The presidential candidate of the Abundant Nigeria Renewal Party, ANRP, in the February 23 presidential election, Tope Fasua, speaks about things that President Muhammadu Buhari must do to boost Nigeria’s economy in his second term in office. In the concluding part of the interview with Akanni Alaka, which The Nigerian Xpress published last week, Fasua, an economist and author, urges the president not to take Nigerians and the economy for granted if he wants to make the desired impact.
Now President Buhari has been declared the president-elect and without prejudice to the outcome of the ongoing challenge of the election, he is going to be sworn in on May 29. Looking at the way he has performed in his about-to-be-rounded off first term of office, what are the things you think he should do differently in this fresh tenure?
What he should be doing differently is obvious. We are hoping that he should make his appointments in time. He should not take the economy and the people of this country for granted. Majorly, the problem he has is that he takes people for granted too much. When he came in the first time, it took him almost seven months to appoint ministers and he used to say then that ministers are just noisemakers, that he didn’t need them.
But if they are noisemakers, what other things is he putting on ground to make sure that the country is moving forward? So, he absolutely has no clue and I don’t think he wants to have a clue. I think he is comfortable running the government around his clique and trusting people to be able to do things. He believes that all he needs to do is to be the figure at the centre and seeing many people saying ‘this man is a legend, he is this and that’ and everything will just flow. But that hardly works. You see, development is constant, intense; it is about following the money to where you need to get it to, putting pressure on people to get results achieved. Development is not about lethargy, standing aloof from the problems and just hoping that things will play out.
Development is about even when you trust someone so much because he is your brother, you have known him for 70 years and all of that, but by every means, you must put structures in place to ensure that he actually gets the job done. Development is also about caring for the most vulnerable and understanding and having a vision that life should be a lot better than it is right now. So, if you don’t have an eye out for a child that can’t go to school, or people who don’t have access to hospitals and so on, there is no way you can achieve development.
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The president was interviewed by Kadaria Ahmed and in that interview, a certain gentleman asked him a question – his name is Abubakar Usman Jau – a lawyer. He asked the President a question about the Almajiris and he said, ‘Mr. President, I believe you are the one that can tackle this Almajiri problem’, but Buhari was asking Osinbajo, “What is he saying?” And the man insisted until the president actually understood what he was saying. But the president’s answer was off mark.
The president said it’s a problem for local governments and that the local governments should shout so that the states would give them their money. And I’m like this man is not serious. You cannot have 13.2 million children on the streets and another 20 million in the classrooms, who are not being taught and you said it is a problem for the local and state governments. That is a global emergency.
There is no place they are serious in the world now where they are deliberately producing ‘maiguards’ and ‘mai loads’ in the market – people who carry loads in the wheel barrow. There is nowhere – this is not to say that those people would not exist, but you need to begin to deliberately reduce the numbers, so that the ones that may remain in the business will probably get a little higher pay and have a lot more work. But you have no right in 2019 to be breeding new ‘maiguards’, vagrants, political thugs – mindless people whom you want to be available so that your own children can come and use them.
This issue is going to the United Nations and I am going to be needing people to assist me on this because I realise that the president doesn’t seem to care about it. These are the things that should change if the president can change. But they said you can’t teach an old dog new trick. I am not sure if the president can change from who he is – it is too late. I doubt if anybody can change him, but I wish us all luck.
What should he do in terms of the economy?
The economy needs to be prioritised. But I am not sure President Buhari actually cares about the economy per se. I am not sure that he cares about the rigour that it will take to get the economy working on a certain footing. I was proposing that Nigeria should be growing at 15 per cent. But as a matter of fact, most people who are even supposed to be economically savvy don’t understand the urgency of the moment and the reason we need to be doing that. I am still trying to convince a lot of people, who are supposed to be ‘economic expert’ on why are we doing half the size of the budget of Angola?
This year, Angola is doing a budget of $36 billion and it is already in place. But Nigeria is budgeting $28 billion for 190 million people and we are still arguing about the budget till now. By the time they approve it, maybe in June or July by the next Senate or whatever, then they will do only 30 per cent of the capital allocation. So, we need to be moving a lot faster, Buhari has to find a sense of urgency, I don’t know where he is going to find it from. If he gets younger people, that will be good for him, though he also said that people should not rejoice, that he has a constituency to take care off, which is the old people – great stuff. If he also wants to continue to run a gerontocracy – where most of the people in his government are old people, good for all of us.
Then, he needs to get out of this idea of basing everything on crude oil. As a former petroleum minister, I am not sure he was very wonderful because of some of the gaffes that he has made about that sector. For example, he gave a talk recently when they were doing some celebration dinner in the Villa, whipping up some sort of sentiments. He said people should think about how much money PDP wasted in 16 years with crude oil. And he said at 2.1 million barrels a day and the average prices was $100 and for 16 years, go and multiply it, that’s the money that the PDP wasted for 16 years.
But whereas I don’t have a sentiment for PDP, but that kind of information is dangerous and it cuts both ways. Number one, even, if crude oil was rain water, you would have needed money to buy basins and put it under your roof in order to collect it. It will cost you money So, how can you do that kind of straight-line discussion and tell people to go and do the calculation, that that is the money that the PDP wasted, when in actual fact, according to NEITI, about 65 per cent of the selling price of crude go to cost. So, how can you say you are a former petroleum minister and you don’t know that you have to mark out cost from crude oil production? I then went on and got information about the average price – I got the price from 1978 up till date, the average yearly prices.
The average price between 1999 and 2016, the 16 years he was talking about was $62 and not $100. So, that was misinformation on both ways. But the man has to first of all get his minds off crude oil; we can’t be looking for crude oil in Bauchi, Chad Basin and all of that, when we abandoned our children. Children are much worthier in terms of value than crude oil. Imagine a child in this country creating an idea that the world buys into? You know how much he will draw into Nigeria? Look at all these young boys – Larry Page, Mike Zuckerberg – young boys, who have created things that are bigger than the Nigerian economy. So, if we have 10 of such, that means we can have this economy growing times 10.
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So, the man should get his mind off crude oil because he is not even doing well at the business in the first place. If we are serious, this country can grow at 15 per cent. We should be able to grow our budget right now from eight trillion to 15 trillion.
The economy is growing at just about two per cent now, how can we leapfrog to the 15 per cent you are talking about…?
They said 2.3 per cent the last time, but they are just deceiving themselves and, of course, the population is growing at over three per cent. What steps can we take? Well, you have to look at the economy in terms of strata and sectors. Let’s leave the private sector now because they need a certain impetus. This is an economy where everybody wants to be an entrepreneur, being encouraged to go and make money anyway they can. That looks progressive on the face of it, but it is actually destructive when you think about it because there is actually nothing wrong in doing a nine to five job and there is nothing wrong if an average Nigerian boy or man finds two jobs. That is the way it is done everywhere else.
And then, you now maintain your lane because there is nothing that the man who is a billionaire can afford, that you cannot afford. There is no food he can eat that you cannot eat, there is no where he can go on holiday and you cannot find your own level and go if that is the case. That is how the world is run. But right now, what we have here is a scenario where a few people have money and everybody else down is hustling, trying to get rich or die trying. You now see young boys, who should be of productive age doing 419 and all of that. But the public sector can be the impetus. We are talking about growing our economy by 15 per cent. Let’s start from the angle of budgeting alone.
They said there is no money to fund the budget, but there is money. It could just be because we are not organised, those people who should actually be leading and showing the right examples are not ready. If we say pay your taxes, the big men are the ones that will be dodging. In fact, they dodge all the time; they are the ones that break the rules, get the concessions. But we have to be firm. If we are firm in terms of collection of all our revenues, we will be able to move this budget from eight trillion to about 11, 12 trillion. Now, by the time you used that money judiciously to prime the economy, local content and so on, you will see a boom in the economy. You can then begin to trace it down to different sectors.
But the bottomline is that I know we have the revenue in this country. If you say we don’t have, then you will have to explain how Angola was able to find the money, given the fact that they are doing the same crude oil. How is South Africa able to find the revenue? How is Kenya able to budget 29 billion dollars for 15 million people when we who claimed that our economy is the biggest in Africa can’t do more than 27, 28 billion dollars? So, the first place to start in order to get that kind of growth rate is actually to go back to our budgeting, to our revenue collection.
By the time we are able to get the people to conform not only in terms of taxes, rates, duties, levies, and fines, but in everything that are supposed to come to government’s coffers. For example, if you look at the South African budget speech that was read on the 20th of February this year, we will see that they actually listed excise duty. So, this year, the excise duty will move from this to this on beer, from this to this on cigarettes. Let’s say we have 200 million people and hundred million are men, let’s say 10 per cent of men are smokers – that means 10 million men smoke in Nigeria – we could get up to that number in some parts of Nigeria where they smoke a lot.
Let’s say each of them smokes about five sticks in a day – that’s 50 million sticks of cigarettes get smoked in one day. In 10 days’ time, that is 500 million, in 100 days’ time, that is five billion sticks of cigarettes multiplied by three that is 15 billion sticks of cigarettes. So, just round it off, 365 days, that’s about 20 billion sticks of cigarettes. Now, on 20 billion sticks of cigarettes, if all we levied was N5 on each stick of cigarette, we will get about N100 billion. That is revenue. And in terms of cigarettes and alcohol, Nigeria is actually, perhaps, where you can get them at the cheapest prices in the world.
But the manufacturers have been making noise that even now, the new rates of taxes on alcohol and tobacco products as imposed on them by the Buhari government some months ago are too high…
Don’t mind them, they are always making a noise. When you listen to them, you see them pushing this extreme capitalist ideology. But what they seem not to understand or don’t want to understand is that if there is more money going round, especially at the base of this country and government was responsible to the most vulnerable and put money in the pockets of the people for work done, they, as Manufacturing Association of Nigeria or Chambers of Commerce, will feel it a lot more, they will have a lot more money.
Whatever money you give to the people at that level for work done – not free – that money will come back to them. Every time they are talking of increased minimum wage, they say ‘no, no, we can’t, let’s increase duties on cigarettes, they will say no, you can’t do that, anything you want to do to reflate the economy, they don’t want to have any part in it. They come with a shallow perspective of we just want to make more money. What money are you making? The economy actually hasn’t started.
The manufacturers always argued that they spend so much of the money they are making to provide infrastructure, which ordinarily should be provided by government and, therefore, the burden of tax should not be so much on them…
So, what they are doing in effect is that they are in a box and they are keeping all of us in that box. I am coming with a message that we can liberate ourselves. You say you are doing infrastructure – that is fine. Just be keeping the records. But we are saying we are trying to see how we can re-arrange this economy from the level of eight trillion; we are beginning to think of 15 trillion, so that if everybody fulfills their obligations here and there, we can put the money back into the system.
At the end of the day, we are going to pay you back for whatever it is that you are spending. But you should be trading a lot better. The same people resisted the African Continental Free Trade Agreement; they said we are not ready. They were able to convince government not to sign then.
But should Buhari sign the AFCTA in this his second term?
We should be the one pushing that agreement. The fact that we don’t have infrastructure and we are not a serious people should not stop us. Whatever shock treatment that would get us to be serious in this country, we should do. We are not talking about trading EPA. The Europeans can be a bit crafty, so we don’t want to do that so quickly. But how can we be afraid of trading with Niger Republic, Guinea Bissau, Botswana and Rwanda?
I am a very careful person when it comes to all these trade, bilateral agreements and all of that. But what is important is that Nigerians must find a way to be part of AFCTA. There is no course in Harvard, MIT, Imperial College, London School of Economics that you will not find a Nigerian there. All those things that we think we know, it is time to use them for the growth of our country.
You talked about getting more revenue for government, but what about curbing government’s expenses, which some have described as total waste like fuel subsidy?
Fuel subsidy is a total waste. But it is not particularly so big a waste; it is just part of the mediocrity. They made a provision this year of about N305 billion in the budget for fuel subsidy. That figure is significant because the entire budget is insignificant. Then, why are we talking about subsidising crude oil? When we argue this thing, some of the people who worked in and around government and believed so much in them tell us how that impacts everybody. But the truth is, does it really? Then, I found out the other time that palm oil is about four or five times more expensive than crude oil. So, one day, I said what exactly is the price of crude oil? At $60, multiply by N305, one barrel of crude oil is N18,300.
Now, N18,300 divided by 159, because 159 litres is inside one barrel. That costs you about N150 per litre. Then, if you went out there and buy palm oil, you will see that a four or five litre jerry can is N2,000, meaning that one litre of palm oil is, at least, N500.00. So, why are we not subsidising palm oil? I am not talking about giving people money in their homes for palm oil. I mean, what is the government doing for the palm oil industry, for instance? Or the agriculture sector as a whole? I believe that more homes use palm oil than use petrol. Why are we putting this petrol thing up and making it to look as if it is the end of the world? If you look at any government budget in Nigeria, the only assumption is price of crude oil, benchmark price, production per day and that is it. When you want to do a proper budget, you should spend a lot of time populating the revenue side of the budget. Crude oil, fine.
What about the solid minerals? Do the assumptions there. Then, how much can we get from FAAN, NCAA, NPA, NCC? Put it there, even if it is N2. What they do now is that they put the crude oil and all of these MDAs are allowed to make money and spend. An agency will tell you it is going to make N200 billion this year and they will say bring your expense budget and it will put N199 billion there. Then, the remaining N1 billion, you can’t even get it. Luckily, we now have a TSA, but still at that, at the end of last year, the Budget DG read a riot act to some of these MDAs because as at the end of last year, we got about N2.7 trillion in terms of real revenue for the year. But even at that, as at the end of the year, some MDAs still owed Nigeria another N2.7 trillion.
Then, you now ask why are we sending all the crude oil for refining abroad, even the one we are supposed to use here. What is the big deal about refining it? If you go to Niger Delta, you will see all these boys, some of them who even didn’t go to universities, but they are refining crude oil. They just put fire behind a huge vat of crude oil, put a few pipes here and there and the diesel is draining here, petrol is draining there. The only university to refine crude oil in any capacity in Nigeria is ABU in Zaria. But look at the source of the crude oil? So, what has stopped UNIPORT, UNICAL, UNIUYO, Federal University, Otuoke, Niger Delta University from developing capacity to even manufacture refinery in a small scale just the way these boys in the Niger Delta will bring one huge thing like a tanker, cut it in half, put the crude oil inside it, begin to heat it with fire.
They are destroying the environment entirely. Are we saying we cannot fabricate something at the university level by our engineers that will be neater than what those boys are doing at the Niger Delta so that, at least, the 455,000 barrels that is allocated for use locally, we can get 100,000 of that and refine it ourselves? Number two, must we really sell petrol at the same price in the whole of Nigeria? Do we need Petroleum Equalisation Fund, PEF, or should it be collapsed into the NNPC? I don’t believe in PEF. I don’t believe we should sell petrol at the same price all over the country. It is not done anywhere. After all, we are importing petrol from Maradi in Niger to Nigeria. If we can get it cheaper at that place, sell it in Nigeria.
And even if the price of petrol becomes N200, it is not a big deal. Let it be N500, but the average Nigerian youth that comes out of university, does he or she have a job? But this is a country where the jobs are there; they just refuse to give it out. But they created these nice, nice, parastatals for themselves and their children. We are running a class society here – a society of slaves and masters run by the mafia in government and outside of government. You created all of those nice parastatals and you put your own children there to be earning money that they cannot even finish spending.