The story of the sales of assets in Nigeria is replete with the elite’s collective theft of the national patrimony and assets stripping. Selling is a one-off thing without the capacity to regenerate wealth and as such not a solution to a country’s financial problem. With these sales, government wants to “cut its nose to spite its face”…
The Nigerian leadership has once again embarked on a national pastime of walking in the dark in ignominy. The minister of Finance, Zainab Ahmed, recently announced that the government of the day has concluded arrangement to sell some national assets to fund a one-year budget — that of 2021. You would be right to think that disposing of these collectively owned property could fund the nation for at least 10 years and lift us from poverty to prosperity within this period. No, in their reckoning, the generations to come should not have the privilege of inheritance from their forbears, because once upon a time, a recession came and the government had no answer but to resort to selling off what belonged to all, just for a year’s budget.
As illogical as disposing off your property because you are broke is, a whole bunch of government officials could not think outside the box in a time of crisis, except to take an easy route that would further pauperise the nation.
In truth, no one expected the 2021 budget would be an easy ride; definitely not with the COVID-19 pandemic and attendant havoc-like recession and economic downturn, but for an economy already battered by bad government policies, mismanagement of resources and corruption, it is not a surprise that it would be a struggle to implement the 2021 budget. Thus, typical of our government’s inability to fund its profligacy embedded in the budget, it wants to do the unthinkable. Our budgets have always suffered from trust deficit because every year, budgets are never executed, except for the payment of personnel and emoluments, even as it is always over-inflated through padding or the extraneous items smuggled in.
In addition to selling national assets, the Federal Government has also toyed with the idea of borrowing to fund this same budget. I’m not an economist, but I think it is wrong to borrow and spend monies you don’t have, especially with the consumerism and unproductiveness of our populace. According to the minister, the N5.6 trillion gap in the N13.58 trillion budget will be borrowed from the World Bank, the Islamic Development Bank and countries like Brazil, which is a developing country like Nigeria. Yet, Nigerians are still kicking over incessant borrowings without the concomitant development of key infrastructure to at least justify the debt overhang being bequeathed to generations unborn.
Meanwhile, the same 2021 is said to be N505 billion higher than that of 2020. Again, from a lay person’s point of view, it does not make sense to increase a budget in a pandemic and recession year, only for that same country to want to borrow or sell national assets to finance it. Isn’t it safer to work within your limited finance than project high and plunge the nation into more debt traps?
Besides, up till this moment, no one can tell how the proceeds of such sales were ever utilised to help the economy. Nigeria still has housing deficit issues and virtually none of the public sector properties sold did better after their acquisition. Instead, the assets were stripped and the companies rendered comatose, such that today they are shadows of their past.
In a document from the minister, government will sell the integrated power plants in Geregu, Omotosho and Calabar at N434 billion, concession the National Arts Theatre, Tafawa Balewa Square and all the river basins authorities at N836 billion. Also the National Stadium in Lagos, Moshood Abiola Statium, Abuja and two others are to be concessioned for N100 million and all the sales would be through the Bureau of Public Enterprises (BPE), an organ of government that has an unenviable past in this regard, and somehow operates clandestinely, according to the Senate.
Unfortunately, the country has been through this kind of mess before; the only difference is that no lesson was learnt from that time.
Between 2003 and 2007, the Olusegun Obasanjo government, with the current governor of Kaduna State, Nasir El-Rufai at the helms, hurriedly auctioned off some national assets running into billions of naira. Although it is true that those government properties were run down, affording the authorities the alibi to sell them, a serious government would have fixed the associated problems of corruption, mismanagement and the absence of a maintenance culture, than further reducing the assets to liabilities, and diminishing their worth towards onward sale to friends and cronies.
Besides, up till this moment, no one can tell how the proceeds of such sales were ever utilised to help the economy. Nigeria still has housing deficit issues and virtually none of the public sector properties sold did better after their acquisition. Instead, the assets were stripped and the companies rendered comatose, such that today they are shadows of their past. A bad example of how not to sell government property was the disposal of NICON Insurance to a business man, Jimoh Ibrahim. Today, the company is worse off, with its bad shape reflected in the physical dilapidation of the company’s gigantic head office in Abuja. The sale of Daily Times newspaper, which in its hey days had property strewn all over the country, has remained a subject of litigation almost 20 years after, even as its assets have been stripped too. Not to talk of the sale of the Legislative Quarters in Abuja – an action that caused so much uproar but which the subsequent government of Umaru Yar’adua did not have the courage to upturn.
The minister also said the assets earmarked for sale are moribund and their liquidation would boost the nation’s economy without explaining how… even as she had earlier said that the “intention is not just funding the budget, it is to reactivate these assets and hand them over or have them bring contributions to the growth in the economy”.
There is also the nagging issue of borrowing from unclaimed dividends and dormant bank deposits, as if the owners of these accounts, even if dead, do not have relations or traceable addresses. All that is required is for Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE) to do due diligence and contact the families of the depositors. It is not free money lying waste, as the government would have us believe. Instead of utilising it for unproductive ventures, the money could be invested in social services that can bring succour to the needy. Government does not have a good reputation in this respect.
The minister also said the assets earmarked for sale are moribund and their liquidation would boost the nation’s economy without explaining how. “There are some government assets that are dead, that can be sold to the private sector to be reactivated and put to use for the benefit of Nigerians. We are looking at different categories of government assets that government has not been able to manage, and in some cases even completely run down, to cede them off to the private sector”, even as she had earlier said that the “intention is not just funding the budget, it is to reactivate these assets and hand them over or have them bring contributions to the growth in the economy”.
The story of the sales of assets in Nigeria is replete with the elite’s collective theft of the national patrimony and assets stripping. Selling is a one-off thing without the capacity to regenerate wealth and as such not a solution to a country’s financial problem. With these sales, government wants to “cut its nose to spite its face”, in “a needlessly self-destructive over-reaction to a problem”. So, what will happen to the budgets of the coming years, when there will be no property to sell? Such is the reality check government should subject the 2021 budget to, instead of going on a borrowing binge and disposing of what belongs to all to a few acolytes.