Whispering Drums With Maigani
by Musa Ibrahim
Nigeria and the IMF
Taking a step further, the General then proceeded to enumerate the country's fundamental problems which are seen to revolve around the follow- ing identifiable contradictions: (a) a decrease of the country's domestic production while the population continues to increase; (b) dependence on imports for both consumer goods and raw materials for the country's industries; (c) a grossly unequal gap between the rich and the poor; (d) the large role played by the public sector in economic activity with hardly any concrete results to justify such a role.
Okay, these are the problems. So what needs to be done? Two policy options or alternative routes exist. Nigeria could embark on a national economic management WITHOUT external support, or a national economic management WITH external support. If the former, then Nigeria would have no need for those endless talks with such arrogant and unfeeling bodies such as the International Monetary Fund (IMF) and the World Bank. If the latter, then the country would have no option other than reaching a negotiable agreement and submission to the IMF conditions. Both options have far reaching implications.
To decide to pursue national economic management without the IMF implies that Nigeria's new set of military leaders shall be compelled to continue presently existing measures of retrenchment and risk escalation of un- employment; increase austerity measures since Nigeria, and, indeed, the leaders do not control and cannot adjust to international economic conditions, mainly because the oil market is unpredictable and is likely to continue to deteriorate. In other words, the country will continue to operate on an ad hoc and non-strategic arrangement. This type of arrangement is called, in economic terms, "planlessness arrangement."
To resort to economic management with the help of the IMF will involve going strictly by the IMF conditions. Some of these conditions, already rejected by the Buhari regime include: (1) an exchange rate adjustment or Naira devaluation; (2) removal of petroleum subsidies. The main reason behind this demand by the IMF is that subsidisation encourages high energy consumption, the cost of which the consumer is not adequately paying for; (3) Trade liberalisation. On the surface, this implies an opening up of the Nigerian market to foreign goods. The implication opponents of IMF fear is that by accepting the conditions of the IMF it would mean a foreign organ or body is forcing Nigeria - a whole giant of Africa to take certain measures considered "anti- nationalistic" and which are bound to cause social and political unrest. Does that remind you of WAI spirit?
Talking tough, General Babangida admitted that even though Nigeria's application for an IMF loan was made in April 1983, no progress has as yet been made in the negotiations "and a stalemate has existed for the last two years." Then in his characteristic military fashion he added: "We shall break the deadlock that frustrated the negotiations with a view to evaluating more objectively both the positive and negative implications of reaching agreement with the Fund... At all times in the course of our discussions, our representatives will be guided by the feelings and aspirations of the Nigerian people”
Reporting his speech, the western media were already saying that Babangida is now ready to accede to the demands of the International Monetary Fund.
I am not an economist so I am not in a position to offer an expert advise. Over the years, however, African nations have gone cap in hand to the IMF for redemption. I am not sure which of those countries indeed got redeemed. There are talks that Jerry Rawlings' Ghana is now a better place to be in - thanks to the IMF. I am not in a position to know. Nigeria right now cannot by any standard, be considered a poor nation. No matter the foreign debts owed (debts do not kill afterall), the country's human and material resources are enough assets to take care of any such loans. We could even refuse to pay! Good management of what is available has always been the country's main problem. If the country gets an additional $2.8 billion from the IMF and the money is not properly managed, it will be of no use.
General Babangida seems the kind of person that has enough managerial skills (he has managed, so say the foreign press, to be involved in four coups in Nigeria!). If his regime can be truly and sincerely opened to public accountability then the nation's present economic resources are enough to see the nation through the woods. But if an IMF loan had to be taken at all, then the AFRC (Armed Forces Ruling Council) should call for a public debate on the matter and try to get the common consensus and consent of the people. It is the only way to guarantee the workability of the Fund because then, people would really be ready for the structural readjustment requested by the IMF, and so would not complain if any hardships should spring up from the IMF package later on.
