Politicizing economic policies is dangerous

I am sure that politicians are aware that the world is moving ahead and no nation will wait for Nigeria in its quest for development. But I am not too sure if politicians really know the distinguishing line between economics and politics. In Nigeria, issues of national development are often mixed with politics such that technocrats in government cannot deliver. In 2008, when the global economy was suffocating with central banks administering emergency measures, politicians told Nigerians that the nation’s economy was buoyant. Eight years after, the nation is experiencing misery; misery occasioned by poverty.

In Nigeria’s political kingdom, outrageous promises are made and when not fulfilled, politicians will most times tell those who voted them into office that they should bear with them. If it is failure of policy, politicians will say they are trying. They may even say there is “no alternative” to the failed policy. For most Nigerian politicians, electoral promises are more important because they want to remain in office perpetually.

Unfortunately, most politicians do not keep to promise. Some of the politicians who make promises do not understand them within the context of national development. When questions are asked regarding promises made, politicians adopt a hostile posture. This is because most times politicians do not have any clue towards solving critical national problems. Politicians who have clue fail because of arrogance and greed.

Economists know that economics is about people. That is why Adam Smith, the father of economics, refer to economics as “genuine social science”. Economists will always ponder and reflect on principles governing questions such as what should be produced, when and where, how and for whom, at what cost, and at what efficiency, to ensure that the difference between the cost of supply and the price demanded will yield profit. You may want to know why many Nigerians including my humble self are skeptical about economics in Nigeria when applied to our daily lives and livelihoods. It is because at the theoretical level it is full of implausible idealizations. While in practical terms, the dominating factor is greed.

In 2015, one of the commentators in this paper said in an article that once you remove politics from anything in Nigeria, you will get result. I concur with this view. I am sure that the PMB administration has now come to terms with realities of governance in Nigeria. But PMB has much grounds to cover in terms of Nigeria’s economy. I am still concerned about the state of Nigeria’s economy. The concern increased exponentially on 21 March 2016, when the President said that his administration will ensure steady power supply before the expiration of his tenure by producing an additional 10,000MW of electricity by 2019. This assurance was given at the recently concluded National Economic Council Retreat. An excellent political promise! But how will this be achieved when there are teething problems in the sector.

Mr President has not forgotten that the power sector is privatized with many turnkey projects in transmission and power generation not completed. What is the amount of money budgeted for power projects in the 2016 budget? From 2018, when politicking would be at its peak, electricity supply output will rise on paper. Different figures will fly around in the public domain, to enable politicians win the hearts and minds of voters. It is the federal government that is promising Nigerians increase in electricity supply. Private investors in the power sector are not promising anything because they are not politicians. They are only interested in increasing tariffs without supply of electricity.

I do not know how long this nation of about 180 million people will continue to live on hope and roast away in darkness. I have stated severally in this column that “hope is not a strategy” on matters of national development. The President has made a policy statement. It is for Babatunde Raji Fashola, SAN, minister of works, power and housing, to articulate his strategy by clearly stating the means and ways of achieving the objective of supplying 10,000 MW of electricity by 2019.

Late last year, Ibe Kachikwu, minister of state for petroleum, told Nigerians that all the four obsolete refineries will be made to work. That is not the story anymore. It is now 100 percent fuel importation. We also hear that gas pipelines have been vandalized. Then NNPC will be unbundled. When labor unions, PENGASSAN and NUPENG, cried foul, Ibe Kachikwu changed his last policy statement. He said Nigerians misunderstood him, that he meant NNPC will be restructured. Mr President, can you imagine this!

Regarding pipeline vandalism, don’t we know the pipeline vandals? What are those charged with the responsibility of protecting the gas pipelines doing? As for the Discos and Gencos they have decreed that unless they have a cost-reflective tariff, they cannot provide electricity at a profitable rate to consumers. If the tariff is increased, I bet there will be epileptic power supply. Every day, most households and firms run generators such that the already heated environment is polluted with smoke and noise. To make matters worse, I read that a few teaching hospitals have started operating patients with lamps and torchlight. The University of Ilorin Teaching Hospital is a classic example. What a pity!

The epileptic power supply in the country has made so many companies to relocate to South Africa and Ghana. This is due to poor business climate occasioned by poor extant laws and weak infrastructure. Incessant power failure resulting in high cost of production has made many companies to divest. Available record shows that incessant power failure has increased the cost of doing business in Nigeria by 16 percent. The high exchange rate of the Naira is equally another problem. It is very stressful conducting business in the country called Nigeria as   incessant power failure has disabled productivity.

We have lost the competitive edge to our immediate neighbors in the West African sub-region. This is because these countries have better business climates and legal structures. Consequently, firms such as Dunlop and Michelin are said to have relocated to Ghana. Yet, the government needs tax from firms in the Organized Private Sector to enable it implement the 2016 budget. What a contradiction!

It is being rumored that Cadbury, Guinness Nigeria Plc, and Peterson and Zochonis (PZ) are likely to relocate to Ghana. Some of these companies and others have retrenched most of their staff due to decaying infrastructure and ravaging economic recession. I would have suggested that state governments should generate their power supply. It is permissible by law, but most states are financially incapacitated because of low crude oil price in the international market. This is not the solution as most states cannot even pay monthly salaries of workers.

While government is busy making political statements about power supply, there is rising misery in the land. Official figures from the National Bureau of Statistics reveal that the country’s inflation which was 9.6 percent in January is now at 11.4 percent in February 2016. As a result of inflation, there is price upsurge of essential commodities. The situation is so painful because the price of food items, “pure water” sachets, school fees, and transportation have increased. You may say the federal government is trying. No problem, but the federal government should not play politics with the nation’s economy. Politics must give way to economics if the nation must develop. In implementing the 2016 budget, government should remove politics from any policy that will improve the nation’s economic prosperity.

MA Johnson