On the matter of the health of the Nigerian economy and the country’s medium-term outlook, I’ve taken part in long, and often acrimonious, debates. Without oversimplifying the relative positions of the parties in some of these conversations, the crux of the arguments remain the question, “What does it mean when government pledges itself to a private sector-led growth development model?” Rising levels of government debt, and an increase in government’s share of domestic output are both clearly not consistent with this goal. However, the other side has long defended recourse to these expedients in terms that clearly do not flatter the domestic capacity for innovation and entrepreneurship. “This is Nigeria”, nearly always suggests a diminished capacity to engage at the levels that other better placed economies have.
Reluctant (or maybe, unable) to de-risk the system, by eliminating all impediments to private investment, the current local take on economic policies has made its peace with an unusually accommodative monetary policy regime. And all of these before COVID-19 was a thing. The new heterodoxy prizes the fiscal and monetary authorities’ allocative capacity above all else, even as evidence mounts of severe distortions to demand and supply relationships that are showing up in both higher internal costs for the economy (inflation) and higher external prices (the exchange rate).
So popular is this take on the management of the economy that the more orthodox assessments of the outlook for the country have taken to brooding from the sidelines. There, these now forlorn figures point to how poor policy choices will hurt the economy’s medium- to long-term outlook, while providing only fleeting short-term respite. The more pessimistic then trace a straight line from the resulting poor outcomes of our current policy choices to forecasting generally straitened social circumstances. And from there to fearing worsening security conditions.
And governments? Paralysed by the speed and reach of the protests, the federal government froze like a dear caught in the headlamps of a runaway freight train – unsure which to censure: its citizens, for daring to protest; or its bouncers for excessive use of force. At the regional level, the politics was more craven. Governors rushed pellmell, to the hashtag stumbling over each other to appear more empathetic to the protests.
Beneath appearance, though, the #EndSars movement simply returns us to the question with which this piece opened: “What does it mean when government pledges itself to a private sector-led growth development model?” Whether the aim is to inter the Special Anti-robbery Squads, to reform the police, or borrowing from elsewhere, to “defund” either or both, at the heart of the matter is where one stands on the not so small matter of letting the private sector lead the economy’s growth and development. Of course, we cannot achieve this goal without freeing our kids to be creative and original, while removing all restraints to investors backing the enterprises that emerge from these.
This is why it will not come as a surprise if the next intervention fund series is dedicated to police reform. Our government will do anything to prevent the emergence of a vibrant private sector.
Source: Premium Times