The Best President Nigeria Never Had?

There are several myths in the Nigerian political space. One of the longest-running ones is about Obafemi Awolowo. He was the first premier of Western Nigeria and federal commissioner of finance, seen as the best Nigerian president we never had. So strong is the allure of that notion that every South Westerner who aspires to any political post of substance invokes the image of the great man. Bola Ahmed Tinubu, one of the three frontrunners in this month’s presidential elections, calls himself a disciple of Awo. But those who have studied development in other climes have a feeling that, at best, had Awolowo become president, he would have been like Kwame Nkrumah, Ghana’s first president, and a pan-Africanist to the core. Dr. Nkrumah was not a terrible leader, but he was also not the shining example of development that many thought he would be when he was an activist. Like Nkrumah, Obafemi Awolowo of Nigeria was also a nationalist. Like Nkrumah, Awolowo drifted towards socialism and flirted with the USSR. By 1966, Nkrumah had become unpopular with his wage freeze, tax increases, and a compulsory savings system to halt a serious drain on foreign exchange reserves. Curiously, he instituted these policies without reducing prestige expenditures for the political class.

Earlier in his tenure, civil servants, including rail and dock workers, protested, demanding the release of political prisoners and the holding of new elections, as well as satisfaction of their economic grievances. A week-long strike action was embarked upon by Ghanaian workers in the three main towns of Accra, Kumasi, and Takoradi in protest against the government’s compulsory saving scheme and reflected the growing discontent of the Ghanaian public. When he was toppled in a military coup on February 24, 1966, the people rolled out the drums in jubilation. With policies similar to Nkrumah’s as observed during his time in western Nigeria, it is not not unexpected that Awolowo would have met the same fate if he had led the federal government, given that Nigeria is more divided than Ghana.

Another leader Nigerians like to fawn over is Umaru Musa Yar’Adua (UMY). On May 5, 2010, he died after a protracted illness. It was a sad day. He appeared to be a soft-spoken man who meant well for the people. It was he who initiated the Niger-Delta Amnesty Program, which saw hundreds of youths in the oil-rich Niger Delta empowered. This was contrary to the popular notion that he would clamp down on the restive youths who were blowing up oil installations for their grievances. There are those who said he rewarded bad behavior, but what cannot be denied is that the program was well-received by all and that it doused tensions in the Niger Delta region, thereby shoring up oil production with many of the ex-agitators rehabilitated.

He was also the first Nigerian leader to declare his assets. He declared he had ₦856,452,892 (US$5.8 million) in assets, of which $1.9 million ($0.1 million) belonged to his wife. Don’t be surprised at his wealth. Yar’Adua came from a wealthy home. He was the son of the Minister for Lagos in the First Republic, brother of a former de facto vice president of the federal republic, and a former state governor himself. He did not only declare his assets; he also laid bare his ₦88,793,269.77 ($0.5 million) liabilities. His plan, clearly, was to set a good example for public office holders and discourage corruption.

I understand that death hypes one’s legacy. Many pointed to the above deeds to predict how great he would have been if he had not died after only three years (it is worth noting that everything he did was done in just about two years due to his poor health). However, some of the things he did showed that he would have left Nigeria in worse shape than he met it. For instance, Yar’Adua is the first Nigerian leader to reverse a hike in the price of fuel. As soon as he was inaugurated on May 29, 2007, one of his first actions was to reduce the price of fuel from ₦75 to ₦65. This act was widely praised by Nigerians. But as you queue for fuel today, know that that act is one of the contributing factors to your suffering.

Even worse, the epileptic power supply you are grappling with today, making you turn to solar inverters and generators, is one of the legacies of UMY. In 2001, the National Council on Privatization, set up by the Olusegun Obasanjo government, agreed that reforms to the electricity sector were the way to go. They agreed that the monopoly of the National Electric Power Authority (NEPA) should be dismantled by privatizing it, a regulator should be established, and the electricity tariffs should be raised by at least 200%. Raising the tariffs, like it happened in the telecommunications sector, was seen as the only way to attract the private sector, both domestically and internationally.

The thinking was that if they know they can have returns on their investments, they will come in. President Obasanjo disagreed. His argument was that electricity is a human right and that raising the tariff so high would harm the poor. It was a comical argument. These citizens did not have regular power supplies in the first place, and a large percentage of the poor were not even connected to the grid because they lived in villages. The city’s poor do not have electricity because the state company was not only incompetent but also lacked funds to maintain the power infrastructure for the masses. The rich in places like Maitama, Ikoyi, and Ikeja GRA were prioritized in the supply of electricity, and they were getting the supply at ridiculously cheap rates. If you raise tariffs, they would be forced to pay more, and the private sector would then use the funds to create infrastructure for the poor. If the rich pay more for electricity use, investment in rural areas spurred by more investors would come in. The cycle will continue until electricity is widely available. Again, this played out in the telecommunications sector. This was the proposal for the power sector as put forward by the Bureau of Public Enterprises (BPE), charged with the overall responsibility of implementing policies for the privatization and commercialization of Nigeria’s comatose public enterprises in 1999.

President Obasanjo rejected the proposal outright in 2001. For four years, the power situation in Nigeria kept getting worse. Attempts to shield the poor from paying market prices hurt them in the long run. Then, in 2005, Obasanjo grudgingly accepted that the proposal be considered. This was when the Electric Power Sector Reform Act was passed. This act broke NEPA down into 18 companies: six generation companies called GENCOs, one transmission and system operations company (under the control of the federal government), and eleven distribution companies called DISCOs. The Nigerian Electricity Regulatory Commission (NERC) was established as a regulatory body to issue licenses.

At this point, the only action left was to raise the tariff. Investors had been promised the tariff would be raised. In fact, some of the GENCOs and DISCOs were bought by investors because they had been promised the tariffs would be raised to justify their investments. Unfortunately, because of the exchange rate deterioration, the tariff needed to be raised by as much as 400%, up from 200% in 2001. That became the cost of the delay in reforms. As an aside, the more you delay reforms, the more painful they become when they are eventually carried out. Like in most things, delay is dangerous. So, 400%.

All these discussions were happening towards the end of 2005. 2007 was going to be an election year. And anyone who knows anything about Nigerian politics knows that the year before the elections is for campaigns. So the president was in a fix. A 400% tariff increase would be unpopular but life-changing for the people in the long run, just like the telecommunications sector was already shown to be in 2005. Still, with elections approaching, there is the risk of violent demonstrations on the streets, fueled by shortsighted civil societies. Working for the president at this time is the fact that he would not be on the ballot. He was in his second term and would not be contesting, having seen his agenda for a third term scuttled by the legislative branch. BPE argued that he should carry out the reforms and get them done once and for all. After discussing with his party chiefs, the president decided not to take the chance; he decided he wouldn’t be the one to make his party lose at the polls. He decided not to bite the bullet. He refused to go the full length.

To his credit, Obasanjo did not totally discard the reforms. Thanks to the frugal nature of the government and his standing in the international community, Nigeria had gotten partners to buy its oil, built up the excess crude account (a savings account), and negotiated intensely for its debts to be forgiven in some cases and reduced in others. So, the country had funds saved up. Obasanjo decided that he would use part of the funds to build nine power stations. Two in the Southwest and seven in the Niger Delta. All nine would use gas. The last sentence is a masterstroke. The gas we burn in the petroleum production process (called gas flaring) in Nigeria is huge. We occupy the 7th position in the list of countries that flare gas in the world. Nigeria burns the equivalent of 28,000 megawatts of electricity every day. We burn it like we burn paper. All wasted. If we harness that gas, 28,000 MW of electricity would be generated. To provide context, in December, just last month, The Cable reported that according to NERC, Nigeria’s total installed capacity currently stands at 10,396 MW. In other words, using the gas instead of flaring it would provide about three times what is currently available.

So that was the plan: build nine power stations with our savings. General Electric, the largest turbine manufacturer in the world, got the contracts to build the seven power stations in the Niger Delta. Chinese companies got contracts for the two others. The companies started the construction.

Then there were elections. Unfortunately, as soon as UMY became president, he stopped the construction of the nine power stations. He also scuttled plans to handover the power transmission to a foreign firm and away from the hands of the federal government which would have improved the transmission of generated power from the GENCOs to the distribution companies. If he had allowed the construction, the power stations would have been completed by December 2007. 16 years later, they are yet to be completed. Whatever reservations UMY had, the cost of building them have more than tripled with the current exchange rate. And now, we have no savings.

Admittedly, the problem of the power sector is multifaceted but you would agree with me that having an installed capacity of 10,000 MW and distributing only 5,000 MW, like we do now, because the grid is inefficient is dismal. UMY’s actions contributed to the failure of that sector. At the time, Reuters reported how UMY’s actions scared away investors. Speaking to the publication, Bismarck Rewane, chief executive of Financial Derivatives, lamented, “Yar’Adua is known as a do-nothing man.” “I don’t think these changes will achieve anything.”

So, next time you read or listen to people express opinions about the best president Nigeria never had or had time to experience, know that it’s an overused phrase / discussion that has no bearing in reality.