Here We Go Again

It is a burden to discuss Nigeria when its future looks depressingly like a repeat of its past. When lessons that should have been learned 33 years ago remain unlearned. When rank and file Nigerians still expect a “miracle” like they did in the past. When the messiahs of days gone by are expected to perform miracles they failed to perform in the past.

Nigeria has had three general epochs since independence. The first was a diversified economy built on agriculture. The second was an “oil boom” economy, while the third is a post “oil boom” economy. We stubbornly remain in the third epoch, refusing to transition.

The British established an economy based on cash crops. There was Oil Palm in the Eastern Region, Cocoa and Rubber in the West and Groundnuts in the North. It was impossible for all these commodities to fail at the same time. Government had a relatively diverse source of revenues and the diversity of revenues was matched by the diversity in governance: each region was relatively autonomous and had significant freedom to make its own economic decisions.

This governance model of this epoch was not perfect (it wasn’t kind to ethnic minorities), but with a little bit of tweaking, it would have unleashed our innate productive capacity a lot better than the governance model that was soon to follow.

The next epoch was the “oil boom” era. Many commentators tend to focus on Gowon’s “our problem is not money, but how to spend it” as the best description of that era, but leave out the logic that led to the “oil boom era” model of governance.

This era was a product of the Civil War. The people behind this model of governance learned some interesting lessons from the Civil War. The most important lesson they learned was “no Emeka Ojukwus in future”. By this they meant “no sub-national unit will ever again be powerful enough to challenge the Centre”, so they were willing to trade off everything, including economic viability for an all-powerful and domineering Centre.

Fortunately for the advocates of this model of governance, there was a free flow of easy oil money throughout the 1970s. This enabled them to push for even more centralization, more appropriation of the resources of the Niger Delta and the principle of “sharing”, not production as the only true unifying principle of the Nigerian state. With a unitary system and readily available oil money there was very little political incentive for economic diversification, so Nigeria emerged from the 1970s with a less diversified and less responsive economic and governance model than existed in the 1960s.

Nigeria had a hard “reality check” in 1982, the West wasn’t going to sit idly by and have its energy future dictated to it by OPEC. A drive for energy efficiency led to reduced consumer demand, new oil prospects came on board. There was now an over-supply of crude, crude prices began to plummet. Low crude prices meant dwindling federal revenues and an economic disaster. The Nigeria of the “oil boom” was gone, and the third, most enduring epoch; the “post oil boom/structural adjustment epoch” was born.

As far back as 1982, it was clear to most informed observers that Nigeria needed to make fundamental changes. The oil subsidy needed to go, the petroleum sector needed to be deregulated and open for investment, states needed the autonomy to make key economic decisions and the Nigerian Government needed to be less dependent on oil revenues.

Yet 33 years after the rude shock of 1982, Nigeria is nowhere near to having a federal government sustained by diversified sources of revenue. Each constitutional change is even more committed to the principle of sharing and a unitary state than the previous - the 1999 Constitution plumbs depths that were unimaginable even in the 1979 Constitution (written in the heat of the oil boom).

The key question is; “why is this so”? The easy answer is the “corruption, greed and short-sightedness” of the ruling elite. This is partly true, but there is a deeper, more fundamental reason. The problem is generational.

The generation that came of age during the Civil War and emerged victorious will not sacrifice the unitary state they built for anything, not even more diverse sources of Government revenue. They understand that you cannot accomplish economic diversity with very limited political autonomy, but are prepared to live with that, while “nibbling around the edges” – and we have “lived with that” for the past 33 years.

Envisioning a new Nigeria with semi-autonomous sub-national entities and the legal and regulatory framework to achieve economic diversification is a job for another generation.

As long as the “old boys” are still around. It is not going to happen.