Fresh calls for restructuring as COVID-19 batters economy

Some Nigerians yesterday intensified calls for the political and economic restructuring of the country, citing the devastating financial impact of the COVID-19 lockdown
President Muhammadu Buhari during an extraordinary ECOWAS summit on the impact of COVID-19 in the region, via video conference at the State House, Abuja…yesterday.

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Ohanaeze, PANDEF, others demand economic diversification
• Analysts urge salary cuts, trimming of bloated budgets

Some Nigerians yesterday intensified calls for the political and economic restructuring of the country, citing the devastating financial impact of the COVID-19 lockdown and loss of oil earnings due to the crash in oil prices.

President General of Ohanaeze Ndigbo Chief John Nwodo told The Guardian that the country could have escaped the looming economic downturn had its leadership listened to calls for restructuring and economic diversification.
Stressing that the solution lies in “a restructured Nigeria that recognises the contributions of various segments,” Nwodo noted: “I have in my speeches emphasised that we will come to this stage, that we are at a
risk in relying on oil as a sole source of revenue for this country. The whole essence of restructuring is to look for alternatives, given our vast resources that remain untapped. But the North had said those of us in the South clamouring for restructuring do not want them to partake in the sharing of oil, that oil is a national asset, and it belongs to them too.”

Secretary-General of the Yoruba Council of Elders (YCE) DrKunle Olajide regretted he had been “hearing of diversification in Nigeria for over 20 years but no active step has been taken in that direction because political leaders have depended heavily on crude oil.”

Calling for the “gradual taking away of federal revenue allocation,” Olajide noted: “There was nothing like that in the First Republic. In the First Republic, it was the federating units exploiting their resources and paying a royalty to the federal government. There was no federal allocation for the regions that would necessitate going to Lagos (the then federal capital) to collect money based on a specific percentage. At a stage, it was 50/50. In other words, the regions had 50 per cent and 50 per cent to be shared. The 50 per cent was divided into two — 20 per cent to the federal government and 30 per cent to be shared among the regions.”
Olajide added: “As a starting point before you can get any meaningful economic diversification, there must be geopolitical restructuring. This geopolitical restructuring must ensure that the powers you have, now, are restored to the states. We have been living a lie. We have got to the critical stage now, the crossroads, where an important decision must be taken,”

There is no “better time but now to commence restructuring of the country,” said President of the Middle Belt Forum (MBF) Dr PoguBitrus. He noted that by this alone could Nigeria emerge stronger prom the pandemic.

Chief Ayo Adebanjo, a chieftain of Yoruba socio-cultural organisation, Afenifere, shared this view. According to him, the pandemic has exposed the weaknesses of Nigeria’s governing structure and the inefficiencies of its elected leaders. “The better time to restructure Nigeria is now. Any time wasted further would plunge the nation into chaos,” he warned.

Mr. Tony Uranta, Executive Secretary, Nigerian National Summit Group (NNSG), said: “For Nigeria to survive as a sustainably peaceful union premised on justice, equity and fair play, she must be urgently reconfigured to allow resource centres benefit first from their own resources.”
Justifying his submission, he said: “Nigerians witnessed, with unbelieving shock, how stimulus packages were shared out primarily to the Northern states, using money generated in the main from Southern states, without any going to the states where the majority of the said funds were generated.”

Putting the fall in oil prices into perspective, Prof. Adeola Adenikinju said the current situation is an opportunity for oil firms to drastically cut down costs and drive up productivity.

The director, Centre for Petroleum and Energy Economics, University of Ibadan, said: “I am aware that most oil companies are negotiating with their suppliers and contractors to reduce costs by as much as 50 per cent. They have to look at their entire value chain and see where savings can be made. It is not a time for bloated costs. Emphasis must be on how to aggressively drive down costs and boost productivity.”

He noted further that there is no need for oil producers in the country to embark on new capital investments or projects but rather consolidate on existing ones.

Also, former President of Nigerian Association for Energy Economists (NAEE) Prof. Wumi Iledare noted that in the short-run oil price might continue to fall until it begins to rise when inventory is depleted or nearly so.
Insisting that hope depends on whether OPEC + reduces production dramatically, Iledare said there is nothing the government can do other than revise its budget and prioritise actual spending to stimulate the economy.

“I may actually suggest revisiting the salary structure of some agencies and trimming down employment in wasteful areas. Government might also look at unsustainable budget items and bloated overhead,” he added.

Still on oil, Ken Robinson, Publicity Secretary of Pan Niger Delta Forum (PANDEF), noted that the drastic drop in price would test the capacity of Nigerian leaders to take right actions and ensure people do not suffer the effect.

He advised: “The challenge facing the leadership of Nigeria is to look inwards and see how we can maximise the abundance of resources that God has blessed us with. It is not just crude oil. We have other mineral resources that God has blessed us with, that we are not exploiting and are wasting.

“People are just exploiting them in the Northern part of the country. Government is aware but is not doing anything. We are just focused on oil. Even the oil, we are not exploiting it maximally and utilising it for the good of Nigerians. With a population of over 200 million we can well take care of ourselves and won’t even feel the impact, even if oil drops to a dollar.”
The country is “in for our worst recession in history. Unfortunately, we are not ready to confront it or we lack the capability to confront it,” warned Dino Melaye, a member of the Eighth Senate.

According to him, “The situation would be outrageously calamitous. We have not saved for the rainy day. We have no economic and political prowess to tackle the political and economic tsunami that is looming.”

Unlike other analysts, however, Melaye proffered a divine cure. “The solution is for the president and other leaders to do restitution to God. He (President Buhari) should declare a national day of prayer and call on the mercy of God because the negatives, ineptitude, mal-administration in this government are beyond amelioration. And when you find yourself in a catastrophe, the only solution is God.”

On his part, a business mogul and Calabar-based philanthropist, Mr. Ben Akak, said: “It is very important, at this point, that we begin to think of restructuring our political-economic strategy, given the collapse in oil prices as a result of the coronavirus.

“We cannot use the same system and expect the same result. It is important we restructure our economic policies and economic data. I believe that while maintaining the federating units and possibly strengthening them, there must be an element of decentralisation of the economy so that the states could begin to be very active.”

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