Saturday, May 14, 2016

A good thing happened

The federal government announced an end to the fuel subsidies, and thus changed the official price of petrol price from N86.50 to N145 (maximum?) per litre.  Some, NOT all, people are happy with this price increase.
We may face strikes in the coming week in protest of the new price regime.
But considering that for months Nigerian consumers have been paying more than N150/liter in painful conditions for the same, we might as well call the price what it is and hope for progress.

How badly are we doing at the pump?
The price of crude oil crashed - worldwide - in 2014, leading to lower pump prices in Kenya, cheap gasoline in the USA, - both countries now have about 30% lower petrol prices than in late 2014 as logic may predict, ... but in Nigeria, we see the opposite effect: prices have gone up 50% ...
2011 - 2016 price charts for crude oil - oil-price.net
On the other hand, Saudi raised its super-low pump price about 50% too, and we Nigerians don't pay more for fuel than the typical (non-oil-rich) country.   

Criticism of the latest petrol (PMS) subsidy-removal policy -
1. Inflation and hardship, but we've seen the worst of those anyway
2. Low local refining capacity means we still import fuel with basically the little money we've got from exporting crude oil and will remain poor unless we change things.
On the other hand, some would argue that
3. We should have done this a long time ago. 

The federal government should now end the currency subsidy.  The dollar is priced at about 350 Naira, even if the official rate remains under N200. 

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Wednesday, May 11, 2016

Corruption corrupts, and absolute corruption ... ?

(Source)
Corruption is universal, and Nigeria is a country universally acclaimed for corruption. In spite of all the rules and laws prohibiting corrupt practices, [corruption] continues to thrive under weak legal, political and administrative institutions; thereby exerting its penetrating influence on ordinary Nigerians who are trapped in a moral maze as they attempt to conduct their businesses. These Nigerians live their lives with all honesty and integrity, but are too often compelled to conform or be crushed.
Lara Popoola
Lara Popoola, Nigerian lawyer
In light of the deteriorating state of common affairs, it is only appropriate that I should note the deep chasm of distrust and rising cynicism of many Nigerians, about the credibility of the President’s recent anti-corruption battle against some senior government officials and their associates accused of misappropriating public funds. A corruption battle which has been highly speculative and seriously debilitated, by a legal justice system that is lethargic, fundamentally flawed and unfit for purpose.

While I strongly affirm the absolute necessity to prosecute and penalise these “giants” of corruption, I am also mindful of the fact that the government is just one of two hands that claps to the beat of corruption. Hence, we must also address the contribution and mindset of individuals to the existence of corruption in Nigeria, if we are going to wage a successful war against it. The customary condemnation of government and public officials for corruption often authorises many Nigerians to assume the position of spectators and commentators, thereby mitigating their individual participation. They remain oblivious of the fact that corruption does not discriminate.
 Rather, it acquaints itself with people of all social pedigrees, ages, tribes, gender and political parties. It has no regard for level of education or even religious affiliations; for we know many have audaciously testified about the supposed ‘blessings’ of their ill-gotten gains. It is no wonder, that as Nigeria continues to pay its legislators high salaries and stupendous allowances while majority of the population lives in abject poverty and darkness. There is an increased pressure on people to become wealthy in order to alleviate their poverty.

Consequently, the courage to adhere to high standards of propriety erodes away and morality declines as individuals ask “why should I be the sole custodian of honesty and integrity?” After all, an employee who is not earning a living wage and is owed accrued salaries, without the assurance that he will have a job tomorrow, might choose to supplement his income with bribes and other corrupt means.

It is worth noting, that it is not just the man who receives the bribe that is corrupt, but also the man who offers it. Corruptive norms are so widespread, it is sometimes inconceivable for many to comprehend how employing families and friends of the boss rather than the best candidates for jobs perpetuates corruption. Or “rubbing hands” with custom officials to allow the importation and exportation of banned items; or parents using unorthodox means to ensure the admission of their children to higher institutions; or assuming it is acceptable to be dishonest in business dealings just because “that is how it is done here”.

It is because of this prevailing warped mentality, that individuals must not undermine their susceptibility to corruption, for at various stages of life, one might be compelled to confess “I was corrupt”, “I am corrupt” or “I will be corrupt”. This is simply because corruption corrupts.

It is relentless and progressive in its efforts. There was once a time when corruption and development co-existed on a tolerable scale, and Nigeria was able to reap immediate benefits from its natural resources. Unfortunately, this is no longer the case. The adverse impact of corruption on public and private life is obvious and the country is confronted with a vicious cycle of lower investment and growth, higher poverty and inequality, greater fiscal imbalance, and weaker delivery of basic public services. How else does one rationalise the 5th largest provider of crude oil in the world experiencing chronic fuel shortages?

In echo of the President, to conclude that if Nigeria does not kill corruption, corruption will kill Nigeria, is as certain as the theorems of Pythagoras. It will continue to claim thousands of lives on poorly constructed roads, many more will lose their lives in hospitals because of inadequate healthcare facilities. The dreams of many young people will die because money meant for better educational system has been diverted into private pockets and many senior citizens will continue to suffer as they struggle to receive their pensions. Finally, hope will perish when poverty gains a stronghold and misery is intensified.

This is not an attempt to indict every Nigerian of corruption – that would be an unwarranted blanket criminalisation. Rather, my aim is to intrude the thoughts of individuals who unconsciously or through blissful ignorance live their lives without considering their responsibility for corruption and its powerful influence on their day to day living, with the hope to reform our approach to citizenship by asking “how corrupt am I?” and then proceed to actively challenge questionable norms that are detrimental to our development as a nation.

The writer of the above piece, Lara Popoola, is a Contracts Negotiator with a degree in Law and Masters in Financial Regulations and Compliance. She enjoys reading and keeping up to date with political and social issues in Nigeria.

Source:  Question For Every Nigerian… “How Corrupt Am I?”, published April 2016 on Bellanaija.com . As is often true of blog articles, the comments / reactions are varied and very interesting, for instance:
  • This is thought provoking Lara crofty.
    However, Our institutions and its machinery has been rigged to encourage furtherance of corrupt practices in the country. For example, I have being a victim of incomplete car registration. All the papers are well documented, but were not fully updated into their system (as i later found out). Hence on a particular instance, i was forced to part with N20,000.00 or loose my car to a set of Custom officer whose jurisdiction, or office is not known.
    In such a case, if you stick to the law, honesty and due process, the unmarked car(without engraving of any kind) would have been stolen by the self-same people expected to protect it. or what do you reckon?

  • This was well written – in a very lawyer-ly way. I think when we want to ask this question, we need to break it down as much as possible...For many of us, paying N1000 to jump fuel queues is being smart, not bribery or corruption.
    Getting your family member that job that (s)he isn’t qualified for is reducing unemployment, not nepotism or corruption.
    Looking the other way while your line manager keeps N30 million out of a pool of N60 million meant as bonus for the entire team is doing “oga things” and God will take us there someday, not corruption or malpractice.
    The LAMATA bus guys who overload buses and collect cash instead of selling you tickets is him “eating where he works” not corruption.
    Senators asking you why should they take Coaster buses in lieu of going to the same place in a convoy of 20 cars is met with “God will help us” instead of the due outrage.
    Housing “Agents” and court and registry officials collecting money they cannot issue receipts for is not seen as corruption.
    How much did you pay for your drivers’ license? I bet not the normal price.
    Is purchase of black market petrol legal?
    How much did you pay for your passport?
    How much did you pay for your PHCN meter?   All this is to say….everything is warped. Institutions and even the simplest processes are so tainted by corruption, and nothing is done by the rule book anymore. Is it possible to go back to when things were as they should be? Or should we work towards creating a new normal?
Meanwhile, Nigerians are not happy about David Cameron's recent "fantastically corrupt" comment.  Maybe we can change things?  


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Sunday, April 17, 2016

Nigerians confused about Buharinomics should study Islamic principles.

Western finance is Haram.

Wikipedia: Islamic economics
The central features of an Islamic economy are often summarized as: (1) the "behavioral norms and moral foundations" derived from the Quran and Sunnah; (2) collection of Zakat and other Islamic taxes, (3) prohibition of interest (riba) charged on loans.
Advocates of Islamic economics generally describe it as neither socialist nor capitalist, but as a "third way", an ideal mean with none of the drawbacks of the other two systems.
Among the claims made for an Islamic economic system by Islamic activists and revivalists are that the gap between the rich and the poor will be reduced and prosperity enhanced by such means as the discouraging of the hoarding of wealth, taxing wealth (through zakat) but not trade, exposing lenders to risk through Profit sharing and venture capital, discouraging of hoarding of food for speculation, and other sinful activities such as unlawful confiscation of land.
Does this help you understand the President's constraints better? For instance, no loan deal, but investment deals and currency swaps are good. China yes but IMF no.  You're welcome.  Please leave a donation.

Meanwhile,
a few ridiculous faithful people have been about the internet explaining the President's economic moves, plans, strategies...

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