Some random thoughts on Nigeria

I have decided to share some random thoughts and questions that have been playing in my head with you this week. In no particular order, here they are.

In Thailand rice farmers were unhappy and vowed to vote against the ruling party in the recent elections because they felt their subsidies were too low. In India, the rice farmers were unhappy and vowed to vote against Narendra Modi in the recent elections because rice prices were too low. In China, anytime the Prime Minister visits a rice farm, the farmers complain that their prices are too low even though the WTO recently ruled against China for over-subsidising its rice farmers from 2012 to 2015. It is difficult, if not impossible, to find a country where rice farmers are happy and not asking for more subsidies. And these are all the top countries where most of Nigeria’s rice comes from. Given that the Nigerian government has bet so much on this policy, a useful question to ask is this – what will success look like for its rice policy? That is, what is the outcome that the government is aiming for to make its efforts a success?

No matter how good you are as a talent spotter, picking a cabinet to run a government is never going to be an exact science. Given that it all boils down to human beings, who can be incredibly inconsistent and disappointing, it is not impossible for someone to be a success on paper for a ministerial role and a failure in reality. It is for this reason that cabinet reshuffles were invented – to allow presidents or prime ministers to quickly correct errors. For example, even before the end of his second year in office, Barack Obama had made at least 3 changes to his cabinet. Given all of this, what is the point in waiting so long to choose ministers? Could it also be that because he spends so long choosing his ministers, President Buhari was so focused on getting it right the first time and this was why he never reshuffled his cabinet in his first term?

Not too long ago, the Nigerian government somehow ran on $20/barrel oil. It wasn’t effective as that $20/barrel had to cover salaries, capital expenditure and of course corruption. But somehow today, Nigeria cannot seem to pay salaries alone with oil at $60/barrel. The cause of this is a variant of what Margaret Thatcher once called the ‘Ratchet Effect’ – when the state fails, it gets more power to ‘correct’ its failures. In March 2011, oil prices hit $100/barrel. They pretty much stayed there until August 2014 when prices began to crash. In other words, the ‘boom’ lasted for less than 4 years and has now been over for almost 5 years. Yet in those short years of boom, the Nigerian government expanded rapidly and even continued to expand over the last 4 years, long after the boom was over. Or to put it another way, the size of the Nigerian government goes up like a rocket and comes down like a feather. In light of this, is it not better for Nigerians to commence serious prayers and dry fasting to plead with God to give us just one more oil boom?

In the last one year, Lagos has witnessed an explosion in the number of companies offering ride-hailing services for bikes. That is, Uber, but for Okadas. A lot of foreign capital is pouring into these businesses and some reports suggest it could be a billion dollar business in a few short years. Commuting by motorcycles is of course of a feature of countries with no mass transit systems like trains as transporting people on motorcycles is one of the most inefficient forms of mass transit out there. Lagos is now on its 4th governor since it started the Light Rail project. We can safely conclude that given the time taken by the project, there are now vested interests – those who have built a business to fill the gap left by non-availability of trains – who have the time and money to delay or block the project for as long as possible. So if Okada ride hailing becomes a billion dollar business, will the delays to the Light Rail project increase or reduce?

For the past 21 years, Nigerians have been fed a steady diet of news about just how much money General Sani Abacha stashed away abroad as military leader. As recently as last week, another stash of £200m was found sitting somewhere in Europe. He is definitely not the only person who has robbed Nigeria in the recent past and hidden the loot in Europe. Many other looters have also been watching this 21 year movie along with the rest of the country. Do you think they have been taking notes and implementing measures to ensure that what has since happened to Abacha’s loot never happens to theirs? Has this 21 year drama been like ‘expo’ for them?


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