The week ahead – In bed with uncertainty

Nigeria returned to growth in 2017 after suffering its first recession in a generation the previous year, data released from the country’s statistics office showed on Tuesday. GDP grew by 0.83 percent in 2017, after shrinking by 1.58 percent in 2016, which was its first annual contraction in 25 years, according to data from the Nigerian Bureau of Statistics. Africa’s largest economy, and its biggest oil producer fell into recession in 2016, largely as a result of low crude prices, and militant attacks on energy facilities in the Niger Delta. It returned to growth in the second quarter of 2017, but the recovery has been fragile since it is largely due to higher oil prices. The International Monetary Fund, said in December that, the economy remains vulnerable. Oil production rose to 1.91 million barrels a day in the fourth quarter from 1.76 mbpd in the same period of 2016, the Statistics Office said.

Nigerians are getting poorer despite the country’s slow recovery from recession, and economic reforms are urgently needed, the International Monetary Fund (IMF) said in a new report, according to Reuters. The IMF expects the government to “muddle through” in the medium term, and any progress could also be threatened, if elections next year consume political energy, and resources, the report said. Since emerging from recession in the second quarter of 2017, Nigerian officials have repeatedly boasted that they have set the economy back on track. The IMF said in the report, that the outlook for growth has improved but remains challenging. In the report, it identified risks to growth, including additional delays to implementing policies, and reforms ahead of the 2019 elections, security tensions, and oil prices, a fall in which could see capital flows reversed.

The National Chairman of the All Progressives Congress, John Odigie-Oyegun got his tenure elongated by the National Executive Committee (NEC) for one year along with other members of the party’s National Working Committee (NWC) on 27 February. The elongation was agreed upon at a meeting in Abuja, with the attendance of President Muhammadu Buhari, Vice President Yemi Osinbajo, and the Deputy Speaker of the House of Representatives, Yusuf Lasun, along with most of the party’s sitting governors, 37 APC state chairmen, and members of the party’s caucus in the National Assembly. According to the NEC, the NWC’s revised tenure will commence from 30 June this year, to 30 June 2019. In the last couple of weeks, there have been speculations that the party’s leadership might be sacked, due to perceived cracks within the party. The tenure of the current NWC will expire in June. Before now, there were issues on whether the committee should continue or be replaced. The party had been unable to hold its mandatory bi-annual non-elective convention, since 2014 as stipulated in its Constitution. President Muhammadu Buhari blamed the slow process of governance under his administration on the stand-off between his cabinet and lawmakers.

Joshua Osih, a 49-year-old lawmaker, has been elected as flagbearer of Cameroon’s main opposition Social Democratic Front (SDF). A native of the country’s southwest region, Osih is an aviation expert, who was the overwhelming choice of delegates at the SDF congress polling 1,021 votes representing 88.4 percent as against 134 votes (12%) polled by his closest challenger, Forbi Nchinda. He, however, remains the party’s deputy chairperson which is still led by founder Ni John Fru Ndi, 77. Ndi, who was the party’s candidate in the last election, said he was leaving the stage for younger politicians at the party’s congress held in capital of the northwest region of Bamenda.

Suggestions

• The past few years have shown that, the fortunes of Nigeria’s economy are tied to global oil prices, something that is largely out of the government’s control. The amount of oil that can be produced daily though, is largely within the government’s control. The recession set in when oil revenues dwindled, following the drop in oil prices, and production as a result of militant activities in the Niger Delta. The Buhari government blamed past administrations for their failure to diversify the economy, then promptly failed to diversify government revenues, which is where the problem really is. Now, the economy is out of recession, and the government is praising its “economic policies,” ignoring the fact that the recession ended on the back of increased oil revenues following the rise in both global oil prices, and Nigerian oil production. At some point, Nigeria will have to face up to the fact that we cannot continue to hang the our entire economic fortunes on a single commodity.
• We do not believe that this IMF report catches any informed observers by surprise. For the Nigerian, purchasing power has been virtually halved over the last 2 years, and disposable discretionary income which was low before, has been wiped out for most of the populace. Most Nigerians who are not yet below the poverty line, are only one calamity away from it, and the potential for calamities befalling a Nigerian is very high. Regrettably, the government of the day is more interested in politicking towards the 2019 elections, than in making real attempts to assuage the suffering of Nigerians. Disaggregated, the much touted recovery is driven by the rebound of oil prices. We agree with the IMF, that the government will muddle through for now.
• The decision by the APC to extend the tenure of the NWC, has simply kicked the can down the road. A convention would have widened the already visible cracks within the party, and with elections very close, that is the last thing the party needs. With this extension, they will go into the elections with some unresolved bitterness, a situation which will almost definitely lead to some backstabbing. The absence of Senate President, Bukola Saraki, who was at the Code of Conduct Tribunal, House Speaker Yakubu Dogara, who was presiding over plenary, and Bisi Akande says a lot about where the party is headed. However, a convention after the 2019 elections, buys the party, room to paper over the cracks, win the 2019 elections, and then resume their internal wranglings ahead of the 2023 vote.
• The SDF primaries come amid a degeneration of the security situation in Cameroon’s restive Anglophone regions. A prominent official was kidnapped by separatists outside Bamenda last weekend, the second in ten days, prompting the North West regional governor to extend a 2-week long curfew that has been placed in both regions because of the ‘growing threats of secessionist activists against the forces of law and order’. Nigerian authorities also released on bail, two Cameroonian separatists, John Ojong Okongho, and Nsoh Nabowah Bih, who were detained by police last week. Okongho and Bih are among five separatist leaders who were arraigned in Abuja last Wednesday, and were previously thought to be among the 49 deported to Cameroon. Politically, Cameroon has a busy electoral year in which they are set to pick senators in late March, followed by council, legislative, and presidential elections at a yet to be determined date later this year. Osih’s election is unlikely to pose a threat to Biya or change the established political status quo in the home regions, guaranteeing that this period of uncertainty will persist for sometime.