consequences for all of us. Never in the history of Nigeria has there been such a divestment of investment as we have seen in the past year. Truworths has pulled out of Nigeria, Virgin Atlantic has closed up shop, Iberia is pulling out, RenCap is pulling funds from Nigeria, both Alquity Investment Management Ltd. and Duet Asset Management Ltd. are divesting their Nigeria holding.
Zenith Bank laid off 1,200 staff, FCMB let go 700 employees, Ecobank sacked 50 per cent of its top management staff. The President of the Abuja Chamber of Commerce and Industry, Mr. Tony Ejinkeonye, revealed that in just two months, 50,000 staff were laid off in Abuja alone. The results are telling. A little over a year ago, Nigeria was projected by CNNMoney to be the third fastest growing economy in the world behind China and Qatar, yet just two weeks ago, the International Monetary Fund (IMF) released its World Economic Outlook and Nigeria is not even among the top 15 fastest growing economies in Africa let alone the world!
And when you try to raise the alarm, the refrain from the government and its horde of unofficial spokesmen is that the downturn is caused by the fall in crude prices. Yet this logic is flawed. The government’s own economic monitoring agency, the NBS itself reported that the exponential growth Nigeria enjoyed especially from 2012 to its 2014 climax (when our economy overtook South Africa to be Africa’s largest economy) was spurred not by the oil sector, but “this growth was largely driven by improved activities in the telecommunications, building and construction, hotel and restaurant and business services” to quote
Yes, oil accounts for something like 90-95 per cent of our foreign exchange revenues but it only accounts for a mere 15 per cent of our GDP. The service sector and the commercial and real sector are the engine or use
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