The Wrong Economy Train or Is It Team

Samuel Akinyele Caulcrick

The Central Bank of Nigeria (CBN) Building is one of the tallest and the biggest structures in Abuja. This is the same building that adorns the face of Nigeria’s N1000.00 naira note. Adjoining this massive multi-story structure is the expansive National Ecumenical Centre and not surprisingly, the Abuja Central Mosque is not too far in the distance. These three massive buildings are situated in the Central Business Centre of Abuja, the nation capital. I, for personal reason, want to avoid the wrath of many who are hypocritically sensitive in the business of God. For that, I will only concentrate on the business of man. My theme, therefore, is about our miss-road economic train. Nobody seems to want to explore or talk about the alternative economic thinking. That beats me and if I may I will rather go back to my weird reasoning! The size of the CBN Building when compared with another building, also in Abuja, that should have been the biggest structure – at least bigger than the CBN Building – in a progressive economy, is bungling to an uninformed mind like mine.

Situate in an almost obscure part of the city of Abuja, zone 7 to be precise, is a three-story building that houses the Federal Internal Revenue Service (FIRS) and the dissimilarity of this building to that of the gigantic CBN, to me, is astonishing. The comparison in size of these two buildings, each of which has come to symbolise the route the Naira takes back to fund government treasury from the citizens, could be a simple indication of our economy fundamental defect. From my room in my hotel, the CBN Building loomed larger than any of the hills that dot the city. Mesmerised by it, I was initially proud of Nigeria for the gigantic size of our Central Bank Building, but that was until I stumbled upon the miniaturised FIRS Building. Those who have seen and compared the U. S. Federal Reserve Building, which oversees over $200 trillion GDP of the U.S. and the U.S. Internal Revenue Service (IRS) Building that generates a chunk of that over-$200 trillion economy for the U.S. government, will get my drift. The Federal Reserve Building is dwarf in comparison.

Central banks’ role in any economy is one of the most vital and apart from the oversight function to other banks, central banks hold the deposits of governments’ internal and external generated revenue. In addition, the apex banks could make a little profit from interest rates. However, since 1986, our CBN has taken the centre stage in generating funds for government through its bureau de change activities and this is an aberration. Traditionally, the FIRS and the Customs Service ought to be the largest depositors in our apex bank, which would then be a source for cheap borrowing. Since taxes and duties are products of legislation, government could easily lower or raise the lending rate in consonants with inflation. With that, government has control of the economy. However, as it is, all sectors of the Nigerian economy have been made, by the present system, to scamper for the scarce foreign money at the foreign exchange market through auctioning. Government thus has lost control of the economy to the highest bidders who now dictate the direction of the Nigerian economy.

Traders, benefactors and beneficiaries of government patronage, by their disposition, will always outbid the productive sectors and have consistently outbid the productive and wealth creating sectors at the foreign exchange market. That to me is the big problem. Nevertheless, government has to be funded. The problem is by what means. We may continue to fund government treasury in naira through the auctioning of the oil receipt or we could pursue a traditional reformed taxation. The worst deceit ever perpetrated on this great country is the Exchange Rate as being determined. When you hear our celebrated economists, the likes of Soludo, talk about Naira exchange rate, you will want to believe it is the exchange rate between Nigeria and the rest of the world. No sir! Nigeria has nothing to exchange with the rest of the world apart from oil and that is already priced in the U.S. dollar. Our factories have all shut down, agricultural produce have disappeared, etc. What these economists refer to as the exchange rate is the rate of exchange of the oil dollars between the government (the largest sellers of foreign money) and the rest of us.

I am not that familiar with Abuja, and for that reason I had taken a guide. My guide, a journalist friend, did not immediately understand my agony and why I continue to moan about the dissimilarity of the two unconnected public buildings to the state of Nigeria’s economy. The composition of the 13-man economic team is also a worry to me. To start with, we are not lucky with number 13, but they say it’s lucky for some. I had expected the likes of the Elder Economist Ibrahim Ayagi in the team to give a minority angle to the way forward. All those professors and bankers, with due respect, are same of the same – the Chicago Boys. They are apostles of Milton Friedman, the infamous ideologue of the now discredited ideology that is responsible for the present global economic woes. Me, a man not fit to lace the boots of any of the economic team members, to challenge not only the composition of the economic team but also their ideologies, is effrontery in its highest order – my journalist friend concluded. He got further irritated when I could not stop talking about Tax Reform. He reasoned like many Nigerians that whatever tax collected will still end up in the pockets of the politician in any case. When I insisted that corruption is not as damaging to the economy as the inability of the vital sectors of the economy to have easy access to the forex (sic), he lost his patience with me. He modestly declined to be my Abuja-guide no more.

Captain Samuel Akinyele Caulcrick