The next firesale goes on, quietly
Very quietly; very, very quietly; two events happened in past fortnight (to 07 December 2004) that have significant implications for the future of Nigeria as a global power.
# NEPA was de-structured into six operating companies.
# BPE was restructured into five operations departments.
Both events were coordinated by USA Department of State, UK trade and development civil servants, IMF and World Bank officials who have been working within the Abuja, FCT offices of both NEPA and BPE for years.
NEPA is every Nigerians favorite whipping boy. The perennial complaint is there is never any consistent power supply. It has been analysed that the entire grid structure of the country will have to be replaced because the existing grid is of the wrong design. This writer thinks there should be numerous regionally decentralised grids rather than the present design of one nationally centralised super-grid. Doubtless some investors will obtain the contracts to manage the generating, distribution and service companies that will emerge from NEPA. It is less doubtful that any Nigerian companies will be appointed to these critical roles: they do not have international experience. Even if the current crop of seasoned engineers and senior management form a company, they will probably be overlooked.
It will be difficult for any country to develop large scale production capacity without reliable and AFFORDABLE electric power. Nigerians will hope that they do not share the experience of California, Venezuela, Britain, Canada, and ALL other economies that have privatised electricity. Their people now receive monthly shocks from their power bills.
The reorganisations at the Bureau of Privatisation of Enterprises is of utmost importance. The BPE holds the keys to Nigeria's future as a successful or failed country.
The BPE comes under the authority of Atiku Abubakar, the country's vice president and rumouredly, one of its richest businessmen. Nobody has ever released a corporate financial statement or private tax returns listing the great man's income, assets or directorships. There are no public financial records either for his boss, the president and millionaire farmer, Olusegun Obasanjo. Or for any of Nigeria's current or previous oligarchaic politicians and military rulers. But that is not the main issue here.
The main issue is that powers-that-be are bent on ensuring that Nigeria pushes through with transferring into assets that the Nigerian public collectively paid for over the years into control or ownership by the private sector. The batch of institutions lined up for the next firesale include NEPA, NNPC, NAA and the airports, Central Bank of Nigeria, Nigeria Stock Exchange, federal institutions of higher education, research institutes, and other core assets. Previously "failed" transfers like NITEL, Ajaokuta Steel works, NiPost and Nigeria Ports Authority will also be re-submitted. These were previously sold to "suit, suitcase, and suite" companies like Pentascope and Solgas. Those companies may well have their contracts renewed, as the akotileta government struggles to sell unfavoured assets into depressed world markets.
Nigeria may do well to ask why they consider themselves so smart when consecutive governments are getting away with sovereign murder.
Everything that is not rooted to the ground is being sold off. Even forestry rights are being sold off and farmland given away while government officials import basic foodstuff from all over the world. AT THIS RATE, NIGERIANS WILL SOON BECOME THE WORLD'S FIRST TOTALLY PREPAY ECONOMY. They will have to pay for their services twice, thrice, multiple times over, before they have any chance of using such services. Sometimes they will not get the services they paid such extortionate rates for. They will have nobody to complain to and no redress if they bother. Sounds like the GSM industry? Wait and see. The people in this country face the chilling prospect that, in a few year time, they will be taxed or charged to pay for national debts that are not secured by any national assets or national revenues.
If unchecked, the mugging going on may result in the entire country in slavery-plantation conditions. Current international market conditions are not appropriate for any country to be undertaking privatisations. Nigeria's assets are internationally denominated in USA dollars. That currency is in free fall in world markets. Yet its value is rising against the Naira in local markets. Why? Nigeria has to import everything and its trade is denominated in USD. So importers must buy USD no matter what.
Businesses are no better run or less corrupt just because they are operated by the private sector. Witness the meltdown of Enron (USA), Arthur Anderson (UK/USA), savings and loans industry (USA), railway privatisation (UK), pension funds (UK), Fannie Mae (USA), Common Agricultural Policy (EU) and other multi-billion private-sector frauds.
Even the average person knows that a time of penury is not the best time to seek a bank loan or negotiate a decent deal from a pawnbroker. The privatisation madness and economic liberalisation crassness should stop, if only to give Nigerians a chance to run their own affairs. The current management of many public companies slated for privatisation will do a decent job if the government gives them a management contract and then pays its way like any other consumer. History indicates that privatised ownership or control of Nigerian people's assets results in disdain and abuse of the people's interests. Already the beneficiaries of Nigerian Airways giveaway are saying that no Nigerian should expect a high level appointment in the Virgin Airways (UK).
Presumably, the president and senior government officials of Nigeria will shamelessly sit in first class while their people in coach class are "flitted" with deodorants and pesticides like dirty coachroaches on flights leaving the country.
The advocates of these mugging activities are dangerous to our national wealth. They would be roundly denounced in any sensible society and they would be forced to leave positons of such responsibility. But the intellectuals of this country are slavering over scraps just so they can feel priviledged.
Paradoxically, the privations may be the making ot the Nigerian people. The continued spate of privatisations will almost certainly remove the last vestiges of common interests from the populace. At last, the colonial-era construct may render and free its progressive elements to pursue alternative political arrangements. This need not be a BAD thing. Witness Somalia, so lawless since 1991 to date. It has the most connected telecommunications and air transport market in Africa, entirely because the lawlessness prevented akotileta governments from attaining national power. Somalia has the cheapest national and international calling rates in Africa. It takes three days to connect a landline telephone. Every warlord had to look after his people. So he allowed enterprises to thrive in this fiefdom and taxed them. The national airports destroyed? Warlords built private airstrips and jetties using Somalian engineers. Now that the country has a "president", nobody dares use foreign engineers to build roads, bridges, buildings, and other basic civil infrastructure. How unlike our Julius Berger capital!
Somalia has learnt the lessons of national strategic interests the hard way. If Somalia had oil, their engineers will dominate the oil sector. If they fix their airline, would you bet against Somalian pilots, crew and check-in staff? You CAN bet that no jumped-up foreigner will dare "flit" a flight to or from Somalia!
Links:
http://p221.ezboard.com/fnigeriadiscussionsfrm2.showMessage?topicID=791.topic
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Remi-Niyi Alaran writes on enterprise and social capital.
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