President Muhammadu Buhari was in faraway London to attend an Anti-Corruption Summit when the British Prime Minister, David Cameron, made a statement that Nigeria and Afghanistan were “possibly the two most corrupt countries in the world”. The statement which was not given to the press, but made in passing, somehow found its way into the media and made big headlines back home in Nigeria. As usual it took different interpretations.
For several hours, the unfortunate statement trended on social media and as usual, there was no response from the president until I saw the full video of the incident. The prime minister truly made the statement but was put immediately in order by the Archbishop of Canterbury who said (about President Buhari): “But this particular president is not corrupt… he is trying very hard…” Let us not go further into the politics of it, but one thing I like most about the whole matter is the president’s maturity in responding to Cameron’s comment that he had no use of anyone’s apologies on the incident, but for a refund of assets ‘stolen’ from Nigeria now hidden in Western countries. I agree with Buhari on this one and others previously.
As if the drama was a ploy to distract Nigerians from what was to happen at home, the Minister of State for Petroleum, Dr Ibe Kachikwu, while his boss was attending the London conference, was busy doing his utmost to convince Nigerians of their new reality which is that they will now officially purchase PMS or petrol at N145 per litre.
As expected, the announcement was greeted with rude shock. On being told of the new price regime, I began calculating my daily expenses which are sure to increase as a result of the new price of the product.
Let us get some clarifications before we continue. First, the government’s new policy is nothing new really. Some have blindly called it subsidy removal. They told us in the peak of their passion that the subsidy regime was no longer sustainable, hence the need to remove it.
Secondly, there was never any subsidy in the first instance so there was nothing to be removed. What just happened with the announcement last Wednesday was just fuel price hike and not subsidy removal.
The Vice President, Professor Yemi Osinbajo, in a desperate attempt to defend the new policy, said the present administration has not removed subsidy. In his own words writing under the title: The Fuel Pricing Debate: Our Story, he writes, “…the real issue is not a removal of subsidy. At $40 a barrel there isn’t much of a subsidy to remove.” Again, even if the vice president has come out to say that “there isn’t much subsidy to remove” some of us still have the suspicion as to whether the so-called subsidy is not just another way some persons are cutting their own portion of the national cake.
This leads me to my second point: what really does deregulation mean? If my understanding of the word is still relevant, my commonsense understanding of the term simply means reduction or elimination of government control or regulation in a particular industry, usually enacted to create more competition within the industry. If then it is true that government is deregulating the downstream sector of the economy, we then expect that bodies like the Petroleum Products Prices Regulatory Agency, PPPRA, and related bodies, whose existence have become redundant would have been abolished by now. The fact that the same body, PPPRA, fixed the price at N145 per liter of petrol tells me a lot about the so-called deregulation that the government is pursuing.
Some of the arguments that governments over the years have made in support of deregulation and subsidy removal are just laughable. On one hand, the government will blame shylock businessmen and vested interests as the reasons why refineries cannot work. They will tell us that only privately-owned refineries can solve the problem in the oil sector. On another hand, former Minister of Information, Labaran Maku, said government has been an ‘irresponsible’ businessman, that it has no ‘business in business’. Since government has no ‘business in business’, the economic royalists (as Franklin Roosevelt once called them) should do business at the state’s expense. The only thing left to be said is for the same government to come out to tell us something like: “Fellow Nigerians, the crisis in the oil industry is really not our fault. It is also not the fault of the independent and major marketers. The problem is that as a government were are irresponsible, clueless and reckless. As a result of these characteristics of ours, we are hereby surrendering our responsibilities to the royalists of the economic order to build and maintain refineries.” Though they have not been making frank statements, this is what the defense of their inability to build and maintain refineries look like.
Since 2003, it appears the government has not had a new argument save the same quotidian arguments in their rabid defence of failing policies like deregulation. The fact that at one point, the Obasanjo administration justified the increase in pump price of petrol with the increase in international oil price, how then does one explain an increase in oil price at a time when the international oil price is at all-time low? To this, they brought a third force into the equation-the high foreign exchange rate.
In the light of this, some other experts asserted that the latter consequences of deregulation are: elimination of small companies, elimination of convenience and comfort, reduced wages, laying-off of workers and reduction of environmental safeguards and others.
These consequences are inevitable in a country like Nigeria where the economy is not as strong as the developed world, where corruption is high and there is relatively no freedom of information. Since this administration wants to apply certain regulation(s) similar to what is obtainable in developed countries, what is wrong if Nigerians ask for a similar standard of living, effective refineries, elimination of corruption, constant supply of petroleum products and electricity?
What is playing out in the oil sector with the recent policy statement from the government is nothing but bold-faced corruption and first-rate irresponsibility. Even if we are told to trust and support Buhari for his honesty and anti-corruption stance, we cannot trust that he will be Nigeria’s president forever. On this issue of subsidy removal, deregulation or fuel price hike, I beg to disagree.
Adigun is a political risk analyst and independent political strategist