Just 100 days since President Bola Tinubu took up the reins, he may have pulled millions of poor Nigerians below where his predecessor, Muhammadu Buhari, left them on May 29 on the poverty line.
Tinubu said the economic reforms of the last three months, including fuel subsidy removal and foreign exchange (FX) liberalisation, would rescue the country from the control of the “tiny elite” and improve the lives of over 200 million citizens.
But the reality is not near the promise, perhaps too easy to tell how much of the promise he will eventually bring to reality. For instance, as pupils resumed school, yesterday, parents whose incomes have stagnated for years with minimum wage review negotiation not making much progress, were compelled to pay at least 70 per cent higher than they paid earlier in the year for school buses.
School management said the increase is to enable them to cover an over 200 per cent increase in the pump prices of premium motor spirit (PMS), which is used to power most school buses. Tuition fees have also been raised, some by as high as 50 per cent.
No sooner had Buhari taken up the reins than he declared “subsidy is gone” paving the way for fuel marketers to increase the price of the essential commodity from N185 per litre to over N500 for the highest band.
A few weeks later, a further adjustment was made to the prices, with the price now swinging between N568 and N700 depending on how far a state is from Lagos, which hosts the landing ports of the imported finished product. Nigeria, Africa’s top crude producer, has had its refineries grounded for years, making it rely on importation.
The Lagos ports were initially connected to depots across the country for ease of distribution. But the pipelines have been in disuse, forcing marketers to haul fuel via roads – part of the inefficiencies formerly subsidised but now partly passed to the consumers following the subsidy removal.
Elimination of the safety net, which took about N4.5 trillion off the public revenue last year expanding the fiscal deficit by about 100 per cent, could render 7.1 million Nigerians poorer, the World Bank said in its 2023 Nigeria Development Update (NDU). The global bank added that the initially planned N5000 cash palliatives planned for 10.1 million could only reduce the number of poor people the subsidy removal would cause but erase the consequence.
The planned monthly palliative, the report argued, could only lift 1.7 million out of the 7.1 million individuals that could be rendered poorer by the removal of the social scheme, if extended to only 10 million people. Tinubu contemplated raising monthly stipends to 8,000 before he backed down on account of widespread condemnation and mockery of the plan.
Mid-last year when fuel was still pegged at N185 per litre, the Numbeo Quality of Life Index ranked Nigeria as top of the 10 worst countries to live in. Some of the metrics tracked by the survey were quality of life and poverty-related issues. Last year also, the National Bureau of Statistics (NBS) said 133 million or 63 per cent of Nigerians are multidimensionally poor. With fuel prices, which determine other costs as demonstrated by the recent spike in the inflation reading, now over three times what it was last year, economists said the living conditions would be worse.
Less than a month into the administration, the Central Bank of Nigeria (CBN), whose leadership was touched by the President in fulfillment of his promised monetary policy “housecleaning” with the suspension of Godwin Emefiele, adopted a pro-market approach to foreign exchange management.
Within days, naira, which was trading at an average of N463/$ to at the official market fell to over N700 to a dollar while the black-market rate is currently over 900/$. The sharp rise in the exchange rate, alongside high energy cost, has caused a ripple effect in the goods market. Year-to-date, the currency now ranks the worst performing in Africa after suffering a hair shave of about 40 per cent against dollar.
In response to the changes made by Tinubu, in June 2023, the headline inflation rose to 22.79 per cent relative to May 2023 headline inflation rate which was 22.41 per cent. Despite a declaration of state of emergency on prices of food by the President, In July, the headline inflation rate rose further to 24.08 per cent.
But unlike Buhari, most economists have aligned with Tinubu on the courage to activate the Petroleum Industry Act (PIA) in the aspect of downstream deregulation and the courage to float the naira. However, they fear that things may go south without critical planning.
The dissolution of the boards of government agencies announced about 20 days into his government was also to correct the anomalies under Buhari was also commended by stakeholders.
To beat the deadline allowed by the law, Tinubu sent 47 names to the National Assembly as ministerial nominees making history as president with the largest ministerial appointees. About two weeks ago, 45 of the ministers took office.
The quality of the ministers, especially the familiar faces has been called into question. Some experts wondered how the size demonstrates a commitment to reducing the cost of governance reducing the fiscal deficit that led to subsidy removal. Bloated cabinet with overlapping roles at a time when the government needed to cut down on the cost of governance showed that most people who have helped the President to get to office are only getting their ‘thank-you’ packages.
Economist and energy expert, Prof Wunmi Iledare, said the removal of subsidy and floating of the naira were laudable steps in the first 100 days of Tinubu’s administration
Despite the painstaking shock to the downstream market in the short run, the professor emeritus said the long-run positive effect is worth the pain. He said the floating of the naira would stabilise the market volatility but the administration must stay the course.
“I like the idea of paying just a form of commission to licensed forex dealers rather than trading currency the way it is done at the moment. Of course, without proper coordination and enforcement, it may make the informal forex market re-emerge,” he said.
Iledare, who is the Executive Director at the Emmanuel Egbogah Foundation said it would be foolhardy to expect Tinubu to take Nigeria out of the high composite misery index, a reflection of high unemployment, high inflation and high fund rate, within 100 days.
Former President of the Chartered Institute of Bankers of Nigeria (CIBN) and Professor of Economics at Babcock University, Segun Ajibola, said the first 100 days in office of Tinubu have been dogged by the display of courage, commitment, determination and political will to pilot the affairs of the nation in the right direction.
According to him, Tinubu has taken many bold steps and touched those grounds where for decades ‘angels feared to tread’. Ajibola noted that the removal of petroleum subsidy to checkmate the ‘rent seekers’ has been long overdue.
Admitting to the initial pains, Ajibola sees the stoppage of the leakages in Nigeria’s commonwealth to a few pockets, the determination to get the local petroleum refineries back to the stream and the blockage of smuggling of petroleum products from Nigeria through the porous borders to the neighbouring countries as soothing balm on the economy.
“Government stance on improving the electricity supply is deserving of mention. The desire to pursue the new law empowering States to go into the power business, the vow to make the generation companies, distribution companies and Nigerian Electricity Regulatory Commission (NERC) more efficient and responsible would go a long way to improve the performance of the energy sector in no distant future. In particular, the States are now challenged to do everything possible to improve the electricity generation, transmission and distribution in their respective jurisdiction,” he stated.
Prof. Uche Uwaleke said what is important at this point is to examine the policies already put in place to see whether they hold some promise to revamp the economy.
Uwaleke said: “I think the major reforms to do with fuel subsidy removal and exchange rate unification are in order, however, the snag I see is the sudden manner of their implementation which is causing untold hardship on the citizens.”
On his part, Prof. Sheriffdeen Tella said so far, the administration has shown some boldness in taking some actions, particularly concerning the stoppage of fuel subsidy and harmonisation of the exchange rate.
The erudite economist at the Olabisi Onabanjo University explained that these two activities are also linked with the continuous importation of fuel which will always put pressure on the exchange rate because of the volume of the imports.
The Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, said the economy slowed in the second quarter owing to shocks from current economic reforms which impacted energy prices and the naira exchange rate.
He noted that the adverse impacts of the reforms were disproportionately higher than expected. He described the negative impacts as the pains of removing distortions in the economy.
The President did promise to hit the ground running. To match his words with action, he demonstrated that he was not in for fun when a few hours after taking his oath of office, he made the first appointment of State Chief of Protocol.
He had on June 2, appointed another set of officials that included the Chief of Staff, National Security Adviser and Secretary to the State Government (SSG) and held his first meeting with the immediate past security chiefs.
To check corruption, on June 9, he approved the suspension of Emefiele and the Chairman of the Economic and Financial Crimes Commission (EFCC), Abdulrasheed Bawa. The president also approved the duo for prosecution.
To address the imbalance in the security architecture, Tinubu had on June 19, announced a new set of service chiefs. The development ended the agitation that had raged in the last eight years over the lopsided appointment of heads of security as it reflected personnel from the six geopolitical zones.
Within the time frame, Tinubu submitted the first list of ministers to the senate for screening. A few days later, he submitted an additional list of cabinet members without their portfolios against the expectations of many Nigerians. But after the screening, he assigned portfolios to them on August 16 while 45 of the nominees were sworn into office on August 21.
The large number of members of the Federal Executive Council (FEC) currently leaves the president with the largest set of ministers since the return of the current democratic experience in 1999 with about 47 while his successors such as Muhammadu Buhari had 36, Goodluck Jonathan (33), Musa Yar’Adua (39) and Olusegun Obasanjo (42).
Similarly, what seemed a blistering start for the President has continued to be challenged by the threat of a strike by the organised Labour over the removal of fuel subsidy, as well as the coup in Niger Republic that removed from office the elected president, Mohamed Bazoum, by the military. Tinubu is the Chairman of the Economic Community of West African States (ECOWAS).
But how has President Tinubu fared in his first 100 days with all his promises? Do the imprints made so far point towards the direction of a “renewed hope” which he had asked Nigerians to expect as he was being sworn into office on May 29?
A Chieftain of the All Progressives Grand Alliance (APGA), Chief Chekwas Okorie, told The Guardian that many positives can be credited to President Tinubu in his first 100 days in office relative to his predecessor “who was even nicknamed Baba-go-slow as a result of his lethargic tendencies and indecisiveness on matters of national urgency.”
“It appears that the president listened to genuine advice by well-meaning Nigerians that public office holders must be subjected to periodic appraisals based on realiseable targets. He should not hesitate to offload those who are found wanting.”
Okorie agreed that there is heightened suffering of the citizens since the administration came on board, especially with the removal of fuel subsidy, stressing however that “most of his difficult decisions are unavoidable if we are to come out of the woods and embark on a sustainable recovery process.
“It is reassuring that the President has committed to not borrowing any more to fund national projects. The welcome policy statement is a result of the measures taken to block leakages and raise national revenues. He has publicly rejected the practice of servicing our huge loan portfolio with 90 percent of our revenue receipts. There are some indications of the prospects for a brighter future. I disagree with the picture of a gloomy future that some members of the opposition are painting. It is also important to acknowledge that the process of national healing has started in earnest. There is a reasonable sense of equal citizenship by a cross-section of Nigerians. The healing of the wide division and alienation some Nigerians have suffered is a precursor to national unity, which Nigeria urgently needs.
Emeritus President, Aka Ikenga, Chief Goddy Uwazurike, did not, however, see President Tinubu toeing a different line in solving the country’s problems with the way he has gone in the last 100 days.
Pointing at insecurity ravaging the nation, he said: “Nobody expected Tinubu to solve the dangerous insecurity suffocating the nation in 100 days but let’s hear the president directly about what he is doing on it. Pretending that everything is going well is a horrible political disaster. Expecting farmers and travelers to go about their business is myopic. The fact today is that the terrorist groups are still in charge of the crucial farming areas.
“The 100-day report is a mismatch of expectations and disappointment. Today, the trending topic of discussion amongst the rank and file of Nigerians is the harrowing cost of living. Removal of the subsidy of any product is not and cannot be by executive fiat. This government has shown a shallow understanding of the needs of the common man. Food, medical needs and infrastructure costs are sky-high. The common man is pleading for a chance to breathe. Survival is the next topic of discussion amongst the rank and file of Nigerians. To go out to work, he needs transport. He needs more money for transportation. He stays at home and so productive ability is stunted. National productivity goes down because the working class can no longer work!
“The japa syndrome is no longer whispered. It is a destination movement for the professional class and the desperate young ones. Some go on foot through the desert, some by ship and yet others stow away in any craft.
“What about education? The discordant tunes of the government on the fees paid by students in the various schools means the average person cannot afford to train his kids. The consequences are beyond my imagination. In a simple language, this government is laying a ticking time bomb”, he added On the President’s choice of ministers, Uwazurike, the lawyer stated that it was a composition of the “good, the bad and the ugly.”
“Of what use to the nation is a governor rejected by his state? How can you appoint a person under investigation by EFCC but lock up the investigation chief? The South East is still wondering why the discrimination it suffered under Buhari is unabated. Rather, it is galloping forward. In terms of ministers, we know how we are. In other appointments, we know how they are from 2015 to date.
“This issue of lack of obedience to a court order and absolute contempt for the rule of law and the judiciary is mind-burgling. What happened to the averments of APC on the supremacy of the constitution? Detention without trial is the rule today, not the exception.
“The legislature is today an extension of the executive. People who are under investigation are the reigning class. In other words, can I report anyone in government for corruption? I think it will be foolhardy to do so.”
Executive Director, the Civil Liberties Organisation (CLO), Ibuchukwu Ezike, stated that the Tinubu government’s policies in the first 100 days have kicked off a myriad of other heinous socio-economic crises that have brought huge hardship, sufferings and problems upon our citizens.
On the daunting task posed on the president as chairman of ECOWAS following the military coup in Niger Republic, a Policy Development Expert, Dr Johnson Ude, stated that the president should improve on dialogues for its settlement, insisting that he would be opening his administration to “unimaginable challenges” should he support military option. – Guardian.
