Reflections on the last twelve months, By Ifeanyi Uddin

Ifeanyi Uddin
Ifeanyi Uddin

An eventful year ends, much as it began — inauspiciously. Which is sad! For we recall the immediate past not so much for how well off we have turned out (though, arguably, the past twelve months had moments that, had the brave been sufficiently persuaded to try, held out the promise of real redemption). Instead, what is etched, indelibly in most cases, in our minds are the episodes (the bombings, the unresolved murders, the melodramatic kidnappings and ransoming, the deaths by a thousand different ways) that remind us of how far we have veered off the beaten path. Why not then look away from Janus’ rear-facing visage, and instead contemplate tomorrow? Too early to call the New Year! Nevertheless, I suppose it is safe to presume that the federal government will not muddy the waters as perversely this year as it did last year. Still, in a way, the disruption to social and economic life, which heralded 2012, was a potent augury for the year.

At this point, we could be talking just about anywhere in the world. All through last year, global output growth sputtered and stuttered. The euro zone struggling with sovereign debts, agreed solutions that it just as soon found very hard to implement. US numbers were all over the place, everywhere, that is, but the one place everyone wanted them to be — up. Asia was unsure what portion of the shoe that belongs to the world’s growth engine it was willing to take up. Emerging markets? These were in better fettle. But collectively, still too puny to affect much besides their own nationals.

But my concern, today, is with activity much closer home, where the sense is that the more crucial motion and movement last year were either lateral or backwards. Is this raw pessimism? Am I guilty, as bruited about in the corridors of power concerning perspectives similar to mine, of the charge of being no longer able to see the trees for the woods? I concede that the incumbent administration may have been very hard at work all through last year (it could hardly have been malingering all year long). The difficulty is ascertaining the nature (and ultimate ends) of its exertions.

I spent much of the last year looking at the numbers from the official bean counters. None improved by much (the savings on the excess crude account, and improvements to the external reserve balance were notable exceptions). Government, hard at work in those arcane spheres of the economy did not quite help the key measures. Higher tariffs on rice and wheat hit pockets harder at the lower rungs of the ladder. Even the gods were unusually unkind, last year. Once the Cameroonian government opened the sluice gates at the Lagdo Dam, our agricultural sector was never going to look quite the same again. Worried by the huge task of comforting the displaced, we cannot do much, but pray, about the farmlands still under water.

Add double digit (and trending up) inflation levels to the unsupportable unemployment numbers, and our misery index is headed in one direction only. Now, there is one index that might support a panglossian gloss on the economy’s performance. Regrettably, it is not the fiscal deficit numbers. At the beginning of last year, we were shooting for a fiscal deficit of around 2.27% of the budget (about N1.16tn). We ended up with a slightly higher deficit, although we earned more from the sale of our sole revenue earner, and spent less on creating fixed assets than we had budgeted for. All of this extra spend did end up somewhere, if the gini coefficient for the economy bears true witness to its performance. If income inequality worsened last year, as indeed most observers say it did, then government may have operated in the interest of the top earners in the country. Accordingly, these latter elite are getting richer, not so much at the expense of the rest of us. But through their knowledge of and access to the location of government’s bakery.

The cure to our myriad problems over the next 12 months might not be how to bake a cake big enough for the poor and the vulnerable to be assured a share of. Anyway, not if we all do not know our way to the bakery. Better yet (even as we try to redress this information asymmetry) to restructure the way government’s money is spent. Or, put differently, to put enough money in the pockets of the millions of Nigerians who (for diverse reasons) currently contemplate a bleak New Year. At least they will spend it in a way that drives demand locally, rather than find novel ways of ferreting such monies abroad.

Ifeanyi Uddin writes a weekly column for PREMIUM TIMES . He is our authoritative in-house analyst on business and economy.