28 Apr

The week ahead – Nothing is changing

The CBN Governor, Mr Godwin Emefiele, after a closed-door meeting with Senate President Bukola Saraki and legislative leaders, expressed optimism on Tuesday that the economic recession would be over by the end of June or the third quarter of this year, based on what he described as emerging positive economic indicators. According to Emefiele, these included the downward trend of the value of the naira in the parallel market against the dollar; a reduction in inflation and an increase in the country’s foreign reserves from over $27 billion at the beginning of the recession in June 2016 to over $31 billion now.

A coalition of Niger Delta militant groups has threatened to resume attacks, claiming the federal government has not fulfilled its promises that led to the agreement of a ceasefire. In a statement authorised by the leader of the Niger Delta Watchdog, ‘General’ John Duku; ‘General’ Ekpo Ekpo of the Niger Delta Volunteers, ‘Commander’ Henry Etete of the Niger Delta People’s Fighters and ‘Commander’ Asuquo Henshaw of the Bakassi Freedom Fighters, they asked the government to display commitment to their agreement by swinging to immediate action, or risk the destruction of oil pipelines in the region. The militant leaders called the visit of Vice-President Yemi Osinbajo to the region when President Muhammadu Buhari was away on medical vacation, a “big scam”. Oil minister Ibe Kachikwu had promised earlier this year to halt militancy in the region by the end of the year, on the back of government’s engagements with stakeholders in the region.

After spending almost two years in detention, the leader of the Indigenous People of Biafra (IPOB), Nnamdi Kanu, was granted bail by the Federal High Court in Abuja, in the sum of ₦100 million. Justice Binta Nyako said she was convinced that Kanu’s ailment was one that needed serious medical attention than the current medical facilities provided by the prison authorities could address. The judge ordered that the defendant produces three sureties on a ₦100 million bond each, one of whom must be a highly respected Jewish leader; the defendant having claimed Judaism as his religion, and deposit his international passports, including a UK passport, with the court. Kanu, Onwudiwe Chidiebere, Banjamin Madubugwu and David Nwawuisi were arraigned by the federal government last year on an 11-count charge bordering on terrorism, treasonable felony and illegal possession of firearms, among others. But the trial judge struck out six out of the 11 amended charges filed against the defendants on grounds that they lacked competence.

For the second time in 21 days, President Muhammadu Buhari, was again, absent from the weekly Federal Executive Council (FEC) meeting which held on Wednesday at the Presidential Villa, Abuja. Seeking more time to recuperate, Buhari directed Vice President Yemi Osinbajo, to preside over the meeting. The president’s absence from the FEC meetings has generated public interest leading to speculations about his health because that is where the developmental agenda for a given time is set by the government. Three weeks ago, Osinbajo presided over the meeting because, of what the Presidency termed, ‘Buhari’s engagement with other pressing affairs of state at his official residence.’ In a press briefing, information minister, Lai Mohammed had maintained that it was not unusual for the Vice President to preside over the council.

Suggestions

  • The potential end of the recession should be good news for ordinary Nigerians who have suffered under the slowing economy. However, this government and its central bank need to understand that the recession was a self-inflicted wound in the first place. For one, the implementation of the TSA, which in itself was a good initiative, resulted in a liquidity shock as money (over ₦5 trillion) was removed from circulation. At the same time the government’s failure to implement its 2016 budget meant the business value chain across the country was underutilised. Add to this the issue of FX scarcity, devaluation of the naira and the heightened inflation. It is important for lessons to be learnt so that this does not repeat itself.
  • We have repeated a number of times that the Niger Delta problem will not be solved with half measures and monthly handouts. We repeat our call for a comprehensive approach to resolve the problem through community ownership of mineral rights, and also devolution of powers through constitutional amendments. For the time being however, the FG should move to douse the tension, knowing fully well they have benefited from the relative peace that has ensured an uptick in crude oil output and sales, which has enabled a robust foreign reserves.
  • Nnamdi Kanu’s release has been celebrated by his supporters and human rights advocates as a triumph of justice with an important catch – his bail conditions seem unusually onerous. While bail conditions are ordinarily designed to be inconvenient in order to compel attendance during a court trial, Nigerian law requires bail conditions not to be set in such a way as to render them impossible to comply with. Furthermore, Kanu is entitled to the constitutionally guaranteed presumption of innocence until conviction. It would seem that the court in Kanu’s case may have set the bar for his freedom too high, a situation which his separatist group has latched on to amplify its claims to persecution, raised concerns in other less partisan quarters and offers the government’s case, both in and outside the courthouse no advantages whatsoever.
  • While we are not unmindful of the geopolitical implications of such a move, the current situation calls for President Buhari to resign and let Prof. Osinbajo, his vice, assume full presidential powers. At this point, there is only so much that Osinbajo can do when he is delegated assignments. The earlier referred to geopolitical implications should not place the Nigerian state in an uncomfortable position whereby the functions of the state and interests of the governed are put on hold.