12 Aug

The week ahead – Misplaced statements have unintended consequences

The National Security Adviser, Babagana Monguno has accused two leading fertilizer and chemicals company in Nigeria of sabotaging national security, and the economy, by being conduits through which insurgents, especially Boko Haram terrorists and Niger Delta militants, obtain explosive materials in order to wreak havoc the across the country. The companies were also accused of unpatriotic acts and abuse of the government’s goodwill because about 71% of 2.05 million tonnes cumulative annual production of fertilizer manufactured by these companies are exported “to the detriment of the national economy.” The same charge of economic sabotage was also echoed by Audu Ogbeh, the Minister of Agriculture, who threatened to sanction the companies if they continue to export fertilizer abroad.

Though attempts have been made to assure Nigerians that there are no plans to increase the price of petrol, the Punch newspaper reported that the actual price at which the product should sell at filling stations is ₦151.87 per litre. This “realistic” price is more than the maximum ₦145 per litre fixed by the Federal Government on May 11, 2016 when it liberalised the downstream oil sector. This, real price, is due to the continued scarcity of US dollars Dealers explained that the ex-depot price of petrol is ₦133.28 per litre, and that the marketers are doing their best to manage the situation. In a move to avert a price increase, the government conveyed a meeting of partners in the downstream oil sector on Tuesday, which was held at the headquarters of the Petroleum Products Pricing Regulatory Agency in Abuja. The Group Managing Director of the Nigerian National Petroleum Corporation, Maikanti Baru, insisted after the meeting, that there is no plan to increase the price of petrol. Baru said he has not been directed to increase the pump price, and that any increment is based on recommendation from the regulatory body.

More than 93 million Nigerians are currently facing food insecurity, Phillips Consulting’s ‘Household Economy Survey’ has established. The survey, which assesses the socio-economic state of Nigerian households to determine the proportion of vulnerable households in the country, found a compelling relationship between food insecurity and unemployment. It found that 51 percent of Nigeria’s population of 183 million (which amounts to 93 million) “cannot boast of availability and adequate access at all times to sufficient, safe, nutritious food to maintain a healthy and active life.” A recent survey by BusinessDay and NOI Polls showed that up to 66% of Nigerians have been compelled to adjust the feeding patterns of their families in the face of rising costs, and delayed salaries.

The Economic and Financial Crimes Commission arrested political blogger, Abubakar Sidiq Usman on August 8. According to a statement, Usman was in violation of some sections of the 2015 Cyber Crime Act, which borders on cyber-stalking. The arrest came following the publication of scathing criticism about the prosecutorial agency on Usman’s blog. The arrest was widely condemned by human rights practitioners, digital rights watchdogs and spun a hashtag on social media – #FreeAbusidiq. He was released two days later.

The Attorney General of the Federation and Minister of Justice, Mr. Abubakar Malami (SAN), has directed various Federal Government agencies with powers to prosecute crimes to compile list of pending cases they are currently handling. The AGF said the National Prosecution Coordination Committee should collate the cases and issue advice to him on what action to take with respect to the cases. The Special Adviser to the AGF on Media and Publicity, Mr. Salihu Isah, who doubles as the spokesperson for the NPCC, said this in a statement on Tuesday. Isah said the minister met with the various relevant agencies of the Federal Government in his office on Monday. He listed agencies, whose representatives were present at the meeting, to include the Nigeria Police Force, the Department of State Services, the Economic and Financial Crimes Commission, the Independent Corrupt Practices and other related Offences Commission and the Federal Inland Revenue Service.

Senator Isa Hamma Misau, representing Bauchi Central has said the Boko Haram insurgents are establishing a new base in Bauchi state. He said the insurgents were relocating to the area from their Sambisa Forest base, and have started consolidating in Burra Forest in Ningi Emirate Council of his constituency. He also said, specifically, that Boko Haram insurgents are currently using the forest, a very large swathe, extending to three states as a base from where they unleash terror on people, and mentioned that these activities necessitated the establishment of a Police division in Burra. According to Misau, the terrorists kidnap people daily, and receive between ₦3 million and ₦5 million as ransom payments.

Suggestions

  • The fertilizer companies in question have denounced these accusations. Our worry however is the threat of crackdown on companies that choose to sell their goods overseas in a nominally free market economy like Nigeria. In a time of foreign currency scarcity, having a government that threatens companies simply because of their decision to export, is both dangerous and antithetical to sound economic counsel. Policy makers cannot on the one hand say they want foreign investors to come in, and at the same time make the business environment unfriendly to those that have come.
  • When the price of petrol was moved and pegged by the government, we warned that hailing it as a “subsidy removal” was false. We warned that once the market price reaches the peg, one of subsidy payments or scarcity would return. We also cautioned that maintaining a price template for petrol after floating the exchange rate was not a sustainable fiscal policy. It seems the fuel price policy is just as muddled as our fiscal policy, and in a way it will be. The constant intervention of the Central Bank in the interbank market – by overt and covert means – has been motivated in part by the need to ensure that the retail price of petrol remains within a band of ₦135-145. As voices in the nation’s downstream sector are increasingly vocal about the squeeze on profit margins from an unsustainable system, it will become vital for the government to sit down with industry operators and fashion out a more efficient regulatory mechanism. The government also needs to be honest in its dealings with these economic actors – one of their primary complaints is that government’s assurances of providing them access to foreign exchange to aid their operations have gone down the sink.
  • According to the United Nations World Food Programme, people are considered food-insecure when there is no “availability and adequate access at all times to sufficient, safe, nutritious food to maintain a healthy and active life”. With the general insecurity of Nigeria’s main food growing regions, warnings (and in some cases, instances) of flooding, inefficient and outmoded agricultural practices and poor distribution and transportation system, it is probably a surprise that the figure stands at half of the population. Government, policy-makers, institutional stakeholders and agribusiness must come together and prevent what is sure to be an impending crisis if current conditions persist. The current government fixation on banning importation of staple food items to stimulate local production is not a policy approach that is beneficial to Nigerians and the government must review such policies in order to forestall the impending food crisis in the nation.
  • The Paradigm Initiative of Nigeria best summed up the import of the EFCC’s clearly reckless exercise of its new-found statutory powers. “The arrest of blogger, Abubakar Sidiq Usman, by heavily armed operatives of the Economic and Financial Crimes Commission (EFCC) yesterday, August 8, 2016, in his residence has again highlighted the need for conversation on Digital Rights in Nigeria. Of course, this is not just a Nigerian conversation considering recent events that have seen government limiting the digital rights of citizens in Uganda, Ethiopia, Iran, Brazil, Syria, India and other countries. For Nigeria, this is not the first time that provisions of the Cybercrime Act have been used to intimidate or arrest bloggers and journalists.” The law under which Usman was arrested has been criticised as a problematic, inelegantly drafted law with confers uncomfortably vague and wide ranging powers on prosecutorial services, security agencies and even the President. A review of this legislation would be a welcome first step in addressing the concerns of an increasingly vocal and social media savvy citizenry. If the government won’t do it willingly, it will be forced to – there are already two subsisting law suits seeking a review of its most vexing sections.
  • Quality and thoroughness of prosecution has always been one of the points at which anti-corruption fails in Nigeria and the minister has rightly identified this. The NPCC is a laudable idea in theory and so far, the government has made the right noises about judicial service reform – it has given the NPCC, the nod to take over the trial of high profile public officers, especially former governors, alleged to have looted their state treasuries. Continued emphasis must be placed on delivering real outcomes in order to shatter the widely held (and accurate) perception that our criminal justice system is slow, turgid and rigged towards serving the interests of a well moneyed elite.
  • The information on Boko Haram’s new location given by Senator Misau is important, and must be acted upon. Ordinarily, a national security strategy would have taken care of events like the above but we do not have one. The case by case approach to our national security crises is not sensible, and we call on the national security authorities to stop the current unfolding national anarchy.