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Before We Borrow Again By Chuma Obiora
I was shopping in one of the high streets in England and one man approached me clutching some cards. He offered me credit card to the value of £2,000 (N500, 000) there and then. All I needed to give him was my name and address. My explanation that I already had a couple and my credit needs are fully met, only spurred him the more. He went on on the number of months I may use his own card without interest on my spending and how I can transfer all my credits in other cards to his and the generous and attractive offers that go with such. I stuck to my decision and when he saw the futility of his endeavours, his disappointment was apparent. This is the picture in most developed countries. The so called Western Consumerism is in the main, driven by credit. I may not easily embrace this lifestyle due to my upbringing as a Nigerian where the saving culture holds sway. My generation elsewhere in the developed world have an entirely opposite view of life. An average citizen owes several thousands of pounds. The only obligation is to pay a few pounds to the credit card company at the end of the month and continue living life to the hilt. Some even eventually cannot maintain these small payments while owing several tens of thousands of pounds. They have what is known as Independent Voluntary Arrangement (IVA) in which case the debtor reaches an agreement with his creditors to pay only a fraction of what is owed over an agreed period. He is completely debt-free afterwards. As I said earlier, virtually everyone is in debt and we know as mortals, human beings die. A substantial amount is lost this way as well. These are only personal debts. It is estimated that personal debts in Britain is in the order of trillions of pounds. But the system has not collapsed. If anything, it is growing stronger and people are still being mobbed by credit offers in different forms. There is only one explanation for that: there is a steady stream of funds into the banking system in the western world so much that the banks are ‘swarmed’ with funds. Now, the big question: Where are these funds coming from? It may be wrong to pin down a single source but we know several Nigerian nay African leaders past and present have staggering amounts of stolen cash stashed abroad. I believe these monies at least contribute in part to this seemingly inexhaustible stream of cash. In recent past, we have allegations against Ibori, Alamieyeseigha, Dariye et al in this regard. In fairness to them, the UK police followed each case with enthusiasm but due mostly to lack of political will on the part of our leaders, they all ended in anticlimax.
I recently read from the internet that the Finance Minister, Samshudeen Usman is recommending that we take loans for our developmental needs. I narrated the experience above to put this direction of thinking in perspective. Can we not all say déjà vu? Is he not taking us to the same dark alley we managed to extricate ourselves from (one of the few positives of the Obasanjo years), completely bruised and battered? To be sure, we need all he said and more (more roads, railways, bigger airports, more power generation, water supply, housing etc). The question is, is plunging the nation into another vicious circle of debt the answer? The debts that crippled our nation for so long (we remain crippled) were obtained for exactly the same reasons. It only succeeded in creating multibillionaires out of government officials who in turn smuggled the funds back to banks in the western countries, helping fund their credit lifestyles, bringing our economy to its knees and untold hardship to our people. Our finance minister should know better. It equally does not take much intellect to realise that the profile of our spending for several years vis-à-vis results does not suggest any modicum of prudence. This is hardly a good setting for borrowing. It does not matter whether we borrow from World Bank or Islamic bank; every loan has its conditions which are never in favour of the borrower. President Yar’adua should focus on the creation of a culture of prudence and value for money with our own oil and internally generated revenue. He should equally do all that is needed to repatriate the colossal sums stashed in western banks by our successive leaders, currently funding their easy life. Only when these are successfully done can any loan be justified. We may not therefore have to go through the trauma and shame of seeking debt forgiveness as the loan so obtained will service and repay itself while adding value to our nation. UNITED KINGDOM |