Featured, Politics
KINGSLEY Chiedu Moghalu, 57, former deputy governor of the Central Bank of Nigeria, CBN, is also a political economist, lawyer, former United Nations official, and professor of International Business and public policy at the Tufts University Fletcher School of Law and Diplomacy.
Moghalu, the founder of Sogato Strategies, LLC, and a senior adviser of the Official Monetary and Financial Institutions Forum in 2016, also established the Institute for Governance and Economic Transformation. A presidential candidate in Nigeria on the platform of Young Progressive Party, YPP, in 2019, Moghalu made time out of his busy schedule to grant interview to Realnews through a questionnaire.
He speaks on the state of the nation, his fears about the 2021 budget, why Naira should be floated; how government can deal with the four ailing refineries; curbing insurgency; why he is not certain the downstream sector of the oil industry has been deregulated; what the new leadership of Ohanaeze can do to unite all the factions; the necessary first step to fixing poverty in the North, solutions to incessant strike by the Academic Staff Union of Universities, ASUU, among other topical issues that challenge governance in the country.
Moghalu, author of several books, including Emerging Africa: How the Global Economy’s Last Frontier’ Can Proper and Matter and Global Justice: The Politics of War Crimes Trials, also revealed his plans for the 2023 presidential race. The interview is crispy, elucidating and a must read for all who want Nigeria to progress. Excerpts.
Realnews: Nigeria is in a state of coma. Some school of thoughts also describe the country as a failed State. Do you agree and why?
Moghalu: I think it is more accurate to say that Nigeria is a failing state, most certainly a fragile state. Many of the characteristics of a fragile state have existed for a long time, such as weak state capacity, loss of legitimacy in the eyes of many of its citizens, corruption, and weak control over portions of its territory that are dominated by terrorists and bandits. If this trajectory continues and is not reversed, the future is not a handsome one.
Realnews: Recently, Nigeria was described as the most terrorised country in Africa. Is this not an exaggeration when compared to what is happening in Somalia or South Sudan?
Moghalu: When you consider the activities of Boko Haram, killer herdsmen and bandits in parts of the country, our country is certainly heavily terrorized, but there are other aspects in which countries like Somalia are worse off because central authority has been contested for years, and there is very little economy to speak of. The very fact of Nigeria being discussed in this context along with countries like this is itself strong evidence that we are a distressed and fragile state.
Realnews: What can the government do to end insurgency and curb banditry and other criminal activities in the country?
Moghalu: The national security apparatus needs to be revamped and monitored for corruption, and completely retrained by an external professional army. Transparency needs to be improved in the funding and spending of the armed forces. We need to go beyond military approaches to improve human intelligence and civilian-military relations. Policing must be made more local through constitutional devolution of responsibility.
Realnews: Is Nigerian economy being well managed? How? and What can be done to improve it?
Moghalu: The Nigerian economy is obviously not well managed. The best way to improve it is a constitutional restructuring back to real federalism. That will create an incentive for wealth creation. With the current structure, the only incentive is one for “sharing” a cake that is not baked properly, and for rent-seeking and arbitrage. The state is trying to play too large a role in the economy without the capacity to do so, and I believe the economy needs clear philosophical direction and intellectually sophisticated management.
Realnews: What do you make of the 2021 Budget which has just been passed? What impact will it have on the state of the economy?
Moghalu: More of the same. No real change from what we know because it has a high deficit which will be funded by borrowing, and it is anchored on the price of oil which is volatile.
Realnews: The Budget 2021 slated N500 billion for procurement of vaccine for 103 million Nigerians which will be given free of charge. What is wrong with this move? Shouldn’t such money be pumped into Nigerian Pharmaceutical companies to get them produce the vaccine locally?
Moghalu: The government should certainly procure Covid-19 vaccines for its citizens, but a country like Nigeria, if we’re truly well governed, should have developed its own vaccines for the pandemic. The intellectual capacity for that exists, but the necessary enabling environment does not.
Realnews: Does it make economic sense for the government to borrow N850 billion from unclaimed dividend and dormant account? What exactly is wrong with this move of government?
Moghalu: No it doesn’t make much sense to me. It indicates fiscal desperation and I think it possibly violates property rights in the Constitution.
Realnews: The Naira has been depreciating against the dollar. What can be done to stabilise it? Should the Central Bank devalue the Naira and what effect will it have on the economy?
Moghalu: I have often said that given the situation in the global economy over the past five years, especially the depressed prices of crude oil, and when we look at future trends, the naira should be floated to have a flexible exchange rate. But devaluation is not enough. Without fixing trade policy to take advantage of naira devaluation to encourage exports and protect infant local industries with tariff policy as opposed to “bans” that only breed smuggling, devaluations only import inflation because we are still an import economy. So the whole structure needs to be realigned with the right incentives.
Realnews: Smugglers are still flooding the country with imported rice despite government ban. Is this policy not defective? How is this affecting local production of rice?
Moghalu: From my answer to your previous question, you can see that this policy approach is defective. Economic activities don’t respond to commands. They are driven by the logic of human behaviour and the laws of demand and supply.
Realnews: The four refineries in the country are not functional. What should the government do about it given that the Dangote refinery is billed to come on stream soon?
Moghalu: I think the government should concession them through a PPP arrangement or sell them.
Realnews: Has Nigeria finally deregulated the downstream sector of the oil and gas industry? If not, what should be done?
Moghalu: We are not certain, given the policy flip-flops we have seen, that Nigeria has finally deregulated the downstream sector. I have heard talk of the reintroduction of petrol subsidy as oil prices inch upwards. Although this is a very difficult time because of the impact of Covid on the economy, the downstream sector should have been deregulated years ago.
Realnews: How do you see the price of crude oil and how will it affect the implementation of the budget 2021?
Moghalu: The price of crude oil will be affected by the Covid pandemic and the OPEC production cuts, so the budget performance will be weak. Remember that the original benchmark for oil in the 2020 budget was around $57, but it had to come down to around $28 eventually. Between oil price volatility and OPEC production cuts in response to weak oil demand because of Covid-induced depression of industrial activity around the world, the budget is unlikely to perform well because it is based on a fundamentally weak foundation.
Realnews: What can the country’s economic managers do to enable it exit recession soonest?
Moghalu: Stimulus spending is the obvious path, but unfortunately Nigeria has been fiscally weakened by reliance on unstable oil revenues, no real savings for the rainy day (today!), and lack of political will to cut the bloated costs of governance.
Realnews: What is your assessment of the current political climate in the country?
Moghalu: It’s fragile because of the state of the economy and insecurity. Nigerians are simply tired of incompetent governance. But we have to see if their tiredness will push them in a new direction away from the status quo. The youth of our country, who make up a majority of the population, deserve something better.
Realnews: What is your assessment of the current political climate in the country?
It’s fragile because of the state of the economy and insecurity. Nigerians are simply tired of incompetent governance. But we have to see if their tiredness will push them in a new direction away from the status quo. The youth of our country, who make up a majority of the population, deserve something better.
Realnews: Are you going to contest the presidential election in 2023 and under which party?
Moghalu: I am thinking about it and doing necessary consultations, and will announce my final decision at an appropriate time. At this time, I don’t belong to any political party, but if I am going to contest then obviously, I will review the terrain and make a choice.
Realnews: What lessons have you learnt from your previous attempt to contest the presidential election?
Moghalu: The chief lesson was that it was a worthwhile effort. We made a strong impact and changed the narrative. I have no regrets, even though we did not win at the ballot box then. But in politics, there are many kinds of victories. Some are strategic, and we see their fruits further down the line. I also saw the difference between structures that win elections but can’t govern, and the need for better voter education and electoral reforms.
Realnews: Controversy trailed the just concluded election of the President General of Ohanaeze. How do you see the new leadership of Ohanaeze?
Moghalu: I have congratulated Professor George Obiozor on his election as the President-General of Ohanaeze. He is an experienced hand who should be able to do well given his experience and pedigree, nationally and globally. I hope those that are aggrieved can bury the hatchet.
Realnews: How can the new leadership unite all the factions of Ohanaeze so there can be one forceful voice speaking for the Igbo?
Moghalu: Well, that’s the challenge facing the new leadership. It calls for reaching out and for dialogue, and perhaps to take a close look at whether there is need for any reform inside the structures and laws of Ohanaeze itself.
Realnews: What role can the Ohanaeze play to ensure that major political parties in the country field in only candidates from South east for the presidential election in 2023?
Moghalu: I think their role is one of advocacy and lobbying, and it should not be limited to “major” parties. A party may be “major” today, but who knows tomorrow? Our recent political history should advise us to move away from this focus on “major” parties and look for competent leadership and governance. That’s very different from success in the transactional politics that has fostered poverty and corruption in Nigeria.
Realnews: How can the North reform the Almajiri phenomenon that is dragging development back in the country, especially with so many little children out of school?
Moghalu: The lmajiri children need to be given education with skills that can make them productive. This requires strong political will by the northern religious clerics, traditional rulers, and the state governments in that part of the country. We all need to realize that quality education and school enrollment is the necessary first step to fixing poverty in northern Nigeria.
Realnews: Is there a solution to the incessant ASUU Strike in the country and how can the standard of education be improved upon to catch up with developed world?
Moghalu: There are solutions. Our universities need to be more autonomous. There is no advanced country where universities do not enjoy a high degree of autonomy. Second, the government needs to respect agreements they reached with ASUU decades ago about funding the universities. We need to improve education standards with robust reforms that include a far greater share of budgetary allocations to education for teacher re-training, curriculum improvement towards vocational skills, technology and entrepreneurship, improving the learning environment and infrastructure. We also need a much stronger regulation of the education sector to make sure educational institutions comply with minimum standards.
Realnews: The United States presidential election has been tumultuous. What is the implication for the world and Africa in particular?
Moghalu: The presidential elections in America and the aftermath shows us clearly that elections have consequences. Voters should be very careful about who they elect as leaders, and we should be very cautious of populist appeals that can bring incompetent people or autocrats into power in a democracy. People forget that Hitler came to power in post-World War I Germany through elections. Second, the whole affair tells us how important it is to build strong institutions. America escaped by a whisker, thank God for its resilient institutions which resisted a flawed, but powerful man with presidential powers.
Realnews: What would be your advice to Nigerians in this New Year and beyond?
Moghalu: Happy New Year! Let us remain strong and determined to take our destiny in our hands and turn Nigeria around to make real progress. Nigerians are God’s children too, and we deserve a place in the sun.
– Jan. 19, 2021 @ 15:53 GMT |
Tags: Exclusive: Kingsley Moghalu's revelations on state of the nation
