Trending Topics:

Slump in Oil Prices: Can Nigeria Survive The Next Three Months?

The average Nigerian does not know the immense value of crude oil in our national life. Many are ignorant of where government officials fetch the money to fund their extravagant lifestyles; millions of our nationals do not know how the luxurious fleet of cars you find in the convoy of the president, governors and very powerful politicians are purchased. Well, without beating about the bush, the 360 or more 2020 Toyota Camry sedans recently purchased for members of the House of Representatives and the 5 billion naira which the senate voted to acquire exotic SUVs were funded with proceeds from the sale of crude oil. With the commodity selling at a negative value earlier in the week, it would be difficult to fund such extravagancies going forward.

Some persons may scoff at this point and even gave an appreciative nod since the people that would be affected are the very unpopular politicians in Abuja who do not clearly enjoy the goodwill of the masses as we saw in how the social media reacted to news of the death of Abba Kyari, President Muhammadu Buhari’s chief of staff.  A lot of Nigerians have also responded with the “serves them right” refrain after oil prices began to bottom out by mid-February. According to many who hold this attitude of indifference to the horrific decline in oil prices, the new reality will “force us to start thinking outside oil.” Some opined that at least, the number of jets in the presidential fleet would be reduced and the national assembly would cut short its humongous budget.

Many analysts have in fact sold the idea that the decline in oil prices may be a great thing for us as it would reduce the greedy lust for public offices, force governors to put on their smart thinking caps and ultimately initiate series of drastic reforms that would set the country on the path of growth. Some have said that limited finances will compel public officials to appreciate the place of planning in development and for once have the courage to do the right thing.  I agree with all of these but I have a slightly different perspective.

Planning is great, reforms are wonderful, flushing out dead woods from the polity is fantastic and electing a president who would think smarter than Buhari would be a great thing. However, those are long term propositions. The situation at hand is as urgent as it is critical. To remove Buhari, you would have to wait at the very least till 2023. We already have ministers and as we have seen in the last five years, the president has no interest in the evaluation of his staff; he runs with the typical civil service mentality, if you start with him, you are very likely to finish with him so in practical terms, there will be no new ministers until President Buhari is out of power.  These present crop of ministers have little interest in reforms so there will be no reforms to try out until we have a new president who will look to recruit a new set of aides who know what it means to think ahead.

However, the payment of May salary to civil servants, military and paramilitary personnel and purchase of stationeries in the offices will not wait until we elect a new president. The disposal of refuse heaps would have to go on in the cities whether or not we have new ministers.  The hospitals must remain functional no matter who is the senate president. Schools will not close because we still have a certain Femi Gbajabiamilla as speaker of the House of Representatives.

What many do not know is that our over-bloated civil service is funded with crude oil earnings. Many are unaware that it is from crude oil income that we are able to keep those Army and Police trucks fuelled. A lot of people are unaware that the train services many travellers from Abuja to Kaduna and back enjoy is because we can afford to pay from whatever we make from crude oil.

At the moment, it appears that none of these will continue because it is now certain that governments at all levels would earn so little going forward. The biggest victims here will not be those who depend on their salaries to support themselves and their families. The government is the biggest spender in the economy.  It is from government spending that businesses are patronised and money funnelled to the banks. How will businesses make progress when civil servants do not have the money to patronise them? When very little is bought or sold, who will take money to the banks? Remember, most banks in Nigeria run on extensive oil industry patronage.  It is difficult to see how they would function in a COVID-19 induced global recession. Things were hard when oil was selling above $50 per barrel, Nigeria has 100 million extremely poor people, the global headquarters of “mega poverty.” What will happen when the government cannot even pay salaries at all levels? Are you getting the picture?

What can we do? Well in all honesty, I cannot say with certainty how we can avert what is coming.  What I can however suggest is that officials must realise that apocalypse is near and change their ways quickly. How can this be done?

Let’s go…

Pay only sitting allowance to members of NASS and divert the remaining income to payment of salaries. Pour money into food production to prevent the looming starvation. Government should offer relevant support to every value chain in the agricultural ecosystem.

All the jets in the presidential fleet should be sold off immediately. Right now, the president can do without a jet. Several presidents across the world travel in commercial or chartered flights. Citizens of many of those countries enjoy a higher standard of living than what we have in Nigeria. In addition to selling off the presidential jets, one would also recommend cutting down of the number of cars in the convoy of every VIP who is a public official by 80%. We cannot to be wasting money servicing such luxuries at the moment.

How about the spurious item called security votes for governors and senior officials? There need not be any argument about this; it has to be cut out completely. The country cannot afford it now.

In a recent broadcast by the CEO of Roots TV, Dumebi Kachikwu, he warned against embarking on bogus, capital intensive projects such as railway construction or the expansion of airport runways. I support the idea wholeheartedly, right now; we can do without new runways. What is most important to the citizens at this point is food and survival. Careless spending on security must also be stopped. The army must seek creative collaborations in its war against terrorist Boko Haram members. The days of suspicious spending or using the war against terror as a pretext to loot the national treasury are over.

The bottomline is that it would take series of drastic actions for Nigeria to survive the next few months.  Things won’t be the same, ever again. As a bonus, Nigerians need to have an honest conversation with Muhammadu Buhari: can this president really lead us through this crisis? What happens if he can’t? Perhaps he should be told that we appreciate his services and wish him well in his future endeavours; just the kind of thing your HR officer would tell you before handing you that envelope no one likes to receive.