Of Noisy Authorities And The Inquisition Of Capital

Of Noisy Authorities And The Inquisition Of Capital

Nosa James-Igbinadolor

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way - in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only”.

Scrutinising Charles Dickens’ opening words in his famous fictional novel, A TALE OF TWO CITIES, one is forced to reach a sober conclusion that the wordsmith perhaps had the last two weeks of this country in mind when he put pen to paper one hundred and fifty two years ago. No doubt the Flying Eagles’ has brought some light into this season of darkness especially with its sweet defeat of England, a country that never tires to remind us that they won the World Cup in 1966! Alas what is happening in the economy leaves one incredulous and despairing about our institutions and the noisy authorities that superintend them.

The national dramaturgy that is going on in the National Assembly in the name of probing the activities of the Bureau of Public Enterprises and the furious histrionics that have accompanied the media inspired ‘revelations’ have further confirmed my belief that we are people of theatrics, drama loving but intellectually provincial and emotionally illiterate to appreciate the finer points, the nuances and philosophical underpinnings of the edited telenovelas we so love to watch. What is happening at the senate is no different from the now infamous Eleumelu panel which between 2007 and 2008 was procured to carry out an inquisition of certain persons especially former President Olusegun Obasanjo, only this time however, the Senator Ahmed Lawan led panel will inquisition private capital and entrepreneurship and declare them misfits within the Nigerian political-economy after all the state and the parasitic amoebas who leeched on her for so long cannot easily be dislodged without a fight. The Nigerian legislature has always over-celebrated its perceived powers causing it to stray into areas it has no jurisdiction to trespass into. They believe they have the right to summon anyone they chose to but really they only have such privileges over office holders approved by the legislature.

I was aghast the other day when newspaper headlines blared in varying configurations baseless claims that the Aluminium Smelter Company Ikot Abasi was valued at 3.7billion dollars but sold for 130million dollars thus short-changing the country of over three billion dollars! Of course many went to town lamenting the rip-off of their national ‘heritage’. Not for me!

Who ever did the valuation of ALSCON and reached a value of 3.7billion dollars certainly needs to have his or her academic certifications investigated. Ajaokuta steel which is about two times bigger than Alscon gulped a little over two billion dollars of tax-payers monies that is including for sundry corruption, inflation of contract price and the reality that the cost of building anything in Nigeria by government is more exacting than what obtains anywhere else in the world after all it took Mozambique 120 billion dollars to build a similar plant like Alscon while it took us four hundred billion naira to do same. Alscon couldn’t have been worth half a billion dollars, what with the fact that the company built in 1997 never operated at more than ten per cent of installed capacity at anytime before it was privatised, there were no new investments in the company in terms of modern production capacity throughout its pre-privatisation years and the company never exported one finger of aluminium but rather continued to depend on subventions from government to survive until it grounded completely in the late-1990s. How then could such a dinosaur with its decrepit infrastructure be worth 3.7 billion dollars? How could companies that were either dead or dying suddenly become fast moving consumer goods enterprises, and yet we keep quiet as they lie their way through and misinform the gullible public? Sadly in our desire to feed public thirst for fresh blood we kill peoples’ character, diminish their personalities and destroy their reputations. It happened with Elumelu whose report was rightly thrown into the thrash-can where it belongs and it is happening again. The truth is nothing sensible or useful will come out of this inquisition but a farrago of nonsense! The sad, unusual and strange thing is that the committee members producing and directing these dramatic probes do not seem intelligent enough to question the heavenly claims and asymmetric analysis presented by persons, groups and communities questioning the right of the core investors but are always quick to shout-down and denigrate the investors. This no doubt proves that there is a dubious motive driving the committee and its members.

The inquisition of capital continued when a couple of days ago, the Central Bank finally did what its noisy authority vowed he would never do, they nationalised three banks Governor Lamido Sanusi had forcefully taken over from their shareholders in 2009. The nationalisation of these banks no doubt further accentuates the debilitating state of the Nigerian financial sector which has continued for no just reason to receive killer blows from the incompetently led Central Bank. Since 2009 when the noisy authority at the Central Bank took over, bank equities have continued to fall dramatically and are yet to recover from Lamido Sanusi’ “humanitarian mission”. Jobs continue to be lost with the latest figures pointing to the fact that nearly 8000 jobs have been done away with since Sanusi used his power and might to rip-off shareholders of eight banks of their life’ savings. Shareholders of all banks have seen a large decline in the paper value of their shares, they have also seen dividends cut or stopped, creating the double effect of a capital value reduction and a decline in income as a consequence of Sanusi’ actions. By nationalising the three banks, the CBN has effectively extinguished whatever feeble hopes the shareholders may have believed of ever seeing the value of their investment recover

Yes it is the season for the inquisition of capital; perhaps it is even the season for the inquisition of entrepreneurship, yet those who do incurable damage to the nations’ economy by their actions and inactions must be held to account. In August 2009 while speaking on the cable business network CNBC Africa, Sanusi vowed that none of the eight banks he arm-twisted from their shareholders would be nationalised. He reiterated this stance again at a gathering in London where he assured that it was not the intention of the CBN to nationalise the “problem banks”. The monies injected by the CBN into the banks, according to Sanusi “would permit them to continue as going concerns under their new management, who all have private sector backgrounds. The immediate priority will be the recovery of non-performing loans”. Sanusi also added at that gathering that "The capital injection is in the form of a five-seven year convertible. The CBN would like to see further private sector capital injected into the sector and will in due course make a public call for expressions of interest."

Sanusi gave his word to Nigerians that no bank will be nationalised and of course broke it without as little as a sorry. Of course again the noisy authority at the CBN does not appreciate the impact of his nationalisation agenda on the economy. By nationalising the three banks, their assets and liabilities were also nationalised meaning that the national debt would definitely increase if many of the banks’ loans are unable to be serviced. Furthermore by bringing the banks into public ownership less than two year after announcing a rescue package, the CBN is admitting that things are pretty bad and worse off as a result of its 2009 intervention.Nationalisation will eventually be harmful for the naira because it increases the debt and liabilities of the Central Bank and hence taxpayers.Of course fear has heightened in the markets with capital flight taking place as a consequence of equities being driven lower.

The current inquisition of capital has had and will continue to have short, medium and long-term ramifications for the Nigerian economy. Local and foreign investors who bought into the privatisation programme and borrowed monies to invest in the economy are obviously watching the theatre of the absurd that is taking place with alarm. No one will invest in a country where they will be called upon after five years to be insulted and called names on national television. Every policy and programme will always have its detractors, the privatisation programme was not a win-win game, but a zero sum game in which some sides lost and others won. Now the losers have gathered in the senate to like Shylock demand their pound of flesh. State owned enterprises that never worked nor produced a thing for years are now been falsely labeled profitable! What a scandal! That sadly is the story of our country! We have always lied our way through our problems and challenges!