Tag: Dr. Dakuku Peterside

  • Governors, federalism and constitutional tension, by Dakuku Peterside

    Governors, federalism and constitutional tension, by Dakuku Peterside

    Tensions between Nigeria’s central and state governments have long been the fault lines of its federal system; it is like a simmering struggle between authority and autonomy. The 1999 Constitution, though intended as a compass for governance, is riddled with ambiguities—grey areas that have, time and again, become battlegrounds for political and legal duels. Among the most contentious debates is the reach of Section 305(1), which grants the president the power to declare a state of emergency. But does this mandate extend to the unilateral removal of democratically elected state officials?

    For years, this question has lingered like an unspoken riddle in the corridors of power, whispered in legal chambers and political gatherings alike. Now, it erupts into the open, thrust into the unforgiving glare of the Supreme Court by seven opposition governors of the Peoples Democratic Party, PDP. Their challenge is more than a legal contest; it is a reckoning—one that may redraw the contours of Nigeria’s federalism, recalibrate executive authority, and probe the very essence of democracy in the nation.

    The Supreme Court, under Section 232(1) of the 1999 Constitution, has original jurisdiction in disputes between the Federal Government and state governments. This means it can directly adjudicate conflicts concerning constitutional interpretation. The ongoing case will test the limits of this jurisdiction, mainly whether the Supreme Court can provide clarification in the absence of a specific dispute between a state and the Federal Government.

    If the Court rules that interpretation alone is insufficient to activate its jurisdiction, it could set a precedent discouraging proactive legal resolutions, potentially allowing constitutional ambiguities to persist until conflicts escalate. However, if the Court determines that a general ambiguity affecting multiple states warrants judicial intervention, it will pave the way for a more dynamic constitutional review process that ensures legal clarity before crises arise.

    Section 305 of the Constitution grants the president the power to declare a state of emergency, but the criteria remain broad and open to interpretation. Key questions include: What constitutes a “clear and present danger” to justify an emergency declaration? Should there be legislative oversight beyond the National Assembly’s approval? How does Nigeria’s standard compare to international best practices? The governors argue that the Supreme Court should establish precise conditions under which emergency powers can be invoked. The governors want the Supreme Court to define what circumstances justify a state of emergency.

    A critical aspect of this case is whether the president’s emergency powers extend to suspending or removing elected state officials. The governors contend that the Constitution does not grant such authority. Their argument is grounded in Section 1(2), which establishes Nigeria as a democracy where sovereignty belongs to the people; Section 5(2), which limits executive powers by constitutional provisions; and Section 305, which does not explicitly provide for the removal of elected officials.

    The Supreme Court’s ruling will set a precedent for the extent of presidential authority during emergencies. It will either reaffirm state autonomy or expand federal executive powers, shaping the balance of power in Nigerian governance. Many legal scholars have argued that the power to remove a democratically elected governor lies with the electorate and, in extreme cases, the legislature—not the president.

    The Constitution mandates a two-thirds majority vote in each chamber of the National Assembly to approve a state of emergency. The governors question whether the voice vote method used in recent emergency approvals met this requirement. The Court’s decision will determine whether procedural irregularities can invalidate emergency rule declarations. If the Supreme Court rules that a voice vote is insufficient, it could impose stricter legislative oversight on emergency declarations, ensuring greater accountability and preventing unilateral executive actions from circumventing constitutional processes.

    Regardless of the outcome, this case highlights the importance of legal challenges in refining Nigeria’s constitutional framework. Nigeria’s judiciary is responsible for addressing constitutional ambiguities to prevent future conflicts. The Supreme Court had a previous opportunity to clarify constitutional provisions regarding local government elections in Rivers State and more specifically the place of the Electoral Act 2022.

    However, the ruling did not address critical ambiguities, leaving unresolved questions in electoral jurisprudence. The current case presents another chance for the Court to provide much-needed legal clarity. The judiciary plays a crucial role in resolving ambiguities that could otherwise lead to executive overreach or political instability.

    If the Court delivers a well-reasoned judgement, it could serve as a touchstone for future constitutional conflicts, reinforcing the judiciary’s role in shaping Nigeria’s democratic evolution.

    This case will establish whether the president’s emergency powers include suspending elected officials. A ruling in favour of the governors could reinforce state autonomy while limiting federal intervention in state affairs. Conversely, a ruling in favour of the president could expand executive powers, setting a precedent for future emergency rule declarations.

    This case could prompt the National Assembly to  carry out constitutional amendment to review the discretionary powers granted to the president. Potential reforms could include defining emergency conditions more precisely, requiring judicial review of emergency declarations, and strengthening legislative oversight to prevent executive overreach.

    The Supreme Court’s decision will be a defining moment for Nigeria’s constitutional democracy. If it upholds the governors’ argument, it will set a strong precedent affirming the independence of state governments, ensuring that executive powers remain within constitutional limits. If it rules in favour of expansive presidential authority, it risks tilting the balance of power.

    Whatever the outcome, this case has forced a crucial legal reckoning, compelling Nigeria to confront the ambiguities in its constitutional framework. The judiciary must rise above partisanship, deliver a judgment that reinforces the rule of law, and safeguard Nigeria’s democratic evolution. A well-reasoned ruling will not only settle the immediate dispute but will shape the nation’s legal and political trajectory for generations to come.

  • NIGERIA@63: RESOLVING DIVERSITY ISSUES

    NIGERIA@63: RESOLVING DIVERSITY ISSUES

    The Economist Intelligence Unit 2009 ranked Nigeria in the world’s top five most diverse countries. It simultaneously ranked the country as the 45th of 47 countries sustaining national diversity. Diversity management and inclusiveness are essential and contentious issues in Nigeria today as it was in 1960. As acknowledged by President Tinubu in a recent foreign trip, our diversity ought to be an asset for nation-building and development. Promoting diversity and inclusion is crucial for social cohesion, economic development, and the nation’s well-being.

    This great country is an intricate assemblage of cultures, faiths, and languages. With a populace that surpasses 220 million, Nigeria prides itself on an impressiveness of over 250 ethnic groups, with over 500 languages lending voice to its diverse populace. Managing and celebrating this diversity is essential for national unity.
    Our incredible diversity is a double-edged sword; it made us a great nation, a melting pot of rich diversity that, if properly harnessed, will make Nigeria one of the best countries to live and work in. Harnessing positive cultural traits brings great rewards to all. You see this in our culinary expressions, music, and arts. It is little wonder Nigeria dominates all other African countries in these aspects. Our food, music and arts are synonymous with African food, music, and art. The second side of the sword is the challenges our diversity has created in making Nigeria a cohesive and united state. People from many of the ethnic nationalities that make up Nigeria place their identity and loyalty first to their ethnic nationality before contemplating their Nigerian identity. It is little wonder some have described Nigeria as a mere geographical expression devoid of the bond of nationhood that makes a great state.

    Historically, the unholy union of many ethnic nationalities into one dominant protectorate (Northern and Southern protectorates, respectively) for administrative ease by Britain without due consultation with the nationalities or due consideration to their historical engagements created tensions that revibrate to our time. Rival and enemy ethnic nationalities were lumped together and expected to coexist peacefully without correcting the historical malice, stereotypes, and innuendos that had existed for hundreds or thousands of years before colonisation. As if this was not enough, in 1914, the British colonialists performed the unholy marriage of the Northern and Southern protectorates to create Nigeria. This marriage was clearly for administrative ease and not any well-thought-out plan for creating a nation-state.
    There was no clear evidence that the first experiment of bundling the ethnic nationalities into protectorates brought them together other than for administrative benefits. Each ethnic nationality maintained its identity and never wholly surrendered to the new identity. Scaling up forced union by the amalgamation of 1914 without giving proper attention to making ethnic nationalities bond together created a Nigeria of many ethnic nationalities that were suspicious of each other. This suspicion and sometimes outright hatred among ethnic nationalities served the British colonisers’ divide-and-rule approach well. In 1914, we had a nation-state made up of ethnic nationalities that were neither not interested in it nor suspicious of everything about it to place complete loyalty to Nigeria.
    The post-1914 Nigeria saw many activities geared towards making a ‘Nigeria’ out of the dominant ethnic nationalities. Several constitutions were made, and several state institutions were created to exert the influence of a state. There was also a uniting vision of getting Nigeria to become an independent country, a rallying ideology for all leaders of the major ethnic nationalities.

    Apart from these uniting tendencies, a chequered history of mistrust, hatred, and suspicion led to pogroms, ethnic clashes, and wanton destruction of lives and properties. The 1960 independence happened under this context of fear and distrust among the ethnic nationalities. Little wonder Nigeria’s civil war killed millions a few years after Independence.
    Since the end of the civil war in 1970, Nigeria has been battling to create a cohesive nation-state with blurred ethnic lines. The Nigerian state has tried to fight nepotism, tribalism, and lack of access to opportunities based on ethnicity. Some of the measures, although created with good intentions, created unintended problems. For instance, creating the Federal Character Principle to give access to opportunities to people from various ethnic backgrounds became counterproductive when meritocracy and value were sacrificed on the altar of equal access in Nigeria. The death of meritocracy in Nigeria due to clannishness, nepotism, and irredentist tendencies has stopped Nigeria from harnessing its best resources for socio-political and economic growth.

    Unfortunately, 63 years from Independence, we have yet to make a significant improvement in managing our diversity well, much more in harnessing it to our advantage. Today, we are still dealing with the issues of dismantling ethnic nationality loyalties and subjecting all allegiances to the Nigerian state. We are brutally confronted with diversity challenges daily in politics, social existence, communal relations, and religious differences. Any little issues of national importance are seen by many from the narrow prism of ethnicity and religion. We are a nation silently at war with ourselves based on ethnic and religious loyalties. The last national elections exemplify this. I must acknowledge that some progress has been made, but recent events show an erosion of this progress. Recent calls for secession, banditry, terrorism activities, farmer-herder crises and communal crises are a few examples of worsening tensions in the union. Prof. Anya, a distinguished Nigerian merit Laureate, has this to say, “We can no longer say with certainty that we have a nation”. Niger Delta leaders, South-Eastern leaders, Middle-Belt leaders, and Northern Elders Forum have not remained quiet.

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    The key driver of the challenge of managing our diversity is limited economic opportunities and politics of exclusion. Lack of opportunities or unequal access to opportunities exacerbates feelings of exclusion and anger, especially in a struggling economy. Poverty and greed of the elite combine to divide the nation. Poverty creates an atmosphere of shame and blame and quickly pushes people to resort to divisive ethnic and religious sentiments. And over 130 million Nigerians are multidimensionally poor. Besides, ignorance and illiteracy promote conflict and hinder inclusion. Our greedy elite are comfortable with fantastical corruption that leads to a few siphoning our common patrimony for themselves and their cronies. Any plans to manage our diversity and create inclusion must address poverty and corruption that leads to unequal or no access to opportunities.

    Therefore, we must develop more ways of celebrating our ethnic and cultural diversity. All must resist any tendency to promote cultural superiority. Promoting religious tolerance and understanding is crucial to maintaining peace. Although English is our official language, we must keep the local languages alive. We must ensure that education is accessible to all, regardless of ethnicity, religion, or socio-economic background. We must promote workplace diversity, inclusion, equal opportunities, and fair employee treatment.

    Government must be the critical driver of promoting diversity and inclusion through legislation and policies. Political leaders must aim for equitable representation of diverse groups in government and public institutions and that no one group dominates the rest in government. This has direct political consequences – political leaders must be deliberate in the equitable distribution of infrastructure, resources, political offices, and accommodation of different cultural expressions in our country. Our political leaders need to focus on building trust and creating a culture where everyone feels free to aspire to the best Nigeria can offer them. They play a critical role in managing ethnocultural divisions, gender biases, and most recently, youth bulge. They have a responsibility to create and sustain an inclusive environment for all. Our recent experience shows that the country suffers many mishaps if the political leadership does not manage our diversity and create an inclusive environment.

    Civil society organisations and non-governmental organisations (NGOs) must play a vital role in advocating for diversity and inclusiveness and monitoring and holding the government and private sector accountable for their commitments. And all stakeholders must support initiatives to promote cultural understanding, tolerance, and acceptance to bridge divides.
    Managing diversity and promoting inclusiveness in Nigeria is an ongoing and multifaceted challenge. It requires concerted efforts from the government, civil society, the private sector, and individuals to ensure that all Nigerians, regardless of their background, can participate fully in the country’s social, economic, and political life. Embracing diversity and inclusiveness is a moral imperative and a pathway to a more prosperous and harmonious Nigeria.

    Dr. Dakuku Peterside , a former member of the House of Representatives is a turnaround development expert.

  • ‘Two Global Wars and our Economic Plight’

    ‘Two Global Wars and our Economic Plight’

    There is fire on the mountain. It seems too far away, and the fire looks more like a smouldering fire than a volcano. However, the molten lava is simmering in the belly of the volcano, waiting to be unleashed. No matter what we do, although living in a faraway land, the lava shoots out like a rocket-propelled missile, and the ensuing heat will eventually reach and affect us. Should we be overwhelmed by the fear of the unknown? Or should we not work out the unknown from the known and put our house in order, as every good family head will do? Some facts are not just obvious but apparent. It would be best if you connected the dots to get the full import of the picture. We are in such a situation now. Fact number one: the world is headed for a prolonged war in the Ukraine / Russia crisis, and now the Israel/ Hamas conflict has ensued. After nearly 18 months of Russia-Ukraine gruesome warfare and its adverse impact on living standards, no one can wish for another row of any dimension. Fact number 2: the global economy will be affected if this conflict continues in its current trajectory and may get complicated if the sphere of war expands to Iran. Fact number 3: the Nigerian economy would be significantly negatively impacted if we do not take steps to hedge our economic projections and plans. The latter is the focus of our discourse for today.

    The ramifications of these conflicts are too huge to contemplate. The sensitive nature of the Israel-Palestine brouhaha touches the emotional nerves of the world, polarizing the world into two dominant frames: supporters of Israel versus supporters of Palestine. The baggage behind this support is generational and more heuristic than logical. It is tainted with elements of religious dichotomy.

    The economic interlinkages of the global community are manifesting clearly as the Russia- Ukraine war ravages the economies of nations and is now further complicated by the hostilities between Hamas and Israel. The global economy would sink deeper in three significant ways. Israel- Hamas conflict will most likely engender a spike in energy costs. It would add to inflationary pressure already escalated by COVID-19 and the Russia- Ukraine war. And it may lead to a global recession. Bloomberg economists predict global growth may drop to 1.7% and, in the worst-case scenario, may lead to another recession.

    Nigeria is already grappling with multiple economic challenges, and other developing economies are seriously and multidimensionally impacted. The discourse around mitigating the adverse negative economic impact of the two war fronts in Nigeria must be on the table. This new scenario presents another addition to issues that must be considered in navigating the complex global linkages to strengthen our economy and reduce the burden on citizens. If the crisis between Israel and Hamas expands to a regional one involving Iran, Lebanon, and Syria, crude oil prices will spike, and if not, the price rise will be marginal.

    For Nigeria, a crude oil-producing nation, this is paradoxical in two ways. First, the attendant shortfall in supply resulting from disruption in production in the Middle East may boost oil supply revenue. But we may not harness those benefits because of the Niger Delta oil production conundrum. We have yet to be able to meet our OPEC quota. Hence, only a little may be gained through an increase in supply, at least in the short run. Second, the prospect of an oil price increase seems reasonable especially if Iran is drawn into the conflict . The government of Nigeria would earn additional income from the sale of crude, and that can help shore up our currency, which is crashing like a house built on sand. However, when you juxtapose this with the fact that we import all our petroleum products and export less than our OPEC quota, whatever benefit there is vanishes to the air.
    The Guardian economists argue that the brewing energy crisis may force the Nigerian government to spend N644.8 billion subsidizing Premium Motor Spirit (PMS) monthly. They argued that with “PMS trading at $1,023.00 per metric tonne at the international market as Naira exchange above N1,020/$, crude oil price at about $100 per barrel would push the difference between the current pump price and the actual price to about N400. This difference amounts to about N644.8 billion monthly given the current consumption of about 52 million litres daily.”
    The conflict in the Middle East could lead to additional inflation in Nigeria. Shipping costs would increase because of insurance. It might cause massive disruption in global trade logistics, and when you add this to the mix of higher gas prices, inflation is the natural result. Inflation will worsen for Nigeria, which imports substantial consumer items, and most families cannot afford basic needs. Inflation will worsen poverty and the crime rate.
    While we battle inflation, the Naira might weaken because of impending slow growth projected at 1.7%. The government would be forced to intervene on two fronts, first to try to stabilize the currency by injecting non-existent foreign exchange and secondly, by reintroducing subsidies on a smaller scale to cushion the effect of a hike in the cost of petroleum products or allow for an increase in petrol price. The only saving grace might be if the Dangote refinery comes on stream and at least two of our refineries become functional.

    There is also the possibility of the FG and State government borrowing more as they struggle to implement the budget. State governments have already borrowed about N46.17bn from banks to pay salaries between January and June 2023. The FG borrowed a $800 million loan from the World Bank to cushion the adverse effects of the supposed removal of subsidy. It further followed an alleged loan of $1.95 billion from the World Bank in the first four months of this government.
    Clearly, our government and economic managers must think ahead, plan, and be more disciplined, as there are turbulent paths ahead. Policymakers must weigh the immediate economic needs against long-term sustainability and be prepared to make tough decisions. Nigeria needs to prepare itself for a potential surge in the domestic price of petroleum products with the attendant increase in the cost of transportation, cost of doing business, and hardship, especially for those at the economic periphery. Citizens may be impoverished more, and the number of multidimensional poor Nigerians will exacerbate. We cannot afford to play the ostrich while the deities in Russia, Ukraine, Israel, and Hamas play the Game of Thrones. We are at the receiving end, so we must think outside the box to navigate these unusual times.

    As a nation, we must work back our economic numbers and plan on worst-case scenarios so we are better ready rather than live in optimism and ignore global economic realities that would ultimately unfold and engulf all, hitting the least planned nations. The dual inferno has been ignited in a faraway mountain, but what we do now in our distant land will define our future. We hope that the war in the Middle East will de-escalate as soon as possible. But we must do more than hope. Nigeria’s challenge in all these remains that of forward global strategic thinking which had never been part of  our government culture . We are a reactive nation and not a proactive nation with a sense of mission . We must plan and act to protect ourselves from the potentially harsh consequences of our economy. In the medium to long term, Nigeria may need to diversify its economy, reduce its dependence on oil exports, and promote domestic production and non-oil sectors to mitigate the potential negative impacts. Additionally, fostering diplomatic relations and strengthening regional cooperation can help minimize the adverse effects of these conflicts on Nigeria’s economy.

  • Epidemic of Illicit Arms

    Epidemic of Illicit Arms

    From the small handguns of the 15th century to the sophisticated machine guns and other small and light weapons of our time, the world has suffered mayhem and wanton destruction due to the rightful and wrongful use of these weapons. In the hands of non-state actors, these weapons are used to challenge the state monopoly of coercion and in committing all levels of criminality, from kidnaping, armed robbery, banditry, and criminal revolt against the state.

    The more dangerous dimension in Nigeria is the illegal possession of military grade arsenal by criminals and non state actors. This unlimited and unchecked proliferation of illegal arms has reached the epidemic level in Nigeria in recent times with attendant national security implications .

    IMG 20231023 WA0007Neither the Executive nor the legislature or the security agencies seem to have mustered the will to tackle it. Only a few cosmetic exercises have been done. I acknowledge the little gains made by these efforts, but they have not been enough to reduce, if not eradicate, the menace of the proliferation of small and light weapons in Nigeria.

    The issue of illicit Small And Light Weapons (SALW) is a serious concern globally, and Nigeria has not been immune to its effects. Illegal small and light weapons refer to weapons that are not controlled by a state or a non-state entity and are often used in criminal activities or conflicts.

    The proliferation of such weapons in Nigeria has had devastating consequences, contributing to the perpetuation of violence, crime, and insecurity in various parts of the country.

    There have been reports of the circulation of small and light weapons in different regions of Nigeria, particularly in areas affected by conflicts, such as the Niger Delta, the North-East region plagued by Boko Haram insurgency, and other volatile areas,but no serious attempt ,by Nigerian authorities, has been made to get data about the estimated number of SALW in circulation .

    These weapons often find their way into the hands of criminal groups, insurgents, and other non-state actors, fuelling instability and posing a threat to both national and regional security.

    With access to many illegal weapons, the rogue elements have become emboldened and more aggressive, hence less amenable to entreaties to make peace and are objects of terror to all.

    IMG 20231023 WA0005The situation where these rogue elements have better and more sophisticated weapons than the security agents leave much to be desired. We expose our security men to harm’s way in their seemingly onerous task of protecting us.

    The statistics on small and light weapons aberration in Nigeria are alarming. According to Small Arms Survey, a Swiss-based non-profit, in 2020, Nigeria had an estimated 6.2m of arms in the hands of civilians, excluding those of the military and law enforcement agencies.

    This means that 3.21 per 100 persons in Nigeria have firearms, whereas 224,200 and 362,400 guns were in the possession of the military and other law enforcement agencies, respectively.

    This is by far the highest number of civilian small arms and light weapons in any African country. The same organisation posits that Nigeria has more Improvised Explosive Devices (IEDs) than any country in sub–Saharan Africa.

    The economy of SALW is growing and robust in Nigeria due to the multifactorial and complex situations fuelling the proliferation of illicit SALW.

    These factors include illegal smuggling of weapons through our porous borders, the conflict in the Sahel region in recent times, stolen firearms and gunrunning by rogue security personnel, a thriving local arms industry in places like Awka, Calabar, Lagos and other known local weapon manufacturing locations in Nigeria, illegal mining activities and oil bunkering, drugs and narcotics linkages, political violence especially during elections, armed vigilantes and extremists, and private security outfits.

    The demand and supply of these weapons are growing, creating a vicious circle of use of these weapons to perpetuate criminality.

    The superiority of the man with the gun over others who do not, and his ability to bend others to his whims and caprices, makes ownership of illicit arms attractive to many, even if not for use in criminal acts, but for self-defence. This is the bane of Nigeria. Citizen’s self-help in security issues is an aberration and does not help the SALW conundrum Nigeria has found itself.

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    Nigeria has attempted to combat this issue, including participating in international initiatives, and implementing various policies and programs to control the spread of illicit weapons.

    I must acknowledge the work done by the Amnesty office, which has conducted small arms and light weapons amnesty at various times. They collected many SALW in exchange for giving the people who submitted them cash incentives. Furthermore, the Nigerian government has set up legislative, institutional, and policy frameworks to tackle this menace.

    The National Commission for the Coordination and Control of Proliferation of Small Arms and Light Weapons is one such instrument to deal with these issues. However, not much has been heard of the activities of this agency.

    Notwithstanding , continued commitment and collaboration at the national and international levels are crucial for effectively addressing the epidemic of illicit small and light weapons in Nigeria and creating a more stable and secure environment for its citizens.

    Addressing the challenge of illicit SALW in Nigeria requires a combination of strategies and multifaceted approach that involves cooperation between the government, security agencies, and international partners. Strategies might include a nationwide arms decommissioning exercise, strengthening border controls to prevent the influx of weapons, improving intelligence-gathering mechanisms to track illicit arms trafficking, and implementing disarmament, and reintegration programme to retrieve weapons from non-state actors and reintegrate them into society.

    Furthermore, promoting community-based initiatives, fostering dialogue, and investing in socio-economic development can help address the root causes of conflicts, thereby reducing the demand for these weapons. Strengthening law enforcement and promoting judicial reforms are also essential in ensuring that those involved in the illicit arms trade face legal consequences.

    It is time to strengthen appropriate institutions to enforce laws and regulations on the control of SALW. We must upend the penalty and punishment for bearing illegal arms and ensure people know the severe consequences of being caught with illicit arms.

    We must invest in Intelligence to track the movement and location of these illegal arms and take the war to those who engage in this unlawful and dangerous business.

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    We must remember that we can either cut off the supply for SALW and watch the demand fizzle away or vice versa. Any actions or inactions that will hurt the SALW economy will be in the right direction. Political merchants and their thugs should never forget that Small Arms and Light Weapons (SALW) live longer after elections.

    Government at all levels must collaborate with civil societies and other interested local and international agencies to systematically reduce the risk of proliferation and transfer of SALW by confiscating and destroying these weapons.

    They must raise awareness, especially among children and youths, about the dangers of illicit SALW through a robust and well-organised campaign, education, outreach, and representation.

    They must implement evidence-based policies and practices to control the spread of SALW. Private citizens must resist the desire to resort to self-help in the issue of insecurity, thereby worsening the scourge of weapon proliferation. The government must take back control of the security of the nation, which is its primary role, and give citizens confidence that the government can and will protect their lives and property.

    The proliferation of SALWs, occasioned by multiple factors of porous national borders, allows for the smuggling of these weapons from other countries connected with previous and present conflicts in Sub-Saharan Africa and North Africa, a booming business of gunrunning by security personnel, a thriving local arms industry and nonexistence of a robust and fit-for-purpose regulatory and enforcement mechanism are the main factors fuelling Nigeria’s security challenges, giving rise to criminal activities across the country.

    This grim revelation does not bode well for Nigeria, especially at this critical time when the nation is experiencing severe economic and security challenges across almost all the regions. It is time we stepped up our game to confront illicit SALW and start resolving our insecurity problems.

    The government must take back control of its supremacy in the use of instruments of coercion in Nigeria and make most non-state actors disengage in trying to control some or all parts of the Nigerian state.

     

  • High Cost of Government, Low Outcome

    High Cost of Government, Low Outcome

    President Bola Ahmed Tinubu has taken both symbolic and structural actions to demonstrate his belief that the current high cost of government is not sustainable.

    The first was an announcement or executive order directing Ministries,Departments and Agencies(MDAs)to slash the size of official delegations for foreign and domestic trips by up to 60 per cent – an action that resonated with the mood in the country.

    The second is the Federal Executive Council’s approval to implement Steve Oronsaye’s report on the merger and scrapping of MDAs.

    This structural action is a baby step, albeit good for proponents of a complete overhaul of government structure . Both measures are more symbolic than substantive. However, it clearly shows that the government realises the negative impact of high government costs on economic growth and providing services to the people.I acknowledge as a fact that a US type presidential system tends to be big by constitutional requirement. And  in a country where government is both an industry and a social welfare institution, the tendency for big expansive government is high.

    Beyond the symbolic actions, which have their values, is the need for substantive actions and a complete attitudinal change towards waste and profligacy in government.

    We have had enough debate on the  unwieldy and inefficient size and structure of government, our leaders have enough ideas  and justifications to prune down the size of government. The only ingredient left to make that happen is the political will.  I can imagine the government is caught between a public opinion pressure to cut costs and a constitutional imperative to assemble a huge choir.

    On attitude, most government officials have yet to come to terms with the reality of our economic downturn and the need to be more disciplined, prudent and productive .The signals from high officials of government are both depressing and insensitive. For these reasons, we are focusing today on those little acts of prudence that we do every day and, over time, will make a substantial difference.

    Political officeholders must have an attitude change in ostentatious living and craving for opulence and status within the society.   It is obvious to all that the pomp and festival of political office attracts a mob of political hangers on whose presence bloats government costs. Trimming that is a matter of personal choice and strength of character.

    In our clime, politics and wealth are almost synonymous; politicians compete and outcompete wealthy people in a show of wealth and power. The blaring of sirens and long motorcades of expensive and luxury SUVs conveying our political office holders in federal, state, and LGA is almost becoming a public nuisance and separating them from the people they should serve. Cutting down on this lifestyle is long overdue.

    This attitude flies in the face of our current reality, where many suffer and struggle for the basics. Frank Herbert, American Writer, argues, “Good governance never depends upon laws but the personal qualities of those who govern. Government machinery is always subordinate to the will of those who administer that machinery.”

    We expect attitudinal change among political officeholders on abuse of official property, including official vehicles assigned to them. Many use this as personal property and sometimes even allow family members and friends to damage these properties. We must also jettison the culture of assigning many security attachés to VIP and political office holders.

    We know the security situation in the country is dire but wasting the existing security personnel and apparatus on a few political officeholders when many Nigerians need these security officers to work to secure their lives and properties is deplorable. Just as political officeholders’ lives matter, so do the lives of ordinary Nigerians.

    It is disheartening that some of the political officeholders are still in a permanent political campaign mood, not knowing it is time to govern.

    They spend ten times the cost of a single project on project flag off or commissioning.  Corruption is  still pervasive, and mismanagement of public funds exacerbates the high cost of government. Funds allocated for public projects and services are diverted, budgets are padded, and fiscal prudence is thrown to the dogs.

    The level of corruption among public officials is still alarming and must be challenged and exposed, and perpetrators made to account to the law for their dastardly acts.

    Some structural changes and constitutional amendments  are needed to cut down on the cost of governance in Nigeria. Cutting down on our bloated bureaucracy is essential to save costs.

    This is the aim of implementing the Oronsaye report. The government should reduce the number of  political appointees and close inefficient public enterprises that incur losses that the government eventually covers. We cannot preach the message of fiscal prudence when the number of political appointees gets  bigger every year.

    Efforts have been made in Nigeria to address the high cost of governance, such as implementing cost-cutting measures and promoting transparency. However, achieving substantial changes requires a comprehensive and sustained approach, including structural reforms, anti-corruption efforts, and a focus on improving public sector efficiency.

    Addressing the issue of high governance costs is crucial for ensuring that resources are allocated efficiently to promote economic development and enhance the standard of living for the Nigerian people.

    More disheartening is the fact that the high cost of government has not translated to administrative efficiency,quality services or high policy outcomes. Nigeria’s government effectiveness index for 2022 is -1.04, one of the worst globally. The index of government effectiveness captures the perception of the quality of public services, the effectiveness of implementing government decisions, the innovation capacity of political leadership, public healthcare, and public schools, amongst others. The maximum score is +2.5, and the minimum score is -2.5.

    Our budget and expenditure on critical sectors such as education and healthcare , by percentage, has not improved over the years. The spending has also not delivered on indices. Our maternal mortality ratio is still at 814 per 100,000, while the mortality rate for infants and children under five years is 70 and 104 per 1,000 live births, respectively. This is one of the highest globally.

    I recently had a two-hour discussion with the Minister of Health, Prof Ali Pate, and the Minister of State for Health, Dr Tunji Alausa. Their clarity of vision, grand strategy and commitment have raised my hopes and expectations for the healthcare sector. Watch out for a different trajectory  in this sector in the immediate to near future.

    The education sector indicators are similar. Government expenditure on primary education for year 2022  is below 0.5%, the ratio of trained teachers in primary school is 62.18, and the pupil-trained teacher ratio is 49.1, all below the West African regional average. According to the USAID dashboard, the enrollment rate and government expenditure at secondary schools are also below the regional average.

    This abysmal data is coming out of the same country that borrows to fund the lifestyle of government officials. Nigeria and Nigerians are stranded between poverty, insecurity, dearth of infrastructure and profligacy of government officials. These statistics speak volumes and are better than any propaganda that means nothing to the average citizen.

    Addressing Nigeria’s high government cost requires a multi-faceted approach involving structural reforms, fiscal responsibility, attitudinal change and increased transparency. I will articulate a few solutions that we may have to consider in reducing the cost of government.

    Apart from the obvious answer of fighting corruption, wastage, profligacy and implementing measures to enhance transparency in public financial management, procurement, and project execution to curb corruption, the government should first undergo a more thorough public sector review than just adopting some part of a report authored over ten years ago and may not fit in with our current realities.

    The government should comprehensively review its structure, eliminating duplications and streamlining ministries, agencies, and parastatals to reduce bureaucracy. This is urgent.

    Second, implement a rational and transparent salary structure for public officials, aligning remuneration with economic realities and the country’s financial capacity and regularly review same  and ensure competitiveness.

    Third, introduce cost-cutting measures in government operations, such as reducing unnecessary travel expenses, minimising overhead costs, and optimising resource allocation.

    Fourth, embrace  e-government through technology to enhance efficiency in government processes, reducing paperwork and associated costs.

    Fifth, develop a sustainable debt management strategy to reduce reliance on borrowing.

    Sixth, implement and enforce fiscal responsibility laws to ensure that government spending aligns with budgetary allocations and regularly review and update budgetary priorities to reflect changing economic conditions and development needs.

    Finally, encourage citizen participation and oversight through platforms allowing the public to monitor government spending, hold officials accountable, and foster a culture of fiscal responsibility and transparency through public awareness campaigns.

    Implementing these solutions requires strong political will, commitment from government officials, and collaboration with various stakeholders. Mr President has started to address the elephant in the room of inefficient government structure, but should take a step further by empaneling full e-governance . He would also gain the trust of the people and mileage by leading by personal example on attitudinal change of government officials . The country just needs champions of fiscal discipline and probity .

  • Air Peace, Capitalism, and National Interest

    Air Peace, Capitalism, and National Interest

    Nigerian corporate influence and that of the West continue to collide. The rationale is straightforward: whereas corporate activity in Europe and America is part of their larger local and foreign policy engagement, privately owned enterprises in Nigeria  or commercial interests are not part of Nigeria’s foreign policy ecosystem, neither is there a strong culture of government support for privately owned enterprises’ expansion locally and internationally.

    Nigerian firms’ competitiveness on a global scale can only be enhanced by the support of the Nigerian government.  It is evident that relationship between Nigerian businesses  and foreign policy is important to the national interest. When backing domestic Nigerian companies to compete on a worldwide scale, the government should see it as a lever to drive foreign policy, national strategic interest, promote trade, enhance national security considerations, minimize distortion in the domestic market as the foreign airlines were doing, boost GDP, create employment opportunities, and optimize corporate returns for the firms.

    For example, the South Korean mega conglomerates within the chaebols corporate structure, such as Samsung, Daewoo, SK Group, LG, and others, have become globally recognizable brands thanks to the backing of the South Korean government.

    For Chaebol to succeed, strong collaboration with the government has been essential.

    Also, in telecommunications, Huawei would only be such a well-known brand worldwide with the backing of the Chinese government. The opposite is the case with Nigeria.

    Admitted nations do not always interfere directly in their companies’ business and commercial dealings, and there are always exceptions. I can cite two areas of exception: military sales by companies because of their strategic implications and are, therefore, part of foreign and diplomatic policy and processes.

    The second is where the products or routes of a company have implications for foreign policy. Air Peace falls into the second category in the Lagos – London route.

    Two events demonstrate an emerging trend that, if not checked, will disincentivize Nigerian firms from competing in the global marketplace. There are other notable examples, but I am using these two examples because they are very recent and ongoing, and they are typological representations of the need for Nigerian government backing and support for local companies that are playing  in a very competitive international  market dominated by big foreign companies whose governments are using all forms of foreign policies and diplomacy to support and sustain.

    The first is Airpeace. It is the only Nigerian-owned aviation company playing globally and checkmating the dominance of foreign airlines. The most recent advance is the commencement of flights on the Lagos – London route.

    In Nigeria, foreign airlines are well-established and accustomed to a lack of rivalry, yet a free-market economy depends on the existence of competition. Nigeria has significantly larger airline profits per passenger than other comparable African nations.

    Insufficient competition has resulted in high ticket costs and poor service quality. It is precisely this jinx that Airpeace is attempting to break. On March 30, 2024, Air Peace reciprocated the lopsided Bilateral Air Service Agreement (BASA) between Nigeria and the United Kingdom when the local airline began direct flight operations from Lagos to Gatwick Airport in London.

    This elicited several reactions from foreign airlines backed by their various sovereigns because of their strategic interest. A critical response is the commencement of a price war. Before the Airpeace entry, the price of international flight tickets on the Lagos-London route had soared to as much as N3.5 million for the  economy ticket. However, after Airpeace introduced a return economy class ticket priced at N1.2 million, foreign carriers like British Airways, Virgin Atlantic, and Qatar Airways reduced their fares significantly to remain competitive.

    In a price war, there is little the government can do. In an open-market competitive situation such as this, our government must not act in a manner that suggests it is antagonistic to foreign players and competitors.

    There must be an appearance of a level playing field. However, the government owes Airpeace protection against foreign competitors backed by their home governments. This is in the overall interest of the Nigerian consumer of goods and services. Competition history in the airspace works where the Consumer Protection Authority in the host country is active.

    This is almost absent in Nigeria and it is a reason why foreign airlines have been arbitrary in pricing their tickets. Nigerian consumers are often at the mercy of these foreign firms who lack any vista of patriotism and are more inclined to protect the national interest of their governments and countries.

    It would not be too much to expect Nigerian companies playing globally to benefit from the protection of the Nigerian government to limit influence peddling by foreign-owned companies. The success of Airpeace should enable a more competitive and sustainable market, allowing domestic players to grow their network and propel Nigeria to the forefront of international aviation.

    The second is Proforce, a Nigerian-owned military hardware manufacturing firm active in Rwanda, Chad, Mali, Ghana, Niger, Burkina Faso, and South Sudan. Despite the growing capacity of Proforce in military hardware manufacturing, Nigeria entered two lopsided arrangements with two UAE firms to supply military equipment worth billions of dollars , respectively.

    Both deals are backed by the UAE government but executed by UAE firms. These deals on a more extensive web are not unconnected with UAE’s national strategic interest.

    In pursuit of its strategic national interest, India is pushing Indian firms to supply military equipment to Nigeria. The Nigerian defence equipment market has seen weaker indigenous competitors driven out due to the combination of local manufacturers’ lack of competitive capacity and government patronage of Asian, European, and US firms in the defence equipment manufacturing sector.

    This is a misnomer and needs to be corrected. Not only should our government be the primary customer of this firm if its products meet international standards, but it should also support and protect it from the harsh competitive realities of a challenging but strategic market directly linked to our national military procurement ecosystem. The ability to produce military hardware locally is significant to our defence strategy.

    This firm and similar companies playing in this strategic defence area must be considered strategic and have a considerable place in Nigeria’s foreign policy calculations. Protecting Nigeria’s interests is the primary reason for our engagement in global diplomacy.

    The government must deliberately balance national interest with capacity and competence in military hardware purchases. It will not be too much to ask these foreign firms to partner with local companies so we can embed the technology transfer advantages.

    Increasingly, other companies, especially in the banking and fintech sectors, are making giant strides in global competitiveness. Our government must create an environment that enables our local companies to compete globally and ply their trades in various countries.

    It should be part of the government’s overall economic, strategic growth agenda to identify areas or sectors in which Nigerian companies have a competitive advantage, especially in the sub-region and across Africa and support the companies in these sectors to advance and grow to dominate in  the African region with a view to competing globally.

    Government support in the form of incentives such as competitive grants ,tax credit for consumers ,low-interest capital, patronage, G2G business, operational support, and diplomatic lobbying, amongst others, will alter the competitive landscape. Governments  and key government agencies in the west retain the services of lobbying firms in pursuit of its strategic interest.

    Nigerian firms’ competitiveness on a global scale can only be enhanced by the support of the Nigerian government. Foreign policy interests should be a key driver of Nigerian trade agreements. How does the Nigerian government support private companies to grow and compete globally? Is it intentionally mapping out growth areas and creating opportunities for Nigerian firms to maximize their potential? Is the government at the domestic level removing bottlenecks and impediments to private company growth, allowing a level playing field for these companies to compete with international companies?

    Why is the government patronising foreign firms against local firms if their products are of similar value? What was the rationale for flight tickets from Lagos to London costing N3.5M for the economy class just a few weeks ago only to come down to N1.3M with the entrance of Airpeace to the market? Why are Nigerian consumers left to the hands of international  companies in some sectors without the government actively supporting the growth of local firms to compete in those sectors?

    These questions merit honest answers. Nigerian national interest must be the driving factor for our foreign policies, which must cover the private sector, just as is the case with most developed countries.

    The new global capitalism is not a product of accident or chance; the government has choreographed and shaped it by using foreign policies to support and protect local firms competing globally. Nigeria must learn to do the same to build a strong economy with more jobs.

  • Bad Law, Needless Levy

    Bad Law, Needless Levy

    A few weeks ago, Nigerians were startled by a legislation that had largely escaped public awareness. This legislation, which has since undergone substantial amendment carries profound implications for the financial health of every Nigerian, sparking widespread controversy.

    The law raises several concerns regarding our legislators’ rigour, effort, and dedication to enacting laws. The legislation, which is known as the Cybercrime (Prohibition, Prevention, etc.) (Amendment] 2024 Act. Section 44 (2] (a] of the Act, mandated a levy of 0.5% of all electronic transactions value by businesses specified in the second schedule of the Act, which includes GSM service providers and telecommunication companies, Internet Service Providers, Banks and other financial institutions, Insurance companies and Nigeria Stock Exchange.

    To implement this law, the CBN, on the 6th of May 2024, sent a circular to all banks and financial institutions in Nigeria to charge a cybersecurity levy starting from the 20th of May 2024 on electronic transactions by customers, barring a few exemptions. Industry watchers have claimed that the government aimed to earn about N2 trillion per annum, judging by the over N600 trillion values of all such transactions in 2023. This caused an uproar in the country, and most civil society organizations, private sector businesses, labour organizations, and concerned Nigerians used all the media available to them to voice their condemnation of this imprudent law.

    The banks and other mandated institutions are to collect the levy and remit it monthly to a designated fund (National Cybersecurity Fund) at the CBN for transmission to the Office of the National Security Adviser (ONSA). The fund’s stated primary purpose is to provide financial resources for fighting cybersecurity crimes in Nigeria.

    There are many things wrong with this levy beyond the fact that Nigerians are discontented with government and non-governmental levies and fees plaguing the living light out of them. Some have argued about the interpretation of the law by CBN that the transactions to be charged should be on the businesses mentioned in the Act, not their customers or Nigerians. Others have questioned why this law, created, and signed into law in 2015 by the Jonathan administration, was amended now to include the cybersecurity levy and why the haste to implement it now, especially given the harsh economic conditions occasioned by good-intentioned policies that have had a devastating impact on Nigeria.

    The argument on timing is germane given the level of inflation and the devastating degradation of the value of the Naira and, by extension, the purchasing power of Nigerians. Some still argue about the increasing focus of government to use tax as a significant economic policy for revenue generation, especially in an increasingly volatile economic climate where productivity is low, and businesses are shutting down because of increasing cost of doing business, ranging from the cost of labour, energy, and raw materials. My take on this anchor on the morality behind the levy given Nigeria’s social contract with the state, procedural antecedents in institutional revenue collection for government, the burden on Nigerians on financial transaction-related charges, and the imperfections of our legislative processes.

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    The pertinent question is why should Nigerians who pay personal and business taxes pay for security in whatever guise or nomenclature? Whether cybersecurity, physical security, or any form of security, it is the Nigerian government’s exclusive and primary responsibility, which is why we pay  tax to the government. Under the social contract between Nigerians and the state, we accept and give out our rights, especially the right to security of our lives, to the state and expect the state to protect us by whatever means necessary. The state provides the security infrastructure, architecture, and personnel to provide security for all. The government singling out an aspect of security and levying citizens to pay for it is tantamount to double taxation when we already pay income tax and allow the government income from our natural resources to provide this service. Unbundling security and taxing some is a prelude to other security tax forms. Should we expect a Banditry levy, terrorist levy, or armed robbery levy soon?

    The second question is, when did the office of the National Security Adviser become a revenue-generating and collecting centre? The Nigerian state has explicit provisions for regulatory agencies or public enterprises that provide public goods and services. The office of the NSA is not such and does not have such a mandate. It is an anomaly procedurally to saddle this office with the mundane task of revenue issues, and as a government unit coordinating security, it should receive its funding from the federal government budget. Enacting and implementing laws that go against established procedures affects the structures and systems of the state and sometimes goes against the mandate on which institutions are created.

    The third issue is why the national assembly members were screaming at the top of their voices against this law when the same body amended it. Does it mean that they did not understand the law they passed? Or is it that the law was amended and passed without the knowledge of many members passing through the due processes? Is the interpretation of the law by CBN not in tandem with the intentions of the lawmakers? Is there a problem with framing the law caused by language failure? Did the framers mean online or electronic transfer levy? It would be easier for the public to understand the levy if it had come outright as a transaction levy because many people cannot link their electronic transactions and cyber security levy. Where is the ‘cybersecurity’ in transferring legitimate money? The law does not resonate with many Nigerians of average means and education, and they cannot link their everyday transactions to cybersecurity.

    Granted, the legislation enacted by the National Assembly is not perfect. It sometimes has some flaws. They are subject to review, revision, or repeal. Because of this, the law is a living thing that changes with the seasons and the passage of time. Remember, errors are not uncommon when enacting laws. Had Magaji Tambuwal, the then-Clerk of the Nigerian Assembly, been successful in getting President Bola Tinubu to sign a version of the “Real Estate Regulatory Council of Nigeria 2023″—which is regarded as phoney—into law, he would have been inducted into the Hall of Fame. This demonstrates that sometimes, legislation approved and accented to by the president may not always accurately reflect the framers’ intentions. Numerous things occur in between.

    The fourth issue is the incongruence of the cybersecurity levy while the Taiwo Oyedele committee is working on the harmonization of multiple taxes, reducing unprogressive taxes and  the multiplicity of legislation that imposes taxes on business. Besides, the cybersecurity levy affects citizens’ living wages. We cannot stagnate household income and continuously increase all cost elements of a living wage (housing, transport, utilities, food) through more charges like cybersecurity levy and not increase poverty in the extreme or diminish consumption income in the main.

    The last issue is that the burden of bank-related levies and taxes that individuals pay in Nigeria is too much on them. It will be good for researchers to do a comparative study with other developing countries like Nigeria to determine whether we are in this alone. Bank-related levies include transfer fees, card maintenance fees, card issuance charges, stamp duties, VAT on SMS, and SMS charges for the receiver and sender. This cybersecurity levy will be one too many. Imagine the implication on the cost of doing business, especially post-subsidy removal, post-increase in electricity tariff, the collapse of the Naira, hyperinflation and many charges and levies on businesses.

    Existing business levies and taxes include Company Income Tax, Stamp Duties, Petroleum Profit Tax, Capital Gains Tax, Value Added Tax, Personal Income Tax, Withholding Tax, Tertiary Education Tax, one per cent of payroll contribution to NSITF, 10 per cent of Payroll Contribution to PenCom; one per cent of Payroll ITF Levy and National Information Development Levy. Others are Radio and TV Licenses; Police Special Trust Fund Tax levy; Niger Delta Development Commission levy; National Agency for Science and Engineering Infrastructure levy; Land Use Charge; Parking Fee; Consumption Tax; Road Tax; Standard Organization of Nigeria fees; Nigeria Content Development levy; NAFDAC levy; Nigeria Health Insurance Authority contribution; Signage Fees. Touts and street urchins are leveraging the multiplicity of taxes and levies to attack businesses. Businesses are getting it rough and do not need another levy straw that will break their backs.

    Cybersecurity levy is peculiar to Nigeria and is not applicable in many developing and developed countries of the world. President Bola Ahmed Tinubu acted well in suspending the cybersecurity levy; many Nigerians are happy about that. There are many reasons to repeal this law or quickly review it with broad-based consultations.

  • The Scourge of Rising Inflation

    The Scourge of Rising Inflation

    An increasing number of Nigerians are being driven into poverty, not by choice, but by the current political and economic climate, shaped by stringent macroeconomic policies.

    These policies, such as subsidy removal, devaluation of Naira, and increase in electricity tariff, have had unintended consequences. For instance, removing subsidies has led to a significant increase in the cost of living, while the devaluation of Naira has made imported goods more expensive.

    These factors, combined with the high level of insecurity, have affected food security in Nigeria, and created a perfect storm of economic hardship. The signs of this unavoidable reality are readily apparent. The interventions to prevent this descent into poverty are either ineffectual or remedy the condition too slowly.

    An unprecedented rise in inflation has destroyed households’ disposable incomes and pushed many families into poverty. Spiralling inflation is having a devastating impact on all, but especially on households in the lower rungs of the working class, who in their millions are joining the already over 133 million multidimensionally poor Nigerians struggling to earn a living because high inflation has eroded the value of their income. As shown by the NBS Consumer Price Index of April 2024, published in May 2024, the headline inflation rate rose to 33.69% in April 2024 compared to March.

    The headline inflation rate was 11.47% higher in April 2024 compared to the previous year. During the same period, inflation in urban areas was higher than in rural areas. Even worse, the food inflation rate in April 2024 was 40.53%, increasing by 15.92% compared to April 2023. What does this mean for the ordinary citizen? More money can purchase fewer goods and services.

    We cannot dismiss the direct correlation between rising inflation and rising poverty in Nigeria. A household with a monthly income of N300,000 in April 2023 would have lost 33.69% of its real purchasing power if it earned the same amount in April 2024.

    This means that the same amount of money can now buy significantly fewer goods and services, putting a strain on the household’s budget. Imagine this household struggled in 2023 to make ends meet; how will it cope with less than 33% of its value in goods and services this year?

    It is little wonder many Nigerians are in despair and are calling on the government to tweak its policies and salvage the situation before it is too late. Families in the earning bracket mentioned above are even better than many whose total income is less than N100,000 if both parents in the household earn minimum wages per month.

    The government intervention so far, with the best of intentions, has yielded little result as inflation continues unabated. The monetary policies of increasing base interest rates to above 22%, improving the cash reserve ratio by banks to above 40%, and constantly engaging in the money market to mop up excess liquidity have yielded less than the expected result in curbing inflation.

    More is needed, and my little knowledge of street economics shows me that the Nigerian economy often defies some fundamental economic concepts that work in developed countries because of our economy’s informal and unregulated nature.

    The Nigerian government must creatively use other bespoke and practical fiscal and monetary measures to tame our raging inflation.

    Paradoxically, there is compelling evidence that inflation continues to rise because of critical government policies. Instead of providing more concerted anti-inflationary measures, the government has added more inflationary steps to the economy.

    The government cannot confront inflation while imposing limitless taxes, tariffs, and charges on the things that people spend money on daily. The impact of excess tax is on everybody, but the burden is more on people experiencing poverty whose purchasing power has been eroded by inflation. The government cannot tax itself out of our economic predicament.

    Increasing personal income tax is one way government reduces disposable income to curb demand pull inflation, but the inflation in Nigeria is not because of increase in household income, but caused by cost induced factors. So tax on people whose income have not increased in the past year is a recipe for hardship.

    Other factors also imperil government efforts to curb inflation. Imported inflation has been the bane of Nigeria, given the number of raw materials and goods imported into Nigeria from countries with high inflation rates. This is not helped by the new exchange rate regime that has seen the Naira fall to its lowest value in a generation.

    The government has been trying to control the erosion of the value of Naira to no avail. Increasing cost of energy has pushed  some  businesses to  pack up. These factors have exacerbated the rise of inflation, and unless the government starts tackling them, it cannot effectively win its fight against runaway inflation.

    The consequences of inaction are severe and far-reaching. The system requires a set of anti-inflationary measures to relieve the people and companies so that livelihoods can improve, and real incomes recover from shock to encourage people to live and save. Savings and prosperity will fire up investment, production, supply, and consequent demand.

    If inflation worsens, the economy will, at best, go into stasis, further regression, and possibly a depression. More manufacturers will quit, and unemployment will worsen with even more crime and insecurity. The picture I painted above is not far from us.

    Recent statistics about the hunger level in Nigeria occasioned by food inflation are alarming.

    There is a deteriorating food security and nutrition crisis in Borno, Adamawa and Yobe (BAY) states this lean season between May and September 2024. According to the Government-led Cadre Harmonise analysis released in March this year, in Borno, Adamawa, and Yobe states, some 4.8 million people are estimated to be facing severe food insecurity, the highest levels in seven years.

    Children, pregnant and lactating women, older persons, and people living with disabilities are among those who are most vulnerable. About 2.8 million of these people need urgent interventions.

    The prices of staple foods like beans and maize have increased by 300 to 400 percent over the past year because of a cocktail of reasons. Inflation is outpacing the ability of families to cope, making essential food items unaffordable.

    Furthermore, the report stated that “malnutrition rates are of great concern. Approximately 700,000 children under five are projected to be acutely malnourished over the next six months, including 230,000 who are expected to be severely acutely malnourished and at risk of death if they do not receive timely treatment and nutrition support.”

    The Acting Representative of UNICEF Nigeria argues that “this year alone, we have seen around 120,000 admissions for the treatment of severe acute malnutrition with complications, far exceeding our estimated target of 90,000”.

    This statistics are for only 3 states in the Northeast Nigeria. Imagine what it will be for the whole 36 States in Nigeria. There is real fire on the mountain!

    This rising hunger is not peculiar to the Northeast. From my knowledge of street economics, hunger and poverty is pervasive across all six geopolitics zones. Increasing poverty is directly linked with more severe economic outcomes. Increasing poverty can result in a more divided society, Issues with housing, homelessness, limited access to healthcare, nutrition poverty and poor living conditions that have a detrimental effect on one’s health. Children living in poverty have less access to education, which will reduce their chances in the future. More families facing poverty will experience conflicts, stress, and domestic violence.

    Poverty can set off a vicious cycle in which the effects of it act as catalysts for additional episodes of poverty. Increasing inflation and poverty are bad omens that blow us no good. They are bad for our economy. They are bad for our people. The government must pay attention to these factors and be more sensitive in our economic policy choices.

    Only some anti-inflationary measures that comprehensively capture the macroeconomic dimensions and provide solutions may work. Poverty alleviation measures are barely temporary and, at best, work in the short run to cushion the effect of heightened inflation and food insecurity.

    The government should provide solid medium- to long-term solutions to tackle these problems. They should re-evaluate some of their policies to see whether they are inflationary and jettison them to allow good policies to thrive. We can only imagine the unintended consequences of allowing poverty and inflation to fester.

    The increasing inflation and poverty are creating desperation among a portion of society, which is increasingly becoming despondent and seeing itself at the fringes of society.

    The implications of this are plausible. Many ordinary citizens are burdened by poverty, hunger, and severe inflation, which have made their lives miserable. The government must take action to alleviate this scourge and help Nigerians lead meaningful lives.