Why privatisation of PHCN utilities should not be reversed, by Amadi
THERE is growing concern that ‘hawks’ around President-elect , Muhammadu Buhari may push for power sector reform again. The fears are premised, partly , on the late President Umaru Musa Yar;Adua’s stoppage of the power sector reforms started by is predecessor, Olusegun Obasanjo.
But reacting to such fears , Chairman of the Nigerian Electricity Regulatory Commission (NERC), Dr. Sam Amadi yesterday, dismissed them, stressing that outright reversal of the privatisation would not be in Nigeria’s interest. Amadi, in a statement, harped on the need for continuity of the reforms, stressing that anything to the contrary would create fear and apprehension among investors The NERC chairman who called for the continuation of the reforms, noted:
“The spirit and intent of establishing the Commission remains the implementation of the Electric Power Sector Reform (EPSR) Act 2005. NERC has, in the last four and half years , recorded achievements in the implementation of the power sector reform, especially with regards to the privatization exercise.
“Because of its principled implementation of the reform programme, NERC has received both national and international accolade as one of the major drivers of the power sector reform.”
Amadi said though government has a responsibility to make policies, “We are optimistic that the direction of the new government is clearly premised on privatization and securing the financial viability of the sector as a way of improving power supply by sustaining investment. “For me, privatisation is not the problem.
We are in a new modern economic world where we think about privatisation or public-private-partnership, depending on what you choose to call it and which explains that government may not be the sole producers of public goods and services and in many cases should not produce goods and services directly. “But there are still residues of socialist economic thinking where some people think that government should still be in-charge of producing public goods and services .”
The statement which said the Commission does not entertain any fear that the Buhari-led government would reverse privatization or that privatization could be reversed also spoke of NERC’s “unwavering commitment” to the on-going privatisation of the power sector and reassured investors, both within and outside the country, of the regulator’s commitment to drive the reform process to a conclusive end.
In a related development, Chairman of the Society of Exploration Geophysicists (SEG) Nigeria, Prof Charles Ofoegbu has canvassed the need for a review to make the transaction better tuned to solving Nigeria’s power-sector problems.
He rejected calls for outright cancellation. Ofoegbu in an interview, also wants the incoming government to review Nigeria’s gas export agreements with some of her neighbours, noting that the agreements in their current state, do not seem to have taken care of Nigeria’s domestic gas needs .
The former Head of Exploration Research and Development Division at the Nigerian National Petroleum Corporation (NNPC) was emphatic that privatization had not created the impact for which it was embarked upon. His words: “Privatisation has not solved the problem. It needs to be reviewed.
The process was riddled with mistakes. While some were convenient mistakes Nigeria is known for, others were genuine mistakes. Government has to sit down and ask to what extent privatisation met those core objectives and determine the extent of the review. “If there are areas it has met, they should then determine what they should do in such areas.
They should also check if it has solved our problems and if it has not, they should check if the people that took over are competent to operate them.” Speaking on the task before the incoming government, he continued: “The good thing with change is that it gives an opportunity to look into the past, learn from mistakes and try to effect positive change.
I am sure the incoming government would have noticed the total failure in the power sector. “Instead of moving forward, one is moving backward. Privatisation is a failure.
So it is for the incoming government now to pick up the pieces and try to give the people and the industries light. When you address the issue of power, you may have addressed a lot of aspects of the economy.
Many manufacturing companies collapsed because of power. A lot of businesses folded up because they could not sustain themselves using generator sets. The near skyrocketing prices of products in Nigeria do not encourage local manufacturing while the price of diesel is ever-increasing.”
Amadi’s position was shared by the Vice Chairman of Shiroro Power Plant, Olubunmi Peters, who stressed the need for the incoming government not to tamper with the process. Similarly, the Chief Executive Officer of Ikeja Electricity Distribution Company, Mr Abiodun Ajifowwobaje had at a meeting with NERC on Wednesday stressed the need for continuity. He said: “One of the problems in this country is continuity.
A government will come and see a school that his predecessor is building and decides to start a new one and the other one will become an abandoned project. “In the case of power, it is not what one thinks he can get right in one term of a president. My advice is to look at where we are, what the challenges are and then come up with ideas that could move the power sector forward.”