welcome to Adegokblog: 10/11/17

Buhari's Corruption Is More Innocent Than Yours By Emmanuel Ugwu

All of a sudden, the Buhari administration that is given to shouting anti-corruption from the rooftop has adjusted to the inviolate, otherworldly quiet of a Buddhist monastery. The dubious 9 trillion naira contract fraud exploded by Ibe Kachikwu’s ‘leaked’ memo has forced them into preternatural speechlessness.

President Buhari, who cornered the position of the Minister of Petroleum Resources, on the pretext that he was the only Nigerian qualified in integrity and experience to transform the Nigerian National Petroleum Corporation from a den of thieves to a sane institution governed by global best practices, is hiding behind the veil of silence. He is unwilling to publicly acknowledge the mindboggling scam within his zone of supervision and field of vision, one which represents the criminal hijack of the equivalent of Nigeria’s 2017 budget and its opportunity costs in infrastructure.
Buhari's aides, likewise, have offered no comment, cryptic or revealing. And Kachikwu, the Minister of State for Petroleum Resources, who after being repeatedly frustrated by a Gaza-grade blockade mounted to scuttle his many attempts to meet with Buhari to table the matter before him, was summoned to a hurriedly arranged audience, eventually walked out the president’s office, saying no more than "no comment" to the pressmen who had been waiting for one hour to hear from the horse’s mouth.
The NNPC contracts and the leaked memo that burst it like a gigantic balloon of pus are the issues of the day in Nigeria. But the Buhari presidency is acting like it is the scandal rocking the government of a distant banana republic. They have kept mum, as if it were an imported rumor they could not to afford to be interested in. They are secure in their shell of indifference, in their distance of uppermost caste snobbery, in their scorn of the right of the people to answers.
The most President Buhari has done is try to calm the scandal as a baby screaming in the midnight. He invited Kachikwu to Aso Rock to discuss the memo he had ignored before it leaked. He appeased the junior minister and "ordered" a truce, a return to "sanity."
On the same day, in a related effort at damage control, Vice President Yemi Osinbajo sat down for a chat with Maikanti Baru, the Director General of NNPC, the man who singlehandedly signed away a contract figure that could effectively run the federal government of Nigeria for a whole year. Osinbajo relayed Buhari's message to Baru: end the turf war with Kachikwu, stop the bickering, let sleeping dogs lie.
With Kachikwu placated and sworn to silence by President Buhari and Baru given a homily on peace by Pastor Osinbajo, the presidency has answered the 9 trillion naira question, "settling" it like an incident of sibling rivalry. A tiny brotherly squabble. A family misunderstanding that slipped through the crack on the wall and escaped into the public square.
Buhari resolved the issue with avuncular politesse. He addressed the monumental fraud as though it were a mere battle of supremacy between two of his appointees. He presumed on the powers of his office to whitewash a criminal act and foreclose the materialization of the appropriate consequences. He obstructed justice in the guise of peacemaking.
There was no outrage from the self-styled avenging angel of corruption. He condoned the fraud. He excused it.
Buhari defined corruption downwards. He said the award of the 9 trillion naira contract in violation of statutory rules was not corruption. It’s not a big deal. It’s a quarrel.
Most Nigerians nursed the hope that the reproach of the casual disappearance of billions of petrodollars from the NNPC has passed away with President Goodluck Jonathan and his covetous Oil Minister, Diezani Alison-Madueke. That NNPC would not be the ever-spitting ATM that serves the avarice of the few in the Buhari era. That he will not abide the crazy looting of public funds.
Today, they see that Buhari they had placed on a pedestal perpetuating the corruption he was elected to stop. They see him cover up the $25 billion fraud in NNPC the selfsame Jonathan waffled on the missing of $20 billion from the NNPC.
What’s even worrisome is that the curious concatenation of "coincidences" - Buhari’s avoidance of a facetime with Kachikwu, his neglect of the minister’s memo, and his insistence that the "juicy" oil contracts that are apparently not kosher stand as awarded- suggests that Buhari may have personally benefited from deals. Analysts are agreed that the highly consequential contracts could not have happened without his imprimatur. He signed off on them.
Buhari’s government recently launched a whistleblower policy, established a token reward for whistleblowers and gleefully celebrated receiving over 5000 tips and 365 "actionable" ones from Nigerians. It’s very suspicious that when Buhari’s own minister sent him a whistleblowing memo talking about public money in the order of $25 billion, he saw it as anything but an opportunity to fight corruption. Rather, he tucked away the note like the scrap of a forgettable diary. He hid it like a bad gift, an ugly keepsake; willing it to rot till thy kingdom come.
Buhari often talks about "corruption fighting back." His burial of the memo was corruption fighting front. It was putting corruption in the lead.
Many people have expressed concern that the plot of the contracts bears the hallmarks of a typical Nigerian pre-election heist. Normally, the incumbent president, as a matter of precedence, begins to build his second term campaign war chest midway into his first term. He gives himself a head start by looting the cash cow federal agencies by dashing out outrageous contracts to his cronies. That way, he "empowers" them to help him buy the vote.
Buhari’s allies have already started laying the groundwork for his second term bid. And he appears to have turned to NNPC, the good old money tree that he can shake slightly and have cascades of windfall. This is probably why he can’t recognize corruption in the 9 trillion naira contracts.
Buhari bequeathed Nigerians the aphorism, "If Nigeria does not kill corruption, corruption will Nigeria." He calls himself as the commander of Nigeria's first ever serious war against corruption. He is quick to pounce on former officials for corruptly enriching themselves. But when confronted with the facts of his own corruption, he legitimized the wrongdoing and called it proper.
Buhari asked Kachikwu and Baru to let "sanity" prevail. Don’t duel in such a manner as to invite public scrutiny to the NNPC. Get along well and make our regime of the underhand contracts peaceful.
He sued for a return to "sanity." If 9 trillion naira fraud occurred in an atmosphere of "sanity," what could the climate of insanity possibly produce? Is "sanity" the new name of insanity?
Without doubt, if Buhari were not involved in the 9 trillion naira fraud, he would surely have regarded it as a heinous crime and treated it as such. But money laundering is clean business when he participates. Wrongdoing loses the quality of a vice if he is the doer. He is exceptional.
In Buhari’s world of moralism, the corruption of the other is criminal while his corruption is legal. Your corruption is evil and his corruption, good. Your corruption is guilty and his corruption, innocent.
You can reach Emmanuel at immaugwu@gmail.com and follow him on Twitter @EmmaUgwuTheMan.

Liberians Still Hope For Peace As They Vote

Thousands lined up at the polling booths in Monrovia, Liberia's capital, for their first democratic transfer of power in 73 years.
Though Liberia is Africa’s oldest modern republic founded by freed U.S. slaves in 1847, its last democratic power transfer, defined as a peaceful handover at the end of a full term, was in 1943.
The outgoing president, Nobel Peace Prize winner and Africa's first female elected president, Ellen Johnson Sirleaf beat former soccer star George Weah to win the election in 2005 after a period of a transitional government following the civil war that ended two years earlier.
Johnson Sirleaf was praised by many Liberians for keeping the peace since the 14-year conflict when gangs of child soldiers, drugged and wearing ammunition belts ransacked through the streets.
Though preparations and voting have been peaceful, former rebel leader, Prince Johnson, is one of the 20 candidates, and the ex-wife of warlord Charles Taylor, now in a British prison, is the running mate of one of the favorites, George Weah, has raised some worry in the country.
Unlike Sierra Leone which had a U.N.-backed court for civil war-era crimes, Liberia has prioritized reconciliation over justice. This means that some of those involved in the war that killed a quarter of a million people are still prominent public figures.
“I am just voting for peace. We want peace right now, peaceful country, we want a peaceful situation now and things to go fine,” said James Marthics, a voter in Paynesville, a suburb of the capital Monrovia.
Some voters waited for hours before dawn to vote, bringing small wooden chairs with them and forming orderly queues as vendors sold them provisions. Early voting in Monrovia went rather smoothly, though there were delays in some areas.
“I need a change of this government that is in power,” said Richard Akoi, 32, a former child soldier who fought for Taylor’s rebels. “I‘m a die-hard fan of former president Taylor and if he shows up today in the election I‘m going to vote for him.”
Johnson Sirleaf urged Liberians to maintain the peace in an address to the nation on the eve of the vote.
“Embrace your neighbor, regardless of their political choice,” she said.
Though results are expected to begin arriving later this week, most analysts think it is unlikely that any single candidate will win a majority of votes on Tuesday, raising the likelihood of a run-off election in early November.
Among the candidates are the favorites such as: Vice President Joseph Nyuma Boakai of the ruling Unity Party known locally as a “countryman” meaning an indigenous Liberian; international lawyer, Charles Brumskine of the Liberal Party; and last but not least, George Weah, who played for AC Milan and Paris St Germain and was greeted at the polling station by lively supporters in football shirts.
Rebel leader, Prince Johnson, who was shown sipping a beer as he directed the torture of President Samuel Doe shortly before his murder in 1990 in an infamous circulated videotape, is considered to have only a remote chance of winning.
Roddy Barclay, director at risk advisory Africa Practice, said the participation of civil war-era figures was unlikely to lead to a “slide back into an era of warlord politics.”

Tinubu's 7-Point Agenda: Matters Arising By Pius Adesanmi

Here is a summary of Tinubu's 7-point agenda:
1) national industrial policy
2) infrastructure plan
3) tax credits and subsidies
4) credit-based economy
5) more electricity generation
6) government-backed home mortgage system
7) investment in agriculture
I find this amusing in Tinubu's address:
“We must realize that no populous nation has ever attained broadly- shared prosperity without first creating an industrial capacity that employs large numbers of people and manufactures a significant quantity of goods for domestic consumption or export.”
I find it amusing because it is a careful rewording of an axiom that is generally applied to education - specifically public education - in the developed parts of the world.
We say that no nation has ever attained modernity, prosperity, development, etc, without laying a solid foundation in public education. The quality of your growth and development is proportional to the quality of your public education.
In a seven-point agenda (Yar'Adua is not even acknowledged) that is totally silent on education, a popular axiom commonly applied to public education in civilization is reworked and repackaged for industrialization.
Who does not know that an under-educated or diseducated citizenry will make everything in this 7-point agenda a non-starter? They will start by selling off the paper on which Tinubu's agenda is written and use the money to buy gala and lacasera in order to have enough strength to scream for 24 hours in support Asiwaju and his ilk in the political leadership of Nigeria.
The ignorance of the people is the greatest wealth and the greatest asset of the Nigerian political elite.
Ask a Nigerian leader to choose between ten oil wells and mass ignorance of the people and you'll be surprised by his choice - if confidentiality were guaranteed.
That is why everything that has happened to the Nigerian education sector is by design. The rot is purposed and deliberate. Too many of our citizens exposed to what we teach their own kids that they send to us here in Euro-America is not in their interest.
I have a five-year-old in Grade One. The civics assignments she brings home every day from school are a constant source of considerable sadness for me. Assessing how they are shaping her mind, the sort of latitude for critical thought and citizenship sentience they are opening up to her at five is often too much for me to swallow. I wince and gnash my teeth in agony every time because I understand what they are building and preparing her mind for: the 21st-century world of the global knowledge economy and the future after that.
At five, she already owns the global knowledge economy in a philosophized system that is preparing her for competition from Chinese kids and kids from Dubai and Japan in the race for the future.
What they are pouring into this young mind is what will provide the genius and innovation to instrumentalize this 7-point agenda and deploy it for a holistic vision of a society of mutually beneficial commonwealth. The democratization of that commonwealth is at the centre of the philosophy she is being introduced to.
You destroy public education, normalize the concentration of 180 million people's wealth in your minuscule elitist class, groom a vast national confederacy of ignorance to defend the concentration of the commonwealth in your 1% percent rank of political elitism at their own expense, and then turn around to market agendas that can only work on a foundation of massive investment in public education for the next 30 years.
Woin!

Court Orders Police To Produce Evans’ Brother-In-Law

Justice Mohammed Idris of the Federal High Court in Ikoyi, Lagos, has ordered the Nigeria Police Force to produce in court the brother-in-law of billionaire kidnapper, Chukwudumem Onwuamadike, aka Evans, who has been held in detention for four months.
Evans’ brother-in-law, Okwuchukwu Obiechina, has been held in police detention for his alleged involvement with Evans' kidnapping case.
Mr. Obiechina’s lawyer, Olukoya Ogungbeje, said he has been detained by the police since June 2 and prayed the court to order his release from police detention.
The suit, marked FHC/L/CS/1050/20177, has Mr. Obiechina and his wife, Nzube, who is Evans’ sister, as plaintiffs.
They sued the Commissioner of Police in Lagos State, the Nigeria Police Force, and the Special Anti-Robbery Squad of the Lagos State Police Command.
Mr. Ogungbeje, who is also representing Evans, had on Friday appeared before Justice Idris with an ex parte application seeking an order to mandate the police to free Mr. Obiechina.
But rather than granting the ex parte application, Justice Idris directed the lawyer to put the police on notice, with an order that the police must produce Mr. Obiechina before him on October 12 to show cause why the order for his immediate release should not be made.
One Okoliagu Abunike, who deposed a 15-paragraph affidavit in support of the ex parte application, said Mr. Obiechina was arrested by a team of policemen led by two officers, identified only as Phillip and Christian.
Mr. Abunike argued that Mr. Obiechina was arrested and detained solely because of his relationship with Evans, adding that the police officers had been bragging that no court would order the release of Mr. Obiechina.
“Since June 26, 2017, the first applicant is still being detained at the detention cell of the respondents till date, even beyond the constitutionally allowed time by the Constitution of the Federal Republic of Nigeria,” Mr. Abunike said.
“The applicant has not committed any offense known to law to warrant his being arrested and detained by the operatives of the respondents.
“The applicant has not committed any offense known to law that will warrant the infringement of his right to life, personal liberty, fair hearing, freedom of movement and dignity of human person,” he argued.

Kenyan Opposition Leader Withdraws From Presidential Poll

Raila Odinga, the Kenyan opposition leader on Tuesday said he would not stand in a court-ordered re-run of August's presidential election that is scheduled for Oct. 26. Odinga says the polls would not be fair or free.
However, President Uhuru Kenyatta said the election would proceed as planned and he was sure that he would win again, despite his only challenger, Odinga withdrawing. Kenyatta also cited that the majority of his party won in both houses of parliament and among the country’s 47 governors.
“We have no problem going back to elections. We are sure we will get more votes than the last time,” Kenyatta said in the southern town of Voi on local television.
The announcements have prolonged the political uncertainty that has worried citizens and blunted growth in Kenya which is East Africa's biggest economy.
A nationwide protest has been scheduled for Wednesday by Senator James Orengo, who is a key ally of Odinga, raising the potential of violent clashes between police and protesters.
“Tomorrow all over the country there are going to be demonstrations the basis will be no reforms, no elections,” Orengo said.
After the 2007 presidential election, 1,200 people were killed in protests and ethnic violence. However, for now, there is little sign that the demonstrations could boil over into ethnic clashes.
Odinga criticized the Independent Electoral and Boundaries Commission (IEBC), for not replacing some officials, who he believes is responsible for irregularities in the August poll.
“Following the withdrawal of the NASA presidential candidate, the Commission and the legal team are meeting and will communicate way forward,” the IEBC said on Twitter after Odinga spoke.
“There is no intention on the part of the IEBC to undertake any changes to its operations and parts of the personnel to ensure that the illegalities and irregularities that led to the invalidation of 8th of August do not happen again,” Odinga told a news conference in the capital of Nairobi.
“Indications are that elections scheduled for the 26th of August will be worse than the previous one,” he said. “In the interest of the people of Kenya, the region and world at large, we believe that all will be best served by (opposition alliance) NASA vacating the presidential candidature of elections.”
On Sept. 1, the Supreme Court nullified incumbent Kenyatta’s win on Aug. 8 due to procedural irregularities and ordered a new poll pitting Kenyatta against Odinga to be held within 60 days.
Since then, teargas has been used repeatedly by police to disperse small protests by the opposition who demand that the election board changes some officials.
On Tuesday, opposition legislators boycotted the ruling party's session as they were debating proposed amendments to the election laws, which said if a candidate boycotted an election, the remaining candidate automatically wins.
The draft amendments require another reading and a presidential signature before they become law.
Ruling party legislators said that the amendments were designed to head off a constitutional crisis if Odinga pulled out of the election.

Re: Kemi Adeosun’s ‘Deconstructing The Debt Story’ By Oluseun Onigbinde

It is important that public officeholders clarify the issues that citizens are distraught about. One such issue has been the case of rising public debt. Kemi Adeosun's piece comes in the context of the well-rehashed situation that the current administration met upon taking office. With its hail of campaign promises without counting the cost, the Buhari-led government pushed itself into a tyranny of expectations. I guess Nigerian politicians will be more mindful when they make promises, as the campaign pamphlets had programs with at least N19tn yearly to fulfill.
We must also understand that the issue of debt is not treated with consternation, as Kemi Adeosun wrote. It is a right argument that requires our interest in inter-generational equity. If we are amassing the debt that will be a burden on future revenues, it is important to demand more transparency on what exactly we are bequeathing the future and the economic viability of it. Nigeria paid $13bn to settle the Paris Club of creditors mostly tied to frivolous infrastructure that had no economic impact on the current generation.
It must also be said that this administration has not been more transparent than previous governments as regards debt numbers. I reckon that DMO has to be one of the best-managed government institutions with how it maintains an updated register of the national debt. Several officers who worked at state governments where it is nearly impossible to get fiscal numbers and currently at the federal level are surprised at this level of transparency, but we must be vigilant that this not rolled back in a bid to silence varied discussions. Despite the anti-corruption crusade, it has become impossible to get a detailed breakdown of the N1.2tn capital releases as claimed for 2016 budget cycle. Except for NNPC that started its monthly operations and financial reports, this administration has not been more transparent than previous governments, and it needs to sincerely improve this. The Buhari-led government has not provided details of capital releases on the project basis, no bold attempts on open contracting, never applied punitive sanctions to those indicted in Auditor-General reports or any tangible thought on campaign financing, a drain on public resources at all levels. So which improved transparency are we talking about?
Diving into the numbers, the unfortunate thing about the current fiscal management is how it has not shown any belt-tightening approach in the way public officers parade themselves. We don’t know any radical approach to reduce aides of public officers nor has there been any interactive party-level discussions on the National Assembly to rein its cost. In a budget approved during the recession, it is still littered with purchase of cars at N25bn, computer software acquisition at N9bn etc. One would have expected that beyond the serial removal of ghost workers that has not lead to a single prosecution and has always been a public relations stunt for successive governments, the entire Nigerian budgets will solely prioritize not a cluster of administrative capital projects but developmental capital projects with direct impact on the people. The ballpark figure of N1.2tn thrown around has no public details. How can such amount be spent with serial commissioning of projects since the Kaduna-Abuja rail? This means Nigerians are probably not seeing it or certain persons are economical with the truth. Well, I can easily be proven wrong with clear definition of capital projects funded. We continuously hear of the Efficiency Unit as a “placeholder point” but no real understanding of its operations and savings that helped government fulfill regarding bureaucracy.
I am happy that with Kemi Adeosun’s argument, the Federal Government clearly sees where Nigeria’s fiscal problem lies. The critical challenge has always been the size of public revenues, too low for a country of our population and economic size. This is why we must not fetishize our debt-to-GDP numbers currently at 17.1%. That Nigeria has a huge GDP and has not been able to maximize public revenues from it attest to the poor appraisal of the current GDP structure or the approach we have taken that poorly discourage tax payments. From 29% debt-to-revenue ratio in 2014, the Federal Government has moved to 44.7% in 2016. This means that from every 100 Naira that FG receives, it spends 44 Naira on servicing debts. In a recent Pew Research study, it was stated that as at 2015, Brazil spent 42% of its revenue to service debts, being the highest in the world. This shows that while Nigerian debt size might be low, the cost of servicing debt is high among its peers. We must not fall for low debt-to-GDP figures; it is the single incomplete story. Bond interests have not toppled 16% in past year, and the badge that the Nigerian government flashes is that portfolio investors now savor our sweet debt. Who would not with cool interest rates and guaranteed exchange rate exits? The Nigerian government is running a cool social security for the Nigerians who can afford its debt, distorting incentives for the growth of private capital.
It is also unfortunate that FG is also crowding the banks of retail savers launching bond issuance capped at 12-13%. This excludes its Federal Government debt to CBN that has risen from N866bn in February 2015 to N5.189tn as at July 2017. Imagine a scenario at when there are multiple options of bonds and treasury bills at tax and risk-free rates, which bank would borrow to the private sector? In the 2016 Budget Implementation Report by the Budget office, it was stated that “Credit to government grew by 27.44% when compared with the end September 2016 figure of N3.66 trillion….Credit to the private sector (Cp) slumped by 2.93% to ₦21.98 trillion at end-December 2016 from ₦22.65 trillion at end-September 2016 indicating crowding out .”
Think of a country with the debt to the government at a faster pace than credit to the private sector that also needs private capital to reach growth rates of 7% in 2020 as stated in its Economic Recovery and Growth Capital (ERGP). It is also important that government rates have been private lending benchmark in Nigeria now around 25%. With this administration, the only business in town as been government. This administration made a chore out of commissioning private plants but underneath the numbers is a frustrated Nigerian who can’t get capital from the bank because fiscal management have disincentivized this. This is why conversations of debt should not be in size. It is how does FG reduce the cost of borrowing and most especially the domestic offerings that now touches every upper and middle class bracket of the society.
Nigeria’s debt service costs will reach N1.6tn in 2017, closing on its personnel costs of N1.8tn, this is the worry that should be triggering debates on well-structured quantitative easing not government out-borrowing everyone in the space. The current approach of substituting local debt with dollar-denominated debt is also faulty. What should be the purpose of raising external debt? With oil being our main foreign earner at 95% of receipts, is Nigeria not supposed to be borrowing for infrastructure or making investments to correct this imbalance that puts Nigerian currency on a wrong footing every time that oil markets go into a dip?
As stated in the Economic Growth Recovery Plan “Nigeria’s peers raise an average 16 per cent of GDP from non-resource taxes; Nigeria raises just 3 per cent (2015).” The plan also states a target to “increase tax to GDP ratio from the current 6 per cent to 15 per cent during the period.” With a targeted GDP of N137.331tn in 2020, we are talking about tax revenues of N20tn, which is nearly eight times the current total non-oil revenue taxes. This means Nigeria needs to at least multiply its taxes eight times to meet the 2020 target. Despite the efforts shown by Kemi Adeosun in the piece, it shows that it will always be inadequate without a proper reflection on why do we have a huge GDP but little taxes? What is the structure of the GDP that makes it impossible to collect taxes? Has the Nigerian government shown enough faith in the management of public taxes that make it more deserving? These are the conversations that need to be honked because the current approach is a reflection of growth rates in the past and shows that without robust thinking our public revenues will not rise.
I believe the debt debate is rooted in the fact that Nigerian government is taking the escapist approach, racking up debt in quick numbers, rapidly forgetting where before exit of creditors. This escapist approach of taking gradual steps on revenue but giant footsteps on debt is what is being questioned. Nigerian leaders in 18 months have shopped everywhere - AfDB, World Bank, retail savers, bondholders, Eurobond, portfolio investors, Sukuk bonds, treasury bills to pay its own cost. A dive into its budget implementation reports shows that its numbers doesn’t add up such as how did Nigeria finance actual deficit of N1.02tn for 2016 after counting at bond receipts. How is FG also entitled to Paris Club refund and what is the source of the N1.64tn extra-statutory fund provided to states?
In fact, most of the projects tied to these debts especially rail do not have any known economic importance and are not fastened to the idea that such projects should be self-liquidating. They are mainly for political expediency, and this is why this debate is necessary. The Nigerian government should provide effective plumbing in raising revenues, rein on debt service costs with favor for long-term bonds as well as rates that consider private sector lending, evidently reduce overheads and administrative capital items and overall unleash transparency on every issue. Here we see monetary authorities (CBN) limiting liquidity in a bid to keep Naira at a preferred value by mopping up funds in circulation through borrowing, the fiscal authorities (government) keeps feasting on expensive debt while everyone except their bondholders leans through. The Nigerian government needs a lot of rigorous thinking as well as caution.

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