29 Jul

The week ahead – Security, or a lack of it, has an economic effect

Heightened criminal attacks on Lagos state communities appear not to be slowing as militants descended on Igando, a community in the Lagos West Senatorial district, maiming and stealing properties worth millions of naira. Equally, the Ikorodu area of Lagos East Senatorial district has been under siege for months from suspected militants with killings and kidnapping rife in the area, and no end in sight. This has led to displacement of families and residents, and economic activities grinding to a halt. Badagry, also in Lagos West, witnessed the kidnap of the Oba. On Thursday July 28, a combined team of police and army personnel engaged Ijaw militants in a firefight.

The Nigerian Army has announced it would commence a training exercise code named “Exercise Crocodile Smile”, to be anchored by its Special Forces, in readiness to combat the militants in the restive oil rich region. It may be recalled that the activities of Niger Delta Avengers, a militant group in the region has crippled most of oil production and threatened more crude oil cuts. All efforts by the current government, in an attempt to encourage the warring group to dialogue has been abortive.

At least ten people were killed, and many others injured when once again, Logo Local Government Area in Benue State was attacked by assailants suspected to be Fulani herdsmen.Suspected killer herdsmen struck in Logo Local Government area of Benue sate killing at least ten persons and leaving several injured. The attacks on Logo have become a recurring feature despite a peace meeting held last week between stakeholders of the affected Tiv speaking communities and herders.

A command post of the Multinational Joint Task Force located at Damboré, a border town between Cameroon and Nigeria, occupied by Cameroonian soldiers, was attacked, Thursday night by members of Boko Haram. This follows last Sunday’s attack on an MNJTF command post in Kamouna, Cameroon. The Boko Haram members wounded a soldier and made away with some arms and ammunition.

The Speaker of the House of Representatives, Yakubu Dogara, has given a seven-day ultimatum to the former Chairman of the Committee on Appropriations, Jibrin Abdulmumin, to retract all allegations of corruption against him and tender an unreserved apology or face legal action. Abdulmumin, however, described Dogara’s threat of legal action as a ploy to stop the House from investigating his allegations. He said he would not retract the allegations, adding that his lawyers had officially approached the Economic and Financial Crimes Commission (EFCC) and the Independent Corrupt Practices and other related offences Commission (ICPC) to work out a date for him to submit his petition against the speaker, Deputy Speaker Yusuf Lasun, Chief Whip Alhassan Doguwa and Minority Leader Leo Ogor. This is as a new group among the lawmakers named Transparency Group demanded that the anti-graft agencies open investigations into the allegations leveled against the speaker and other principal officers.

The Minister of Finance, Kemi Adeosun, has said Nigeria is to finalize a policy support document needed to complete its application for funds to help bridge the $11 billion budget deficit. She said the administration’s strategy also envisions heavy spending on infrastructure projects to jump-start growth. The minister said the delayed passage of the 2016 budget had stalled the start of those projects to the fourth quarter and stated that the central bank’s decision last month to remove a 16-month-old peg on the value of the naira is the signal that international lenders, including the World Bank, have been waiting for.

Suggestions

  • In retaining the current Minister of Interior, we must question the judgment of the President. It is the minister’s task is to ensure law and order using the various law enforcement agencies. It is sad that the level of insecurity is growing, and we can discern no plans by the federal government to end this. We charge the President to relieve the Minister of Interior of his duties if he is incapable of discharging them. On a more strategic level, it is important for the APC government to begin to take implementing state policing, an integral part of its campaign promises seriously.
  • We restate, yet again, that a military expedition is a waste of time in the Niger Delta. Warfare against the population in the Niger Delta may unleash a lasting and drawn out insurgency. Information on redeployment of personnel from the North East to this operation, if true, could also spell a resurgence of Boko Haram who have been regrouping in Diffa, Niger Republic, waiting for just such an opportunity. We again call on the Nigerian state to look for workable and practical solutions towards enthroning a settlement that would address the deep divisions in the region. Such solutions start with enhancing the economic independence of the peoples of the region.
  • The Nigerian state has failed in its obligation to protect these people and it is a further indictment on the interior minister, the National Security Adviser and the presidency itself. We will continue to shine a spotlight on these attacks and charge the federal government to come to the aid of vulnerable communities in Nigeria. We urge these communities to exercise caution and remain vigilant.
  • Boko Haram is broken but it is certainly not finished. The governments of Cameroon, Chad, Niger and Nigeria must continue the efforts to ensure that the weakened Islamist threat is finally finished. Their fragile political, social and economic structures are riding in part on this. A final victory may have positive implications on Nigeria’s economy in the short term, particularly in the agricultural sector, despite the gradual return of normalcy because of prevailing economic headwinds.
  • We maintain that the National Assembly is a self-serving institution. They only devote energy to anything when they stand to benefit directly, mostly when there is a fallout on how to allocate public funds to their “constituency projects”. It has been a recurrent problem since 1999 and we have no reason to believe this current crisis serves the man on the street. It however feeds into our fears over the country taking on more debt. Such money will only find its way into “constituency projects” and other instruments, at the federal, state, and legislative level, which will do no good for Nigerians, but line the pockets of the political class.
  • While the idea of using debt to fund a fiscal deficit is good in theory, the optics of Nigeria’s submission to the global institutional lender are not pretty. This is a country that won a reprieve from the Paris Club of international institutional lenders in 2005 to the tune of $18 billion – becoming the first African nation to settle with its official lenders. This is a country which a historic problem with debt management. Debt accrued in the rollicking 1980s ballooned to more than $35 billion due to penalties and late fees during the 1990s. It is simply not clear if we have learned from our past mistakes and are now a fiscally responsible country. It is also not clear if this plan would even work. With Nigeria’s downgrading by rating agencies, it also means that our cost of borrowing has gone up. It is important that deployment of borrowed funds be judicious, to finance an expansionary fiscal policy with the view to lifting Nigeria out of the recession. Channeling the funds to recurrent expenditure will only dig the hole we have found ourselves in deeper.