Finally, the Nigerian government has practically devalued the naira.
Given the nation’s economic and fiscal realities, action in that direction had been expected by many in the past year. But President Muhammadu Buhari would not hear of it.
One recent report said he had agreed to devalue the naira in exchange for International Monetary Fund (IMF) funds to implement the 2016 budget in the face of plummeting revenues, and that some of his aides projected the exchange rate to the dollar to drop to as low as 290.
Mercifully, last week, as Buhari lay on his non-troubled left ear in a bed in good old London, England, the Central Bank of Nigeria (CBN) announced the decision. It came exactly one month after the same bank had vigorously denied there was such a plan.
That denial had followed a statement days earlier by Vice President Yemi Osinbajo that in order to encourage an inflow of foreign investment, the CBN needed to change its foreign currency policies.
That position was in alliance with that of the IMF, which maintained that while Nigeria had requested no help of it, the country would certainly benefit from a more flexible exchange rate.
Speaking to reporters in Nigeria during his visit in mid-May, British Foreign Minister Philip Hammond said that the implication of Nigeria’s decision to allow fuel importers to buy US dollars on the black market was that she had practically devalued the naira.
"The exchange rate applicable to oil imports effectively recognises that there is an imbalance in the official rate," he said. "Maybe they'll take the logic of how this goes and move further.”
It took another month for CBN Governor Godwin Emefiele to announce the measure, saying last Wednesday it would “restore the automatic adjustment properties of the exchange rate.”
It is of tremendous interest that the CBN action arrived two days after an article by President Buhari in the Wall Street Journal in which he said in passing, “The central bank has moved to introduce greater flexibility in our exchange-rate policy.”
In the article, “The Three Changes Nigeria Needs,” he described Nigeria as being “at a crossroads” and that “solutions must be in proportion to the challenges.”
He characterized the first of those changes as being to “restore trust” in government by combating endemic corruption and mismanagement, and instituting accountable government and a public sector that can do more with less.
The others: to rebalance the economy through reducing the over-reliance of Nigerians on imports; and to “regenerate growth,” through attracting investment in domestic industries and infrastructure.
He concluded: “What we do in the next three years to build an economic bridge to Nigeria’s future will be just as important for bringing lasting peace and prosperity.
I have never understood why Nigerian leaders resort to publishing opinion pieces in foreign journals when they should be speaking to their own people. I have never read a Barack Obama opinion in BusinessDay.
Nonetheless, if Mr. Buhari’s conclusion is a concession that the first year of his tenure may have been squandered, which it largely was, it is to Nigerians—not foreigners no matter whom they might be perceived to be—to whom he owes a rallying cry.
Not some American in Seattle, Washington, who has no idea where on the map Nigeria is.
But also curiously absent in the president’s article was a preface introducing CBN’s Emefiele, because, in the end, the article seems to have been designed to introduce the new exchange rate policy.
The reason is that in Nigeria, we often neglect history and the critical intersection of events. But the foreign audience targeted in Buhari’s article, you can be sure, knows Emefiele not as some fiscal and policy whiz, but as a corrupt and incompetent professional who has yet to discharge any of the serious allegations against him, including money laundering. Our prospective foreign investors will wonder why they should take Nigeria seriously if he exemplifies whom we are.
It is only three months ago Emefiele was exposed in the secret recruitment of children and relatives of influential Nigerians who included, sadly, President Buhari himself, towards currying favour with the political establishment. Yet another report the same week revealed that in the past two years, the CBN illegally and secretly hired over 900 persons.
Also well-publicised is Mr. Emefiele’s role in the Sambo Dasuki $2.1 billion arms scandal; his circulation of bank funds for the PDP’s prosecution of the 2015 election; and in the off-shore promotion of the business interests of businessman Aliko Dangote.
These are concerns as to why President Buhari’s article should have been published at home, in a Nigerian newspaper, and for the Nigerian people. Nigeria’s troubles—and their solutions—are inside Nigeria.
Only Nigerians, not foreigners, can truly fight Nigerian corruption, and it is only Nigerians who can restore trust in governance and institutions in Nigeria. If the current government wants the trust of Nigerians, it should respect Nigerians, beginning with the art of conversing with them.
In other words, combating corruption and managing the economy are not two separate subjects. To restore trust and rebalance the economy is almost completely in our hands, beginning with a thorough-going assault on corruption that is not challenged by such obvious contradictions as having discredited officials in key positions.
People have to be fired, and prosecuted. People such as Emefiele, his illegal hires and the civil servants who allegedly padded the budget.
As a result, we have lost another year to excuses and explanations. A true offensive should crank up anti-corruption activity so that the corrupt, not their victims, feel the fire. Abuja, for instance, is loaded with massive estates and other property that are a veritable mockery of the anti-corruption rhetoric.
It is remarkable, for instance, that while President Buhari was writing for the American media last week, former Petroleum Resources Minister Diezani Alison-Madueke was writing for the Nigerian media. She accused the Buhari government of a witch-hunt, because despite all of the reports and innuendos, she has yet to be charged in the media but not in court.
What all of this means is that President Buhari’s government, by its own work, or lack of it, has entered a soccer game’s injury time without playing the second half. It now has no margin for error and no place to hide.
If it is not to lose the support of the population and forfeit that fabled trust it speaks about, it must define accountability in terms of itself, not just in principle, and prove it.
If the Buhari government is not to become part of the tragedy, it must end the reign of rhetoric. It must support the rule of law must obey court orders, including disclosing the nation’s loot recovery and spending records since 1999, and publish unedited the names on its loot recovery list.
It must resist the temptation to talk down on Nigerians or take them for granted. We have seen double-talk and double standards and double agendas before. Ask the NPN. Or the PDP.