Amalgamation Day in Lagos, 1914

Amalgamation Day in Lagos, 1914

28 December, 2011

The stories we ignore

I don't talk too much on this blog about the recurrent incidents of violence in our federal republic. Violence in Nigeria is a complex, complicated, exasperating, saddening and depressing issue that cannot fully be discussed in the confines of an e-blog.

Every once in a while I try to write what I always hope would be an abbreviated essay on the problem, but even while unfinished and still growing in length, these "abbreviated" essays eventually resemble short books. And even these "short books" are insufficient to truly discuss the issue.

What I want to do in this week of bloody attacks and bloody reprisal attacks is to remind us of the stories we tend to ignore. But even so, I have had to rewrite and edit down this introduction portion, because it grew to 14 pages! I am just going to get straight to the article and leave out any commentary. There are enough people commenting on the violence. One gets the impression that the way we talk about the issue reinforces the problem rather than solves it, that we sometimes miss the forest for the trees. In any case, there are enough people talking about it.

But first the introduction.

A month ago, Tadaferua Ujorha of Daily Trust gathered reports of courageous citizens who, at risk to their own lives, did what we all wish we were brave enough to do.

I normally prefer to post a link to the source sites for news articles, or at most block-quote a relevant excerpt. It is important for Nigerian news organizations to receive the "clicks", and associated revenues accruing. They invested resources on news-gathering, and will stop doing so if they are not making money. At least one of Ujorha's collected stories came from financially-struggling NEXT, which has had to massively reduce its investment in investigative journalism.

But in this rare case, I think the article is important enough that I will post the whole thing on this blog. Not many people (if anyone at all) read my blog, and I don't if any of you who do read take the time to click on the links (many of the older links are now non-functioning anyway). I want to make sure anyone who reads this blog post will also read the article.

Of course, you may not consider it to be as important as I do, but there is a way that we have come to think of each other as Nigerians. Our perceptions of each other have been, are now, and will be quite a stumbling block on the path of doing anything of positive impact ... in security issues as much as anywhere else.

Tadaferua Ujorha's collection of reports highlights two aspects of us as Nigerians, the heroic few who risk their lives to save their fellow citizens, and also the majority of us who lock ourselves away in our homes or run to the relative safety of the nearest police or army barracks, hoping against hope that the violence does not hit us or our families. We are together in this -- believe it or not, we are all at risk, and until we realize this we are not going to get anywhere.

Read the article, and if you like it, you might want to click the link anyway. I do not know how the whole revenue-from-clicks thing works, but if you want this type of reporting, you've got to help them pay for it:

‘I will never forget you’

Written by Tadaferua Ujorha who was in Kaduna, Kano & Niger
Tuesday, 29 November 2011 05:00

He has the courage of a Lion.

Adamu Bologi, a Muslim, is not likely to forget April 2011 in a hurry. It was the month when post-election violence broke out in Niger State, as well as in other parts of northern Nigeria. Bologi left for work early that morning, as he is wont to do.
He is a Librarian at Newsline, the Niger state government-owned newspaper. Later, he left to return home to give his wife some money. Home is Tunga, a part of Minna, and Tunga is a multicultural setting, accommodating a diversity of ethnic groups. Here are bad roads, open gutters and numerous dwellings, some large, some small. Too close to each other, some would say. It was while he was heading home that rioting broke out. There was thunder in Tunga on that day, and smoke from a burning Church filled part of the sky. The ‘Corpers Lodge’ was also torched. Fear and anxiety filled the hearts of many. All of a sudden a dark cloud fell upon the area. People fled their homes and headed for the nearby police barracks, the usual point of convergence at such moments. There was pandemonium on the streets. Men, women and children fled. The nearby Conqueror’s House Church, on Bay Clinic road,was burnt. According to Bologi ‘I saw some fifty persons holding cutlasses, sticks, and knives. They were saying if you are a Muslim go inside,we are looking for Christians. There is one compound near mine. Everyone living there is a Christian. The rioters focused on that house, and all the occupants instantly fled with their children’. He says that at risk of losing his life, he ferried all of them to the nearby barracks. He did all this alone. He adds ‘There was no other Muslim with me when I was going round.They just stayed by their doors,and looked from their windows’. While returning from the barracks he met the group of rioters who were upset with him and said so. His words ‘They heard that I am the one who took people to the barracks. So they warned me’. Here he was putting his life and properties at risk. After this he met a woman weeping as she walked along the road. His words ‘When returning from the barracks I met a woman who was crying, and she had two children by her side. I asked her what was wrong, but all she could utter was ‘my husband, my husband’. I took her to my room together with the two children. I gave her water to drink, and asked my wife to look after her. I then went out to look for her husband’. It was while he was outside looking for her husband that he came across another woman, being harassed by a mob.His words ‘They beat the woman and she fell down. The woman kept running and falling down, with her child too. She stood up, ran, but was felled again. I told them to stop beating her. But they didn’t stop. She was shouting. I then put her in the mosque of my house. I asked her to remove her slippers, before entering, because we don’t enter the mosque with slippers on’. After ferrying her into the mosque, he then went outside again, to see if he could locate her husband, whom she continually referred to, amidst tears. He walked to the nearby police barracks to see if he could seek him out, and on his way back he saw a man wearing a trouser and a vest, who turned out to be her husband. He hurried with him to his house, and now reunited husband and wife.

Not a drop of blood fell

Pastor Jeremy Omachi, bold and outspoken with a commanding voice, is the man he saved.He is Igala from Kogi State, and tells Daily Trust a moving story of his experiences in the following words ‘On 18 April 2011, a day after the Presidential elections,at about 11:00am I suddenly heard people chanting. I ran out to find out what was happening. I saw groups of people coming towards our house. I locked the door, and put my wife behind me,and asked ‘why are you people after us?’ They said ‘since you people refused to vote for Buhari, and you voted for Goodluck, we have come to kill you and to burn the Church’. In the ensuing exchange he signaled to his wife to flee from the house, and she did. Then the mob proceded to attack him with matchets and sticks. Then an amazing thing happened. According to him ‘Seven times they hit my head with their matchets, but the matchet did not draw blood. So all of us were shocked, and I thought it was not real again… But you could hear the sound of the matchet as it made contact with my head. It was as though it was iron hitting iron .Somebody even asked me why my head seems to be immune to cuts from a matchet.Then I fell unconscious.’ Later, he escaped from his house and headed in the direction of the police barracks. On his way there he had an encounter with Bologi. His words ‘Bologi ran after me. He asked me to stop,and asked if I am the Pastor. Then he took me to his house. Life came into my wife, when she saw me. She had already cried and believed that I was dead’.Later in the interview with Daily Trust, Pastor Omachi says of the events ‘I see Bologi as someone who has the kind of passion that I have.May the Almighty raise up more of such in our generation.’ The duo met for the first time after the events of April, when this reporter visited Minna in September this year while investigating this story. During the meeting Bologi says that if events were to repeat themselves he would behave in a similar fashion and save many more people. His words ‘I will behave in the same way. I will do much more than I did.This is a rented house.I am paying rent. If it were my personal house, I would have done much more than I did’. Bologi’s moving story has also been captured by Next.

Hayab helps a youth

In Kaduna, Reverend Joshua Hayab, Special Adviser to the Kaduna State Governor on Christian Matters, receives a phone call a day after the presidential elections. It was from the house of Mai Ungwar Gbagyi, which is in the Television area of Kaduna, a predominantly Christian community. The call was to the effect that a Muslim youth was about to be killed at the house. In fact the mob was prepared to burn down the house,if the boy won’t be released to them. There was tension in the area. Groups there were reacting to outbreaks of violence relating to the April Presidential elections. Reverend Hayab hurries to the location, and finds a mob gathered around the house of Mai Ungwar Gbagyi. He pleads with the restive youths ,and is finally allowed to leave the house with the much troubled youth. His words ‘I pleaded with them, and I convinced them why they must not kill this boy. I put him in the car and asked the driver to lock the car. I stood outside and spoke to them some more,and then they became calm. But before I knew what was happening another mob had come. I jumped into the car and we quickly drove away’. As they drove along, they came across another mob which also wanted to despatch the muslim youth in the Reverends car. His words ‘I came out of the car,and instructed the driver to lock the car from the inside. They now said ‘this bearded man in front of your car is a muslim, and we would not allow him to pass’. They later smashed both windscreens of the car. The youth was still inside the car when this happened. Upon instruction from the Reverend, the driver sped off and escaped the mob who were lined up all over the road.The Reverend who was still with the mob, was rescued shortly thereafter by soldiers from the nearby Command Secondary School. The driver had escaped there, and alerted the soldiers on duty about what was happening. Reverend Hayab says ‘It was akin to Divine intervention.In less than five minutes ,a military car just appeared from nowhere.’.

‘I won’t forget’

Dr Garba Shehu Matazu,a former Member of the House of Representatives, and now Senior Special Adviser on Higher Education to the Katsina State Governor, tells an interesting story of events in Kaduna, on the same day Reverend Hayab was rescuing the Muslim youth. In fact both men were within minutes of each other on that day. His words ‘I got to the Abuja junction with my driver. We saw people blocking the road, putting tyres and coming out with dangerous weapons, shouting and stopping vehicles. I told my driver, lets quickly get out of Kaduna. Unfortunately,on getting to the Abuja road, we actually met our brothers, both male and female Christians, also blocking the road. There was no way we could proceed,and there was no way we could return to the town… I asked the driver to reverse.While he was doing so,the crowd began to pursue us with dangerous weapons. We got to the junction by Command Secondary School. We could not go right where we were pursued, and we could not go left to Sabon Tasha. Hundreds of them had blocked the road with dangerous weapons.I then asked my driver to enter the Command Secondary School. I met both Christians and Muslims there.Infact by entering there you had become a refugee’. Outside the school were hundreds of armed and angry youths. Paradoxically, it was a Christian soldier who took Dr Matazu to the house of the Commandant of the institution. Another paradox lies in the fact that here is a former Chair of the House Committee on Education, who by an interesting turn of events so eloquently fashioned by nature, found solace in a secondary school at a time of crises. It was within the Command Secondary School that he met Reverend Hayab, who arranged for a number of cars to be brought from Government House Kaduna. These were used to convey both the Muslim youth, earlier saved by the Reverend, Dr Matazu, as well as many others made up of both Muslims and Christians, out of the Command Secondary School, to their homes in Kaduna. Reverend Hayab says ‘I put a call across to the ADC Government House. I said look my car has been damaged. I can’t even drive the car again. I can’t even leave the Command Secondary School. I told him that I am together with Hon Matazu and a few others. Can you send a team to rescue us? As we were standing there we could see young people outside the school with daggers. They certainly wont allow anyone to pass. Then help came in the form of armed security men and a convoy of cars from Government House’. But leaving the premises of the school was a bit difficult.According to Dr Matazu ‘When we were coming out of the entrance of the school, the youths blocked us. Despite the mobile police men, the well armed SSS,who were shooting in the air, they were adamant’. On getting close to his home, he turned to Reverend Hayab, saying ‘Thank you…Thank you... I will never forget you’.The youth whom he saved was taken to Government House Kaduna, and later returned to Rigasa where he lives. Reverend Hayab says that he does not know the name of the boy whom he saved from the mob. His words ‘I don’t know his name. I saw him as a brother from another family, and I wanted to save him. Somehow in a crisis situation we can still demonstrate a good heart towards one another, because the Almighty created us to live together’. He asks rhetorically ‘In my wife’s family, her mother is the only Christian, all others in the family are Muslims, and we are all of the same Jaba tribe. Now, do you want me to look at a Muslim as an enemy, when my inlaw comes from a family that is predominantly Muslim?’

Binta’s Hijab

In Kano, a woman’s Hijab worked wonders during the April crises. Soft spoken Binta Adamu is a Nurse resident in the city. In April this year she was very close to scenes of rioting in the city. There were two Christian classmates of hers with her at that time. What to do to save their lives? Swift thinking was required. Her woman’s intuition rose to the fore. She quickly reached for two extra Hijabs and gave the Lady’s to wear. Of course, the Lady’s were more than willing to accept them in the circumstances. That is how she saved their lives, because they kept on passing mobs who looked at them through the glass of the car they were in, and concluded that the three Lady’s within, wearing Hijabs, were all Muslims. None would have thought otherwise. With the trio was Hamman Ibrahim Rassan, another classmate and a Christian from Adamawa state. He led the Lady’s to a point very close to their homes, when they parted with Hajiya Binta.

The Suleiman’s of Tudun Wada

A households previous good deeds in Kano, helped to turn their residence into a small camp for the displaced. It is human nature to always remember the kind and good inhabitants of a town. Alhaji Mohammed Suleiman also lives in Kano. In 1981, he retired from the Murtala Mohammed Hospital as Chief Nursing Officer. During the post-election violence in Kano, his residence in Tudun Wada became a Mecca for non indigenes and other distressed persons. He has lived in Tudun Wada for more than forty years, and his family is known for its good works in the community. It is as though he has been nursing or played a healing role in the community all these years. No wonder a great crowd gathered during the crises. According to Alhaji Suleiman ‘Many people rushed here,and we harboured them.Many people from around this area came. In this area our family is respected a lot. My wife,in particular, has been very kind to everybody here. That’s why a huge crowd came seeking refuge here’. Hajiya Hadiza Usman, who also hails from Kano, is Alhaji Suleiman’s neighbour in Tudun Wada, Kano. Her comments on events in Tudun Wada shortly after the elections ‘We saw people running,and so we peeped out from the doorways. We soon heard people screaming outside,and people said it was because of the election results. My neighbour came earlier that morning ,and told me that if anything happened her children were in her house, and that I should take care of them’. Thus when the crises began, Hajiya Hadiza went and brought her neighbours children to the safety of her own house. A woman from Edo State, as well as an Idoma Lady found refuge in her house ,as well.

Kind Kamuru

Something remarkable happened in Kamuru in April this year ,where the Hausa community is ‘almost as old as the community itself’, one contact says. Kamuru is located in Southern Kaduna. When rioting broke out, community leaders took steps to protect the Muslim members of the community. It is a Christian community and there is a significant Hausa presence there. However, in the dead of night, houses belonging to Muslims were burnt down. Allahmagani Yohanna tells Daily Trust about what happened next. His words ‘A group of the elite of Kamuru came together and said they should put money and materials together and visit the area ,to talk to the Hausa-Fulani victims, and to appeal to them to remain calm and to come back. The idea was to make them feel at home, and for us to put together whatever materials we could, to make life a little better for them’. He says that some of the Hausas who lost their homes eventually became refugees in houses in neighbouring Ikulu villages. ‘They took in the Hausa-Fulani, those that had been displaced. They did everything possible to make them comfortable. He says his father is the District Head of Dutsen Bako, and adds that their house was turned into a refugee camp. His words ‘We literally turned our house into a refugee camp, and encouraged all those that have been displaced to come and stay there. Those that stayed at our house were up to four hundred’. The elite of Kamuru provided foodstuff, clothes, as well as accommodation for the displaced Hausas of Kamuru. Bishop Matthew Kukah of the Sokoto Diocese hails from Kamuru. Allahmagani Yohanna adds ‘Bishop Kukah’s house did the same, by ensuring that all that were displaced were kept there. They were fed, clothed, and some of them stayed there for weeks, until it became possible for them to go back home. ‘Finally, Allahmagani Yohanna comments on the changes in society which have occurred over time. His words ‘We have differences, but we have to live with these differences. It wasn’t like this before. During my secondary school days, I hardly remembered that somebody was a Muslim,or someone was a Christian, or that someone is Hausa-Fulani. We grew up living in peace. We are Christians in our house,but during the crises we were providing the Muslims with materials they need to pray.Irrespective of our differences we are still one’.

‘Pastor, hurry into my house, hurry’

Alhaji Usman Idris is a businessman, and dwells in Ungwar Rimi,a part of Kaduna town. There’s a COCIN Church in front of his house.Over the years he has developed good relations with the Church community, such that whenever he travels, he leaves the keys of his house at the Church for safekeeping. During the April crises a mob came around ,intent on destroying the Church, and killing its Pastor. Alhaji Idris says ‘Immediately we realised that these boys would not listen to what we were going to tell them, we had to tell the Reverend to hurry inside my house, together with his family. We called the police, who eventually came, and some of the rioters were arrested. We were able to save the Pastor himself, and he has now relocated to another part of the town.But he comes to the Church daily.’ Policemen still guard the Church during the regular Hours of Worship that hold on Sundays. However, the musical instruments belonging to the church were destroyed during the attack. Alhaji Idris speaks of a fire that occurred not too long ago very close to his house.It was women from the Church who brought buckets of water out of the Church, to put out the fire at a house which belongs to a Muslim.’ Alhaji Usman Idris,who hails from Zaria, speaks of growing up and associating with the former District Head of Zangon-Kataf. His words ‘When I was a boy in secondary school,the former District Head of Zangon-Kataf who died, was a bosom friend of my father. Whenever he comes to Zaria, I leave my apartment for him. He’s a Christian, and I go to his family to spend my holidays’.

Reverend John Davun, the Pastor who found refuge in Alhaji Idris’ house, tells Daily Trust ‘If a Muslim Brother would save me because of my Faith, I would give him kudos for that. As a Christian I would embrace him. Afterall, Christianity is all about peace.’

An Imam patrols

Aminu Abdullahi Yusuf is an Imam of the Misbahul –Islam Foundation Mosque, Unguwar Rimi, Kaduna. During the crises his efforts saved more than three Churches from being burnt to the ground. This is because he organized patrols through the area. No wonder he still retains a slim athletic build. His words ‘I was at home when I received a phone call that trouble had started in Tudun Wada. I went out and saw a ball of smoke, and I went straight to the District Police Officer. The DPO was happy to see me. I asked him to give me two policemen, because when trouble started in the past I would take two policemen inside my car,and we would go street by street, line by line to see how we could keep the peace. What I did was to tell everybody coming out to go back inside. So we would be able to control the situation by this method.If any crises ever occurs I had the habit of instantly calling the Pastor of the neighbouring Church, or he would call me. We coordinate very well.’ April 2011 was very similar to previous occasions when he did his patrols. According to him ‘Unguwar Rimi was already occupied by hooligans. We went street by street ,and we patrolled around all the houses, and we were able to prevent the loss of lives or properties. The policemen were given the order to shoot at sight. I asked them not to shoot anybody, as this would escalate the crises.’ He says that he and the DPO were regularly communicating throughout the period, by means of their mobile phones.’ This went on for two days, from morning till night. It was hectic. We saved three Churches by this effort. Usually, when there is a crises in Unguwar Rimi, we make special efforts to protect the Churches. So,this time the Churches in Bakin Kasuwa, and also the one at Low Cost were all protected.’

Debt Mismanagement

In 2000, perhaps as a sign of "international community" support for the year-old Fourth Republic, the Federal Republic of Nigeria and the International Monetary Fund reached a debt-rescheduling agreement. Our annual payments to bilateral (Paris Club) creditors were reduced from $2.3billion to $1billion, while annual payments to multilateral agencies (IMF, World Bank) and foreign private (London Club) lenders were cut from $1billion to $700million.

Combined payments to all foreign creditors was in effect reduced to $1.7billion-a-year. Payments to domestic (i.e. Nigerian corporate and institutional) creditors averaged $1.2billion a year, so total annual spending on debt servicing was about $2.9billion. The $1.6billion balance cut from our annual payments may have been subject to annual capitalization. I am not sure of this, but were it to have been the case, it would not substantively change the conclusions of this post.

Read this Vanguard article on Finance Minister Ngozi Okojo-Iweala and our burgeoning federal debts. Pay attention to these paragraphs:

Looking back at Nigeria debt’s profile and services in the last five years for which data are available, $2.335billion was spent by the Federal Government to service both internal and external debt in 2009. This amounted to about 50 per cent drop in the amount used for debt service in year 2008 which stood at $4.055billion. Before the debt relief of 2006, Nigeria spent $8.0429billion to service debt in 2006 and $10.1072billion in 2005.

Figures released by the Debt Management showed that in 2005 Nigeria used $8.940 billion to service its external debt paying only $1.1662billion to residents in Nigeria as domestic debt service. Nigeria’s obligation to foreign creditors in terms of debt service dropped slightly in 2006 to $6.729billion while what it used to settle due domestic debt and interest on outstanding loans inched up to $1.3137billion. With debt relief in 2006 its obligations to foreign creditors in terms of debt service nose dived southward with the payment of only $1.022billion as external debt service and $2.1629billion as domestic debt service.

I do not know if the interpretation of the numbers as expressed in those paragraph belongs to the writer of the article or to the DMO. The language conveys the impression that Nigeria lowered its annual debt service payments from a whopping $10 billion in 2005 to just $2.3 billion in 2009.

But there are crucial explanatory facts that have been omitted from the paragraphs.

Under the terms of Mrs. Okonjo-Iweala's debt cancellation deal, Nigeria had to pay $12billion to the Paris Club in order to receive the $18billion write-off. That $12billion payment was made in two (or three) tranches in 2005 and 2006; the DMO numbers for debt service payments in 2005 ($10billion) and 2006 ($8billion) in the quoted paragraphs above are comprised of that $12billion, as well as the regular debt service payments that would have been made for those two years. Breaking down the $18billion in total debt service paid in 2005 and 2006 combined gives:
(a) $12billion, the fee for the debt cancellation; and
(b) $5.8billion (at $2.9 billion-per-year) in regular payments to the Paris Club, multilateral agencies, London Club (private foreign creditors) and domestic creditors.

It would have been more appropriate for the DMO or the article's author to have said that our annual debt service payments had gone down from $2.9 billion in 2005 to $2.3 billion in 2009. This is obviously much less impressive-sounding, particularly in light of the fact that we paid $12billion for the privilege.

The counter-argument would be that $600million/annum would add up to $12 billion over 20 years. Add to this any avoided capitalization of the reduced portion of our payments per the initial agreement in 2000 with the IMF and other creditors.

This isn't a good counter-argument. If you held $12billion in potential investment funds, you wouldn't give it all away in exchange for $600million-a-year in money that will be eaten up by recurrent expenditure.

At the time of the debt deal, we were told we would save $1 billion/annum or (as they frequently said) "$20billion over 20 years", and that these funds would be allocated to the Millennium Development Goals. At that time, I wrote an essay questioning this on the following bases:
(a) You could earn the same amount of money over 20 years from compounded interest by simply investing the $12billion, while maintaining your principal;
(b) $12 billion properly invested and leveraged could have a multiplier effect on the GDP in excess of $1billion-a-year;
(c) The savings were being over-estimated because Nigeria would definitely start borrowing again, which would mean debt service payments to foreign creditors would rise again from the alleged "$0" to a new number that would cut into the so-called $1billion/annum savings; and
(d) $1billion/annum would not make much of a difference in the Nigerian federal budget, or to the Millennium Development Goals, and as such was not worth the loss of $12 billion in potential investment funds.

These are the DMO's figures on the federal government's ballooning domestic debt:


2005 = $11.83billion
2006 = $13.81billion
2007 = $18.58billion
2008 = $17.69billion
2009 = $21.87billion
2010 = $32.5billion
2011 = $40billion

Somehow, the federal government has racked up at least $28 billion in new debt in just 6 years (2005-2011)!.

The upward spike in domestic debt between the end of 2009 and the end of 2011 may have been linked to the global financial and economic crises, but may also have been driven by the effect of the approaching 2011 Elections. The only clearly identified case of election-year largesse was revealed by the junior minister in the Finance Ministry to the Senate; he said the 2011 budget included funding for only two months of the "fuel subsidy" (i.e. up till February), but the government had decided to continue paying the subsidy past February for fear of losing the 2011 Elections (held in April).

There were likely other expenditures directly and/or indirectly driven by politics. On a related note, the $4.055billion in debt service paid in 2008 (as opposed to the normal $2.3 billion) may have been linked to late payments from 2007 delayed due to spending spikes associated with the 2007 Elections.

As our public debt-load continues to rise, annual debt service payments will have to rise too. Eventually, we will return to payment levels extant before the 2005 "cancellation" deal, and shortly thereafter to payment levels from before the 2000 IMF deal. And for this, we paid over $12billion in savings.

And what has happened to our savings anyway? In the last six years we have:

(a) Spent $12 billion in reserves on the debt cancellation deal;
(b) Spent $20-$30 billion in reserves defending an artificial Naira/Dollar exchange rate;
(c) Spent $10 billion of our reserves to bail out banks caught in a "toxic asset" problem of their own creation.
(d) Spent an unknown (by me) total amount on other industrial interventions.

This adds up to $42 billion at least, but is definitely more than that. The first three were not what you might call "productive" investments; I hope someone studies the impacts of the fourth. This is where our external reserves went.

For the record, I advocated a firm and direct intervention in the banking and financial sector to fix the "toxic asset" problem. From the start I have said I do not like it, but it was (and is) economically necessary. But it is still an avoidable waste. The USA and Canada are deeply integrated economies, but Canada's banking industry fared better than its southern neighbour's when the global crises hit because they were better-regulated.

Nigeria would always have been affected in some way by the global financial crises, but our "toxic asset" problem was self-created, driven by the action of our banking industry and the inaction of our regulators. And our all-too-obvious stock market bubble was bound to "pop" even if there had never been a global crisis. Our banking/financial industry, regulatory agencies, government, and political parties (especially the PDP) bear the blame for our problems.

Personally, I think the banks should be made to repay the Nigerian public the full cost of the bailout. They don't have to do it this year, or even next year. We can wait until they are back to full health. But we should make them repay our money , though that is a different argument for another day.

With little debate or discourse, public debt is becoming a serious problem, and not just at the federal level. The states are wallowing ever deeper in debt; incoming governors always blame their predecessors for leaving behind a fiscal mess, but then work very hard during their terms to expand the mess, before finally leaving office to be accused by their successors of leaving behind a fiscal mess.

We are told that it isn't a problem, because our economy is bigger and the ratio of debt to GDP is smaller. But this isn't an excuse for racking up unproductive debts.

07 December, 2011

Brief comments

Mustapha Chike-Obi, the head of AMCON told the Senate Committee on Banking, Insurance and other Financial Institutions that the 8 banks which received =N=620 billion in emergency bailout funds in 2009 have repaid the full amount to the government

What he did not say is the banks were able to make this repayment because AMCON paid over =N=1.2 trillion for the banks' toxic assets. When you blow away the fog, the Government/CBN/AMCON more or less gave the banks =N=600 billion in bailout funds, wrote off the bailout money, and then gave the banks an additional =N=600 billion for their toxic assets, on top of extra money poured into the nationalized banks to recapitalize them.

The bailout is not something I like, but I have always said that it was necessary. With that said, it would be good for Nigerians to understand how much the whole thing will cost us when all is said and done. Because we cannot go back to the days of letting the banks and the regulators get away with knowingly doing the wrong things; when they do that, we end up left with a choice of either coughing up billions we don't have to fix the industry, or watching the industry falter with problematic effects on the wider economy (which, by the way, is still growing).

In other news, the Code of Conduct Tribunal has decided it does not have jurisdiction to try Lagos State Supreme Godfather Bola Ahmed Tinubu for corruption.

Note, they did not say he was innocent. They said they were not the arena for him to be properly charged. Long story short, the Federal Government and the Peoples Democratic Party have made their point, letting Tinubu know that he is free to do what he does so long as he limits what he is doing to the constituencies they have allowed him to have.

By the way, last weekend the PDP somewhat controversially won the Kogi State gubernatorial elections over an ACN candidate backed by Bola Ahmed Tinubu. Am I being too cynical in pondering whether Tinubu got the intended message?