…the biggest question will remain, nonetheless, whether anyone believes that the boost to the domestic economy’s earnings potential from the incumbent administration’s debt splurge will be enough to meet our future debt service costs. I have my doubts!


As 2019 draws to the end, the one claim we cannot continue to cling to is that Nigeria is working. It doesn’t matter which aspect of our lives we look at, the evidence is of worsening conditions. At the economic level, the official numbers are horrible. What passes for the organised private sector is exhausted — contracting household spend, and an uncertain public policy space have driven a decline of investment in new capacities. The public sector is a gag (even though few are laughing) — it no longer does much, and even the little it gets done, it does most wastefully. Not surprisingly, unemployment has become a chronic problem. As have domestic prices, which rose with a vengeance of late — the outcomes of government’s recent decision to shut the country’s land borders have been far from benign all round.

How much of our failing security situation is because a growing number of our youth are not employed, in school, or in training schemes? The jury may remain out on this for a while yet. But you need only drive through or walk down roads in our main cities to understand how serious this problem is, and how both close and precarious the tipping point might be. Our underclass — beggars, windshield washers, able-bodied hawkers of bric-a-bracs — is large and swelling. Yet, at the anecdotal level, tales of the country’s rapid descent from grace to grass are less nightmarish than tear-inducing.

Whichever narrative gets your goat, it should ring alarm bells too as we enter the new year. Those who persist in seeing silver linings in the gathering clouds are wont to argue that if things were so bad, unrest would have long gripped the land. Perhaps. But again, correlation and causation are not necessarily the same thing. Which is why across the debate divide, you hear that about 45 per cent of the economy is unrecorded. So, all that misery is off the half of domestic economic activity that the official bean counters measure. Almost half of the economy, then, is in the shadows, providing work and the means necessary to sustenance to artisans, street hawkers, etc. — that very same underclass, in other words. One convincing argument is that this might be the explanation, the cushion as it were, for why our society hasn’t imploded.

Alive to these costs, even the easiest back-of-the-envelope arithmetic indicates that in order for this economy to break even, the future gains from deploying the infrastructure that we are currently spending money on must exceed both the costs to the economy of our current sufferings, and the putative costs of emplacing the infrastructure.


If true, this aspect of the conversation only makes the matter worse. Over the three decades plus since the first global oil markets-induced recession in this country, the policies of successive governments have not had any bearing on that part of the economy where the sun doesn’t shine. Not only have we not mainstreamed the shadow economy over this period. We have significantly failed to improve productivity there — work tools and practices haven’t changed much in the intervening years. Crucially, over the last five years, we may have worsened what remains of this sector of the economy.

I’m pointed to vast infrastructure work that’s been driven by the Buhari administration; and reminded that there’s no gain without pain. As counterargument, there is much sense in this perspective. All that may be required of us is to bear the current privations for only as long as it takes the infrastructure projects to come on stream. And then, simply by bringing down domestic costs thereafter, we should see boosts to economic activity that reverse today’s less-than-stellar trajectory.

Fair enough, if one can ignore one niggling fact: that there are other costs to the Buhari administration’s infrastructure spending binge. Costs that we will bear tomorrow, in addition to the sufferings that we will carry over from today. Alive to these costs, even the easiest back-of-the-envelope arithmetic indicates that in order for this economy to break even, the future gains from deploying the infrastructure that we are currently spending money on must exceed both the costs to the economy of our current sufferings, and the putative costs of emplacing the infrastructure.

Anyone who looks at the national debt levels now ought to be scared, both by itself, and because this is arguably the biggest cost element imposed on the economy by the Buhari administration. You could have all of the conversation around debt. How debt is not bad in or by itself: What matters is what it is used for.


Do they? Anyone who looks at the national debt levels now ought to be scared, both by itself, and because this is arguably the biggest cost element imposed on the economy by the Buhari administration. You could have all of the conversation around debt. How debt is not bad in or by itself: What matters is what it is used for. How minuscule a proportion of national output our current debt stock is. Why our debt stock matters only because the cost of servicing it is taking up a disproportionately large share of public revenue. You could even join some in worrying over how bigger our debt gets when we include ways and means advances from the central bank, and state-owned enterprises’ borrowings. How dangerously close the national debt is to the point at which the Obasanjo administration agreed debt relief terms with the Paris Club in June 2005.

You could do all of that, and probably more. But the biggest question will remain, nonetheless, whether anyone believes that the boost to the domestic economy’s earnings potential from the incumbent administration’s debt splurge will be enough to meet our future debt service costs. I have my doubts!

Uddin Ifeanyi, journalist manqué and retired civil servant, can be reached @IfeanyiUddin.