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Published On: Fri, Apr 24th, 2020

Coronavirus: Saving Nigeria from the peril of oil economy

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By Ahmed Salami

It is no gainsaying the fact that the global pandemic Coronavirus has made the world economy to shrink. With a sudden shutdown of most countries to contain the spread of the virus, economic activities have taken a serious nose dive in many nations. The International monetary fund has said there may be a global recession after the pandemic. Back home, the crude oil which was predicated on $57 per barrel for the 2020 budget, has crashed to below $30 per barrel. The Central Bank of Nigeria has said the country may slip into recession again after this pandemic is over.
As it stands, Nigeria is still looking for funds to implement the 2020 budget. The Federal Government already said there will be adjustments to the budget in view of the reality on ground. Presently, government is looking for funds as palliatives for Nigerians over the shutdown of economic activities since COVID-19 crisis started.
Recently, the Minister of Finance said Nigeria was seeking fresh $1.5bn from the World Bank and another $1bn from the Africa Development Bank to address her economic challenges. The truth is that Nigeria is broke and government cannot meet her obligations without borrowing, oil has crashed and now is the time to look critically into other ways of revenue for the country. The situation of the country now requires shrewd and apt economic policies to be put in place to overcome the daunting economic challenge ahead.
Diversifying Nigeria’s economy has been a matter different governments have been chewing since the advent of democracy in 1999. Despite deafening complaints about the need for government to diversify its economy, the cheap, stress-free and unaccountable oil money has remained the main source of Nigeria’s revenue.
Nigeria’s slip into recession recently in which more than 30 states were unable to pay salaries of workers has not really taught our leaders any lesson. While other oil producing nations have moved from oil based economy to diversifying into ICT, agro-tech, manufacturing and others, Nigeria is yet to explore other ways of generating income.
The current economic situation portends danger to all of us and generations yet unborn and time has come for us to forget about emotions, self-conceitions and embrace reality.
If truly the managers of Nigeria’s economy wish to change the narrative, leaders must operate with conscience, patriotic and open mind. The reality under this circumstance is to diversify and create alternative to oil. A situation whereby a barrel of oil now sells for below $30 against the $57 projection at the international market is terrifying and something urgent has to be done, else we are doomed as a nation.
Available statistics revealed that the country has over 100 non-oil money spinning agencies and parastatals on which the economy can rest and rotate without oil. But the big question is, have they been fully tapped to help halt the economy which is sliding towards another recession rapidly.
A research carried out by experts on non-oil sector said the Nigerian Customs Service, solid mineral sector, agriculture, education can service the country if optimally tapped with no revenue from oil added. The research corroborated the fact that the Customs Service alone can make the economy of the country flourish if government forgets about political patronage and allow core professionals to drive the sector.
Stakeholders have consistently said the major hindrance why the NCS can’t generate enough for the country is due to common problem of governance in Nigeria – putting square pegs in round holes. The Nigeria Custom Service needs to be manned by a trained NCS officer. The present arrangement of deploying a retired army officer to be in charge is on the long run counter-productive.
Apart from the fact that appointing a retired army officer to head Customs is against the NCS laws, the orientation of an army officer is totally different from that of a Custom officer. An army officer is trained to combat, protect aggressively and defend national integrity, a Custom officer is simply trained to generate revenue. These are two different things. Defending national integrity and revenue generation are not the same. So, if the handlers of the nation’s economy want to generate maximally from NCS, it is time to put trained personnel in the saddle.
The arguments of corruption and partiality have always been advance as the reason why a non-Custom officer is posted to man the service. Unfortunately, those canvassing this point have forgotten that corruption is not innate to anyone or group, any human being can be corrupt. And even the military is not excluded from heavy corruption allegations which has been in the media for some time.
In a recent interview, a former Custom officer and presently a senator, Francis Fadahunsi, raised the alarm over the decadence and rot in the service. Fadahunsi, who is the Vice Chairman of Senate Committee on Customs and Exercise, said the NCS had been deeply immersed in political patronage rather than concentrating on its economic value to the nation.
Corruption, according to the lawmaker, is a major setback for the country which affects every aspect of our economic life. Fadahunsi lamented that the Senate Committee on Public Accounts recently discovered a mind-boggling trend in the federal civil service that over 232 parastatals and agencies have refused to declare their accounts in the last five years, which he said substantiated the humongous corruption being perpetrated at that high echelon of government, thereby sabotaging the economic dividends and conscripting the country to the labyrinth of monolithically oil dependent economy.
Fadahunsi believes if things were done right, the NCS is capable of yielding enough revenue for the country.
“I worked as a Customs officer for over 30 years before I retired as an Assistant Comptroller General and I know that the money from that sector can support Nigeria and make it a developed nation without the need to borrow a kobo to run the economy.
“But the rot in that sector started by appointing a soldier, who knew nothing about how to generate money to be Comptroller General of Customs. Though, there are over 232 agencies and parastatals that make money for government, the Customs has to take the lead.
“Now that the reality has dawned on us, let there be reorganisation in Customs. Let the present government bring in a core professional to man Customs. Let all our prohibited commodities be given to all member nations of ECOWAS to stop smuggling.
“They said they have closed the border, are we getting the gains? As I speak, the smugglers are still bringing in contrabands into Nigeria through alternative roads and Nigeria is losing. But if Customs is reorganised and all the commodities are made to come through the ports or land borders and Customs are allowed to collect the duties, Nigeria will make several billions of dollars monthly, far more than what they oil can do,” he said.
In the same vein, a former Deputy Comptroller General of Nigeria Customs Service, Mr Afolayan Jejeloye, added that the country could have had one of the best Customs service globally but for alleged politicisation of the activities of the institution.
Jejeloye advised government to embark on serious reorganisation in NCS to be able to rise to the challenge of raking in enough revenues that make up for the shortfall in oil revenues due to Coronavirus.
“The FG must spend more on the training of personnel. They must be made to acquire the right training in the areas of anti-smuggling techniques, revenue generation drives, border protection, import and export management and many others.
“We know there is corruption in the system and Customs can’t be an exemption, but NCS operatives are not the one doing smuggling or bribing people to compromise at borders.
“If you secure employment into NCS, you are not sure that you will get career progression. You don’t know when your employment will be terminated and this accounted for the corruption in the system.
“Let me say this, today in NCS, most of our men at the borders are not given transport or any other allowance and if they see someone who can give little stipend, they will gladly dive and grab it.
“I have never seen a situation whereby someone was brought from outside to be Inspector General of Police or Chief of Army Staff or Comptroller General of the Prison, but this happens constantly in the NCS and it is destroying the system.
“The sudden slide of our economy into recession is a lesson to all of us. It taught us that we must be prepared all the times in proper planning for steady economic growth and putting up proper strategies to solve any sudden economic challenges like Coronavirus.
“We must learn how to maximise profits in every opportunity available to us. If we have diversified to develop, the Coronavirus issue can’t be a serious Issue.
“NCS is a source of income generation in our nation and we have to make judicious and maximum use of it through personnel restructuring that is putting the right persons in right positions.”
Another retired Customs top brass, Mr Baritor Kpagi, advised that the best way to reposition the NCS is by allowing career officers and experienced professionals to lead the agency for better efficiency.
Kpagi, a retired Assistant Comptroller General, posited that the NCS is a highly technical institution that can’t be led by inexperienced person if truly the country is desirous of savouring the huge gains inherent in better operation of the service.
“For you to drive revenue at the borders or ports, people must pay tax. A situation whereby people are being terrorised or harassed to pay tax is no longer fashionable. Tax all over the world is what you do through conviction and persuasion.
“Customs is a technical work and a situation whereby you brought someone of military background to lead such a technically-demanding agency, what do you expect to happen?
“The erroneous impression they had was that the military men are not corrupt but only the Customs officers are corrupt. What do you think will happen when you pursue an agency in this manner?
“Even those who are professionals don’t know all the technicalities involved in Customs, let alone someone without the right background.
“Despite spending my entire career in the Customs, I don’t know the full concept of Tariff Classification, I was just learning the concept when I bowed out of office.
“All over the world, Customs is no longer a mere revenue generation body, it is now more of trade facilitation, which was designed by World’s Customs Organisation in Brussels, Belgium.
“When you facilitate trades, it would be easier for the government to make more money to run the country than rely only on import and export duties paid into the coffers.
“So, if someone spent the entire career in Customs and could not understand all the technicalities involved, one would imagine what will happen when some without the necessary knowledge was brought in.
“Not until we put in the right professionals who understand all these technical concepts, we will continue to have problems,” Kpagi said.
The COVID-19 has now opened our eyes to reality, our leaders must think and see beyond the narrow prism of political and ethnic affiliations by taking the bull by the horn and do what is right and just in the overall interest of our nation.

Ahmed Salami, a political analyst and media consultant, writes from Abuja

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