The desperate journey of the naira
It is a noteworthy development that Nigerian workers are contemplating the necessity of asking for a salary review.
The minimum wage remains N18,000.00 per month, which may not be enough to feed a senator’s dog for the same period.
It is true that Senator Shehu Sani some weeks past has revealed to us the best kept secret of the republic: the salary and running cost of each senator which is about N14 million per month.
But what is the take home pay of ministers, governors, commissioners, permanent secretaries, special advisers, special assistants, senior special assistants, executive secretaries, executive chairmen, directors-general, and other special inventions of our democracy?
One great achievement of President Muhammadu Buhari’s government is that it is making Nigerians to fall in love with the naira again.
Leading politicians now spend in naira, not in dollars, and even some top hotels that once expect you to pay in dollars, are now accepting naira.
During the 2015 general elections, a lot of dollars were released to the market to shoot down the naira. When Buhari won, the losing side simply disappeared with their dollars.
Some buried their loots in the cemeteries, some in overhead water tanks, some in soak-away pits and some in the unsafe safes of their mistresses. Some smart ones migrated into the new ruling party and their loots became clean.
The truth is that most politicians hold the naira in contempt. There was a time politicians and all Nigerians were in love with the naira. Everyone wanted the naira, including London shopkeepers who learnt how to speak in smattering Yoruba as they attend to free-spending Nigerian bourgeoisies.
Even the London butchers knew the taste of Nigerian housewives and the preferences of their London palates. Orisirisi wa o! they would chorus once they sighted a Nigerian woman in their iro and buba.
Now the naira is in trouble. Thank God, it has stabilised a little, but it is not yet in robust health.
Nobody expect it to get back to its old stamina soon. If it can maintain its current state of health without dipping into further trouble, that would be enough.
There was a time the naira was the currency of West Africa from Dakar to Duala.
It was much sought after than the dollar. In 1984, workers at the International Institute of Tropical Agriculture, IITA, protested against the continuous payment of their salaries in dollars! They wanted naira!
The IITA authorities fought back, claiming the dollar was their preferred currency. In the end, the Nigerian workers won. They started earning their pay in naira!
The Nigerian currency was strong in its early years. The naira was introduced in 1973 after the Nigerian Civil War. It was to domesticate our currency and free it from the apron-string of the British pound.
It was also to bring all Nigerian currency notes into the banking system instead of being kept under the bed and in cocoa and groundnut bags. So we had the naira and our lives were supposed to get better after.
A significant journey in the life of the naira started in 1974 when a commission set up by the Federal Government under the leadership of Chief Jerome Udoji, submitted its report.
The government of General Yakubu Gowon accepted the recommendation of the Udoji Commission for salary review across the board. Teachers in primary schools who were earning N540 per annum had their salary increased to N1,080 per annum.
The most affected were the university teachers. Professors were now to earn N3,600 per annum. The highest paid public officer was the Chief Justice of Nigeria who was now to earn almost N6000 per annum.
In truth, workers were happy about the Udoji Award. Though Chief Udoji did not recommend the payment of arrears, the Gowon administration decided to pay one year arrears of salary to workers and suddenly our country became awashed with petro-naira. So much money was in the system and everyone was happy. Or almost everyone!
One man who spoke openly against the Udoji Award was Professor Sam Aluko, the famous economist who was a teacher at the then University of Ife (now Obafemi Awolowo University).
He said by increasing salaries across the board, Gowon had taken a wrong decision which impact would be more apparent in the future. He said the 100 percent across-the-board salary increment would only encourage Nigerians to consume more and more.
“As a developing economy, what we need is to produce more and not consume more,” Aluko said. As he predicted, more money in circulation fueled consumption and Nigerians went on a spending binge.
All the electronics in the Lagos market disappeared. Lagosians dumped their bicycles for motorcycles.
Cars and cars appeared to create the now notorious Lagos go-slow. Bicycles were never to dominate the streets again.
Supporters of Gowon argued that more consumption would create more production. Aluko countered that in an economy dependent on foreign goods, the best things to do was to produce more local goods.
“You cannot decree there must be yams when you have not planted yams,” Aluko said.
The way it is going, we may soon be importing yams from China. Thanks to President Buhari, the country that sells us rat-gums is no longer selling us tooth-picks! Since the Udoji Award, we have become the greatest importers of second-hand clothes in the world.
We are the only country of our kind of population that could not keep its tailors employed and where even legislators and governors pride themselves in wearing (first grade) second hand clothes.
Even our most prominent and richest women wear natural hair imported from Brazil and India, presumably scrapped from the scalps of dead women.
Since Aluko’s dire warning, we have learnt the art and science of consumption. We produce little and consume virtually everything. Yesterday, I bought fuel of N7000 into my car.
In the days when the naira was in good health, I bought my first car in 1983, a brand new Volkswagen beetle car for N5,200 only from S.O.S Motors, Isolo, Lagos. There must be very few newly employed young graduates today who can afford a brand new car.
So what has happened to the naira to have lost so much of its powers? So much disrespect has being the lot of the naira that even the looters prefer to loot in dollars and pounds. The truth is that life has changed so much from the time of Gowon when the nation took that fateful turn in 1974 and voted for consumption instead of production.
There are fundamental differences between Gowon era and now. We balance our budget. During the Civil War when the country was in a desperate straight, Nigeria still balanced its budget.
Chief Obafemi Awolowo, the Federal Commissioner (Minister) for Finance in those dark days refused to borrow to finance the war. Instead, he insisted on financial discipline.
Today, borrowing has become fashionable and politicians talk about it like it is a passport to heaven. There is no state today that does not owe more money than the entire country owed in 1975.
The looting point has also expanded geometrically. In those days, Nigeria had only 12 states. Now there are 36. The old Western State presided over in succession by General Adeyinka Adebayo, Brigadier Oluwole Rotimi, Admiral Akin Aduwo and lastly, General David Jemibewon, had only 14 divisions (local governments).
Today, Nigeria has 774 local governments. Ekiti State alone, which was one division (one local government) in the old West, now has 16 local governments.
For the naira to regain its old strength, Nigeria must retrace its steps. We must move away from consumption to production. Let us start from the basics of feeding and clothing ourselves.
A country where majority of its citizens wear rags imported from other countries can hardly be said to be an independent country.
The naira may be in desperate straight, but we need to prove that there is life after death.
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