On Monday, September 19, 2022, His Excellency, Dr. Peter Obi, the presidential candidate of the Labour Party, LP, was a guest of the Lagos Chamber of Commerce and Industry, LCCI.

As was done penultimate week by His Excellency, Atiku Abubakar, Vice President of Nigeria (1999-2007) and presidential flag bearer of the People’s Democratic Party, PDP, Dr. Obi was there to present his economic blueprint. And as has become his trademark, he chose to speak extempore, fielding questions from industry operators and executives.

He did not just present a blueprint, he spoke on some of the most crucial challenges confronting Nigeria, while presenting what he considers the best pathway to a productive economy. Chanting his mantra of ‘turning Nigeria from consumption to production’, Obi regaled his audience with figures and examples from other climes to pooh-pooh the present construct of Nigeria’s economic management.

Excerpts:

Our situation

I’m a trader by profession and I’m one of you; and being one of you, I share and understand your pains. As you know, the government that’ll come in in 2023 will be confronted by an array of daunting challenges – both domestic and external.

The domestic ones that accumulated over years and because of leadership pressure, has not been dealt with and these have impacted heavily on our unity, social cohesion and peoples trust in government, as well as economic outcomes that have affected us negatively. Where our country is, today is always about bad news.

We now have the highest concentration of people living in poverty, the highest number of out-of-school children, a high infant mortality rate, which is the highest in the world, high rate of youth unemployment. Coupled with all these, at this time, we are faced with an international challenge – coming out of COVID-19, which created a lot of challenges to global commerce, and supply chain issues; again, affecting even long-term global plans of climate change and issues of SDG. Nigeria has to deal with all these issues but as you know, Nigeria is not bereft of good ideas and plans.

Most of those ideas have even been preferred by the Lagos Chamber of Commerce and Industry, LCCI, but institutional weaknesses and lack of political will to implement them has over the years affected the people.

Critical areas of concern

Seven critical areas that will ensure purposeful leadership, production-centred growth for food security and growth. Securing Nigeria, effective legal and institutional reforms, rule of law, corruption and government effectiveness, leap-frogging Nigeria from oil dependency to fourth industrial revolution; expanding physical infrastructure through market-driven reforms for lifting growth and encouraging entrepreneurship, creating innovations, human capital development for competitiveness, promoting a foreign policy to ensure Nigeria’s relevance. These are things that are critical that we want to do. Our goal is to bring back the trust of people in governance.

Revenue challenge – FG’s revenue, foreign reserves, debt issue, FDI

On the issue of liquidity, my question is always ‘how do governments of other nations get their own liquidity?’ Because they, too, are going through the same problem we are going through. Yes, we have a revenue crisis but it’s like going to the bank, you have to pay interest. You cannot go to withdraw money without you having paid in.

How do governments pay in? It is the job of governments to ensure there’s an investment in economic growth and create employment, which will allow people to pay taxes. You cannot have 100million people living in poverty and you’re expecting robust revenue.

If you use the global standard of 50 per cent to 60 per cent, with our population of 200 million, you expect that about 100 million to 120 million Nigerians should be working.

But the reality is that just about 40 million people are gainfully employed. So, about 50 million to 70 million people are unproductive, they are not doing anything for you. So, you need to start pulling those people out of poverty, have a robust economic plan and you’ll be able to have the liquidity the government needs to function. How does government generate money everywhere? Let’s use China, where its last budget which I followed was about $4trillion. Out of this, $3.2trillion came from taxes, 50 per cent of that came from micro and small businesses and 60 per cent of the employment in China is by this group – the employment figure in China is about 800million and this group is providing about 540million. Again, countries borrow money to invest and you’ll have growth, which in turn brings in more revenue.

Security

If we come to government in 2023, one thing that we must decisively and aggressively deal with is the issue of security. Insecurity is the number one thing that is impacting Nigeria’s economic growth today. And we’ll need to deal with it as quickly as possible. We’ll need to overhaul the entire security architecture, including having multilevel policing involving the federal, state and community, and equip them properly with modern gadgets. Nobody will be able to kidnap, keep his victim somewhere and use the phone to negotiate ransom with his victim’s family without being caught.

In Anambra State, no community did not have a community security system, paid by the Office of The Governor and we provided every community with a pickup vehicle with gadgets. I’m not saying Police and Army, which we did but every community and I can assure you, we will do exactly that because at the heart of whatever we are going through today is security and it must be dealt with.

Power

This is a critical thing that has to be dealt with decisively. The FG has removed power from the Exclusive list to the Concurrent list. We will go further. We have privatised generation and distribution, leaving the critical link between this two, which is the transmission. That is where we have what we can call an ineffective problem that needs to be dealt with and for us, what we will do is to liberalise transmission.

When you do that, you’ll look at the power companies and we can support the existing companies to ensure that there is a dedicated gas supply, ensure that generation, transmission and distribution are properly aligned and have certainty of policy and an environment that creates certainty for them to operate. The issue of power will have to be an emergency that we will have to deal with by all means possible to ensure that we have power. To have the resources to do this, we will involve the private sector.

The government does not need to be entirely involved. We have to deal with the issue of embedded power and renewable energy. We have to go with all that is available. Access to funds can be dealt with by involving the private sector aggressively. Where the government is going to be involved is, like what happened in Egypt, is that government will provide sovereign guarantees to investors.

How to handle the system and institutional stability

When people get into government and say something changed, it is not true. People get into power and bring out their true character. If you’re determined, you’ll do what is right. You can hold me responsible for the actions of our government because we do not have the time to waste and we plan to put together the best and capable set of people, youths, with energy and determination.

It is easy to sit with experts and draft something as a position paper but I opted to speak for myself and I’ve said let the candidates come and speak about what they want to do and not some spokes persons doing the talking. We do not want a situation where somebody will get into Aso Rock and start complaining about what he saw. We want to hire the chief executive of Nigeria and that person must come for the interview personally, he must present himself to Nigerians. So, about institutional instability, the government I will be in charge will not be supply-driven, it will be demand-driven. I’m going to return to this LCCI to know what you want; it’s about the people.

In Anambra, I gave my phone number to the prefects of secondary schools and they demanded to have computers in their schools and I supplied them – that is governance. It is not about me. We will change government from being public sector-led to becoming private sector-led so we will consult the private sector, we will listen to them. We’ll come out with deliverables that are measurable and the new driver of the Nigerian car must be competent and must be clear about where we are going and not begin to give excuses.

That derives from the certainty of policy, security of lives and property, rule of law and order and I will lead. I will subject myself to Nigerians.

The issue of waste is at the core of the problem we are facing today. We are going to streamline governance to be responsive, trans-motive and effective. There are plans already there. We are not coming as one super entity; the ideas are already there. What we will do is to ensure that they are implemented. What is lacking is the political will to deal with the issues that are affecting people. The political will to follow the rule of law, the political will to have certainty about the operating environment that will attract investment, the political will to deal with the issue of oil theft, for instance. Who is stealing our oil? They know. Nobody here can steal oil. For you to steal oil, a ship has to come here and load it and leave. The same goes for corruption. The reason why we are not doing well in the corruption index is because of the same thing. The ability to do the right thing is what I’m offering.

Crude theft, subsidy, exchange rate, waivers and debt

Under my watch, there’s no way we will allow crude theft. We are the only country in the world that is not meeting our OPEC production, except Venezuela, because of sanctions. In July, our production was 1,083,000, which means in July, we had 717,000 barrels shortage. Just multiply that by 31days, that gives 22,227,000 barrels on the average pricing of $110 per barrel, so, we lost $2,445,000,000 (two billion, four hundred and forty five million dollars) in one month. Even at the officialN410 to $1, (meanwhile, the real rate is N690). Let’s use a N550 to $1 average, and you multiply $2,445,000,000 by N550, you’ll have N1, 344,750,000,000, and we are owing ASUU, N1.1trillion. That’s just one month’s crude theft. In the month of August, it became worse.

In August, our supply went down to 975,000 barrels, so in August we were losing 825,000 in a day. Multiply by 31days of August, it will give you 25,652,500 barrels and throughout the month of August, it sold for $100 per barrel. So, we lost another $2.5billion. Multiply again by N550, it is about N1.4trillion.

That is official stealing and we will deal with it decisively. We are borrowing money and some people are there carting away money.

During our time, all duty waivers must be designed to and we’ll ensure that it will have a direct positive impact on the people and not for anybody’s benefit. You must pay the duty and if you’re not going to pay it, it must be as a result of you bringing something for the benefit of the people, say health equipment, not in the presidential clinic but the general clinic.

The problem of exchange rate today in our system is that of fiscal recklessness and we can deal with it. If you stop printing money for subsidies and stop borrowing for consumption, you’ll stabilise the rate. How can Nigeria with 923,000 sq km of land, 200million people, total export last year is $47b, it is not acceptable? Vietnam, has 331,000 sq km, 100m people, and their export is nearly $400b.

They exported manufactured goods, so what are we doing here? Malaysia, living on 329,000sq km of land, 30m people, total export is $290b and we are doing $47b. Israel, 22,000 sq km, nine million people, their export $69.8b. Deal with issues of fiscal recklessness, your exchange rate will stabilise.

The subsidy is organised crime. Fifty per cent of the subsidy is corruption and we will deal with that decisively. Then, aggressively, we’ll start immediately, local refining through all forms available and they’ll be private sector delivered. We are an oil-producing country. Supply the refineries with crude in naira and we have to stop the dollarisation of our economy. Once you remove subsidies, inflation will be dealt with and deficit spending will be reduced. If you deal with insecurity today and your farmers go back to the farms, and food prices come down, you remove subsidies and deal with corruption, your inflation will come down.

Every country borrows. We cite America, Britain as borrowing and they owe more than 80percent of their GDP. China owes over 50percent of GDP. Singapore, Norway are also owing. If you borrow for consumption, you’ll have a problem. If you borrow for production, your economy will grow. Ours is for consumption and that’s why we even have problems servicing the debt.

First 100days

We are going to have an Assets Registry so we know the assets of the country and ensure that they are all put into production because we want to move from consumption to production and all assets must be productive and to make it productive, we are going to remove it from government to private sector. I’m not talking about transactional private sector delivery but scheduled private-sector driven. I do not need to tell you what will happen in the area of cost of governance; you only need to go and verify what I did in Anambra in that area.

The same thing will apply in Nigeria. There are quite a number of things that are not supposed to be on the Exclusive List and that we can deal with as quickly as possible – agriculture, education – the Federal Government is not supposed to be involved in those and quite a number of them. They are not things that I can tell you here but we are going to deal with that issue as quickly as possible.