DISSECTING NIGERIA'S BORROWING SYNDROME

by FRED NWAOZOR

Taking into cognizance the trend of events among Nigeria’s entities and individuals, one might be quick to assert that the country is synonymous with borrowing. On the other hand, someone might also be of the view that no one could currently live or survive in Nigeria without indulging in borrowing.

Penultimate week, precisely on 19th November 2024, the leadership of the National Assembly (NASS) announced to its members during plenary the receipt of a letter from the Presidency, requesting to borrow the sum of 2.2 billion dollars externally. In the letter, the President expressed that the targeted fund was for the complete implementation of the 2024 budget. He therefore stated that the appeal was in line with the provisions of Sections 21 (1) and 27 (1) of the Debt Management Office (DMO) Act, 2003 and the approval of the Federal Executive Council (FEC).

The President further clarified that the proposed loan of #1.7 trillion naira, equivalent to about $2.2bn at the 2024 budget exchange rate of “one dollar to #800, was to partly finance the budget deficit of #9.179trn. He disclosed the fund was needed to give more strength to the ongoing projects and programmes’ implementation as enshrined in the said budget, which were designed to stabilize the economy.

According to him, the key projects to which the proceeds would be deployed formed priority sectors of the country’s economy, such as power, transport, agriculture, defence, and security. He added it would equally increase the accrual to the external reserves as the proceeds would be directly received into the account of the Central Bank of Nigeria (CBN), thereby supporting the naira exchange rate.

Without equivocations, borrowing has become a norm among not just Nigerian political leaders, but on the African continent at large. It’s ostensibly endemic in our bloodstream, that, successive leaders have seen it as the only means of survival for any government in power. This is, no doubt, a pitiable point we have collectively found ourselves as a people.

I beg to be corrected; this isn’t the first time the incumbent administration would request for a loan to finance a budget, barely a year plus it came on board. Yet, some defenders of the government are busy trying to convince credulous Nigerians that the President has been more concerned about servicing the country’s already-incurred debt. I wonder how we intend to reconcile a situation whereby an individual or entity is servicing an incurred debt, but still requests to borrow more money to finance his/its budget for a given fiscal year.

Aside the fact that such a scenario, as mentioned above, appears or sounds paradoxical, it simply seems not unlike a situation where the led are being told by their leaders that more employment opportunities would be created for the citizens, yet most of those who are already gainfully employed are being relieved of their various jobs unannounced, citing inability of the government to sustain their wages.

It’s quite ridiculous and unheard of, that, when the Nigerian debt index has abruptly triggered to over 120 trillion naira, the government still possesses the moral ground to seek additional loan, not even internally but externally. Sometimes, I do not hesitate to ask myself how the lenders see or perceive Nigeria among the Comity of Nations, because If I were in their shoes, I wouldn’t further release any dime to the country in the name of lending. One who regularly borrows but refused to refund, or has no plan to pay back, doesn’t deserve any other lending hand.

I’m ashamed, our sister nations might be laughing at us, even though they are also chronic borrowers. Of course, two persons could be characterized by same unruly behaviour, but when that of the other becomes so extreme, his counterpart may be tempted to laugh at him not minding they both share similar lifestyle.

Another question that bothers me, or that’s earnestly begging for a candid answer is, having totally removed subsidy from petroleum products by the government, as we were informed, why then is the country’s coffer still apparently bleeding despite the huge savings achieved thus far? Does it imply the citizenry is being misinformed, or there’s something wrong somewhere, which the governed are yet to know? For Nigeria to heal of her present economic disease that requires a lobotomy, these disturbing enquiries must be candidly addressed by the government.

Let’s economically take a closer look at the actual amount involved in the loan request. Since it’s an external borrowing, the fund would be released to the beneficiary in foreign currency, precisely the US dollar. US$2.2bn is targeted to be borrowed. It’s estimated to be about #1.76trn, using #800 as the pegged exchange rate to one dollar in the 2024 budget.

In the actual sense, the naira equivalent of the proposed loan ought to base on the current economic reality, considering the fact that the present official exchange rate to a dollar has doubled (about #1760) compared to the figure stipulated in the budget. It is even more than twice the aforementioned amount (#800). In view of this prevailing reality, the naira equivalent of the external loan being requested by the Presidency should rather be about #3.8trn, contrary to the #1.7trn as was reported in the letter from the Presidency.

In other words, Nigeria intends to borrow additional approximately 3.87 trillion naira at a time when the country’s public debt, both external and domestic, had catapulted to almost #134.3trn (about $76.3bn) as at the second quarter of 2024, indicating a growth rate of 24.99% on a quarter-to-quarter basis, which marked the country’s highest debt-to-GDP ratio ever; at a time when her teeming citizens are struggling to feed, or could barely afford two-square meal per day; at a moment when small and medium-scale business ventures are liquidating on a daily basis; at a period when the economic quagmire of the followers seems irredeemable; at a time when the country’s inflation rate is about 29.90%.

If we are to be truthful to ourselves, we would comprehend that at such a critical and scary moment like this, the government is rather expected to sit at home and consider how to deeply think outside the box towards redeeming the shattered image of the Nigerian State. Our leaders must take into cognizance that a 50 naira note is almost presently useless in Nigeria’s currency.

At such a tight situation of this kind, my worry mostly lies with the members of the NASS, who are constitutionally referred to as the lawmakers. It’s noteworthy that the loan being sought was unanimously approved by the senators barely 48 hours after the request letter was read on the floor of the Senate. I strongly see no reason every requested loan by the Presidency must be approved by the legislators, irrespective of the consequences it bears. Does it signify they can’t – or have no immunity – to say NO, even when the reason for the expected rejection is so glaring?

The story remains the same in all the states across the federation. Each of the State governors has resorted to borrowing as the only means of survival, in spite of the astronomical hike in taxation in their respective revenue generations. The most painful part of it is the way and manner the legislators swiftly give any loan request an attention, without critically analyzing the factors that informed the financial demand from the governor. Similar melodrama occurs, on a regular basis, at the national level.

The Presidency might bear a genuine intention as regards utilization of the sourced funds, but the bitter truth remains that incessant borrowing has never done anyone, either a person or group, any good in whatever perspective it’s being considered. We were notified that the loan, if eventually accessed, would be channelled into critical sectors such as power, agriculture, security, and transport, but this wasn’t the first time Nigerians were served with such a palatable diet, yet in the long run, these sectors would remain unattended to.

More so, there’s reportedly a budget deficit of #9.179trn and what the government is about to borrow is just #3.87trn, which is less than 50% of the deficit. So, how does it intend to source for the remaining fund towards financing the 2024 fiscal year? Perhaps, in the nearest future, the Presidency might come up with another loan request.

In a clear term, borrowing isn’t the remedy to the Nigeria’s economic woes; rather, an avenue to further weaken the bleeding and epileptic economy. It’s high time we gave this prevailing syndrome a rethink before it consumes the entire system. Think about it! frednwaozor@gmail.com

N.B: Published in NewTelegraph Newspaper on 27/11/2024

The Best and Beast in Leadership Positions

By Fred Nwaozor

Every leadership position, irrespective of level or status, is characterized by the good, bad, and the ugly. Inasmuch as how juicy and palatable it might taste, the ordeals surrounding the highly-spiced diet might take the bearer off the track, thereby making him/her dine with ‘a spirit’.

Anyone who is yet to assume any position of authority may not actually comprehend the tune of this analysis. But if you have experienced any, one wouldn’t be far from the truth if he says you would be smiling while reading this, because you had personally dined with the aforementioned spirit and probably conquered.

While growing up, I saw myself as one who was naturally imbued with leadership skills; and in my own little way, I was showcasing it. I could informally assemble members of my peer group, and effortlessly counsel them. I was enjoying the task and relationship, not until one fateful day when one of us displayed an unforgettable character just to discredit my person.

The essence of the above reference is to indicate that, as little as we were, someone was already envying the service I was rendering to my childhood pals, even though I was obviously gaining absolutely nothing from the position. Meanwhile, this topic is informed by the need to highlight both the pleasant and unpleasant features of a leadership post, hence let me not be so quick in discussing the latter.

Leadership responsibility takes you closer to the best point; it brings out the hidden best in you. You may initially be of the view that your person lacks the ability to handle a certain leadership position, but the moment you occupy it, you would inadvertently find yourself exercising the required capability.

A leadership post serves as a motivational tool. It propels the occupant to possess the zeal to do more. It triggers that innermost motivation in you that wouldn’t have ordinarily being displayed if you never occupied the position. It reinvigorates the passion that might had left you in the past. The passion and vigour to triumph will invariably knock at your door, thereby awakening the candid quest to work extra mile towards actualizing a conceived goal. The intent to do more would keep flying in your mindset.

It attracts innovation. As the incumbent occupant of the position, there’s a natural tendency that would make you yearn for innovative ideas. You would want to do better than your predecessor; you would wish people see you as the best thus far since inception of the position whenever you eventually left. Every genuine leader is desired to leave a legacy as s/he takes a bow after tenure expiration. In other words, he wants to be reckoned as second to none, not second best.

It keeps you informed at all times. As a leader, you would always be ahead of others as regards information receipt. A leadership position gives you that desire to acquire firsthand news concerning your jurisdiction, hence would detest to receive it as stale. Of course, “information is power”, because it gives you the needed tool for adequate preparation toward averting inconsequential excuses. A leader is in a good position, and has all it takes, to be aptly informed.

Away from the fascinating intrigues of a leadership position, there are some other uncalled feelings that might preoccupy your mind, hence making you stay off the track unwittingly as the journey progresses. The position intoxicates, regardless of its status. There’s a sense of intoxication one feels while occupying a post of authority; he feels drunk on some occasions, especially when taking decision on critical issues or while addressing his subordinates. By so doing, he would mistakenly step on the toes of his superiors, or the king makers, as the case may be.

It only takes His grace for leaders to retrace their steps whenever they’re intoxicated. This is the reason a leader who does not recognize his creator, usually fumbles in the long run, thereby finds himself crumbling without pulsation. One thing you must acknowledge as a leader is that, you can never successfully do it alone without a mentor, guardian, and/or counsellor, or what have you; this is a fact you mustn’t take for granted. Leadership must be a teamwork if truly you intend to excel.

Another bitter side of leadership positions is sycophancy. I’ve in the past done a very extensive work on this; as an analyst, I took time to dissect the intricacies of the monster called sycophancy. Believe it or not, any form of leadership is synonymous with sycophancy, and the latter kills any leader who isn’t careful enough faster than poison would. It’s a tool that swiftly devours a leader, even when he is decorated with an uncommon armour.

In his words, Silver Mars opined “A friend who agrees with everything that you say and do, is worse than the foe. Beware the sycophant!” Being human, particularly a leader, you would desire to see everyone dancing to all your tunes, forgetting that anyone could err. Everybody desires to witness people’s acceptance over their opinions or decisions, let alone a leader.

While in the position, people would invariably troop in to tell you ‘sweet’ things. Your ‘friends’ will tell you how good and cleverly you are doing, but would never find time to admonish a few of your policies even when their negative implications are so glaring. You would laugh and wine with them and crack jokes together, not knowing they are actually laughing at you while awaiting your downfall. To overcome this challenge, you must possess an independent mindset; be open to all but always endeavour to think deeply over their words before accepting, or making use of, them.

In her words, Sheryl Sanberg enthused, “Leadership is about making others better as a result of your presence and making sure that impact lasts in your absence.” It’s simply about leaving indelible footprints behind, which would speak for your personality even many years after your exit.

The bitter truth is that, a leadership position isn’t for everybody; not everyone is meant to occupy it, irrespective of paper qualifications. Though anyone can learn to be a good leader, but a true leader is unequivocally inborn. Think about it!

The Author could be reached via frednwaozor@gmail.com

X-raying The FUTO CE-sPESS Conference in Imo

Learning is indeed a lifetime process. This could be proven when most learned individuals, such as professors, are members of a gathering targeted to impact knowledge on the participants. The widely publicized 5-Day maiden International Conference on Procurement, Environmental and Social Standards (ICPES - 2024), which graciously held on 12th - 15th November, 2024 in the prestigious Federal University of Technology Owerri (FUTO) was a good example of the above assertion. The Conference whose Theme is "Key to a Sustainable Livelihood in the 21st Century", was heralded by a Opening Ceremony, which featured goodwill messages from special guests, various presentations on different topics by distinguished academics, as well as panel discussion. It's noteworthy that the Conference was gallantly hosted by the FUTO Centre of Excellence in Sustainable Procurement, Environmental and Social Standards (CE-sPESS) in conjuction with the School of Environment Sciences (SOES) of the University. In her Goodwill Message during the Opening Ceremony, the Deputy Governor of Imo State, Her Excellency, Lady Chinyere Ihuoma Ekomaru congratulated the hosts of the Conference and urged them to keep the flag flying as she officially declared the ICPES-2024 open. Lady Ekomaru - who was ably represented by the Principal Secretary to the Deputy Governor's Office, Mr. John Njoku - assured the hosting team of her support. On her part, the Chief Host and Chairman of the Occasion who happens to be the Eight Substantive Vice-Chancellor of the University, Prof. Mrs. Nnenna N. Oti commended the FUTO CE-sPESS and SOES for actualizing such a feat as she specially welcomed everyone who found time to grace the event. The VC, ably represented by the DVC on Academics, Prof. Emma C. Esenwa described the outing as the first of its kind. In his Keynote Address on the topic "Procurement, Environmental and Social Standards: Unlocking Sustainable Livelihoods in the 21st Century", the Seventh Substantive and the immediate past Vice-Chancellor of FUTO, Prof. Francis C. Eze advocated the need to fully and duly incorporate Internet of Things (IoT) and Machine Learning (ML) in the procurement processes. Prof. Eze equally emphasized the essence of making profit, but not at the expense of the host communities or any entity that's involved. Earlier on the Occasion, the Host of the ICPES-2024, Engr. Prof. Mrs. Gloria A. Chukwudebe informed the participants that she was impressed that a Conference, which was conceived barely a few months back, came into reality. Prof. Chukwudebe, who is the pioneer and incumbent Leader of the FUTO CE-sPESS, took time to present the background and journey-so-far of the Centre to the members of the gathering. Similarly, the Conference Co-Host, Prof. J. D. Njoku notified that the ICPES-2024 was borne out of the need to fully educate the members of the society, particularly the academia and industry, the practical essence of sticking to the extant rules when public procurement is being carried out. Prof. Njoku, who is the current Dean of SOES, conscientized the participants to take the participation seriously as long as the brainstorming outing lasts. In her Welcome Address at the beginning of the Ceremony, the Local Organizing Committee (LOC) Chair, Prof. Mrs. Roseline Feechi Njoku-Tony appreciated every member of the LOC for their laudable inputs during the preparatory session. Prof. Njoku-Tony stated that the planning was so rigorous, because the committee was expecting outstanding results. The Guest Speakers who made presentations at the event were: Prof. Chidi Nzeadibe of the University of Nigeria, Nsukka (UNN) who spoke virtually, Dr. Yakubu Aminu Dodo of the Najran University, Saudi Arabia who also presented via online, as well as the Acting Vice-Chancellor of the University of Agriculture & Environmental Sciences (UAES), Umuagwo in Imo State, Prof. Christopher C. Eze. The Panel Discussion featured the representatives of the key stakeholders in the SPESSE Project. They were: Dr. Joshua Atah of the NUC (represented by Ms Lulu Airudulu); Mr. Adebowale Adedokun of the Bureau for Public Procurement (BPP), Abuja; Mrs. R. A. Odetoro of the Federal Ministry of Environment, Abuja, as well as Mr. Benjamin Okwesa of the Federal Ministry of Women Affairs, Abuja (represented by Mr. Olutimi Jacob). In his Vote of Thanks, the Steering Committee Chair, Prof. Chris Nwoko strongly thanked all stakeholders who contributed towards the success of the Conference, especially those who made out time to witness the commencement session. The 5-Day ICPES-2024, which successfully came to an end on Friday, 15th November 2024, featured various sessions, including plenary, technical, debate, exhibition, and paper presentations. The Guest Speakers during the plenary sessions from Wednesday, 13th to Friday, 15th included, but not limited to: Prof. Kenneth Amaechi of the University of Edinburgh, United Kingdom (UK); Dr. Vincent Ogu; Prof. Aka chief Odoemena of the Woodrow Wilson International Centre for Scholars, Washington DC, USA. Others were: Dr. Ama of the Bangor University, UK; Dr. Muhammad Ahaker Ali; and Prof. Ernest Uwazie of the Clifornia State University, USA. Some of the participants who aired their views after the Conference expressed delight over the outing, and pleaded with the Management to ensure such an intellectual harvest is organized on a regularly basis.