By; MUSA ILALLAH
Most, if not all Nigerians are of the firm belief that Finance Minister, Olu Falae’s medicine of Structural Adjustment Programme (SAP), introduced during the era of military Head of State, General Ibrahim Badamasi Babangida in July 1986 is the foundation upon which the present economic crisis of the country was laid.
Undoubtedly, the IMF-World Bank economic policy packages embodied in the structural adjustment programme, SAP provided an overt encouragement to the fostering of an unregulated, dependent capitalist development model, while allowing only a supportive role for the government in a refurbished economic environment of highly reduced government ownership and control of enterprises.
Since SAP came into being, inflation has assumed a doomsday scenario from 5.4% in 1986 to 40.9% in 1989. Nigeria’s annual inflation rate in November 2023 was 28.9%.
The principal price of SAP measures Nigerians are paying today, include faulty external debt management strategies, removal of subsidies on petroleum products and fertilizer, privatization and commercialization, trade liberalization, and interest rate deregulation. This SAP-induced inflation has resulted in adverse income redistribution, leading to increased personal insecurity among other evils.
The pressure by IMF and the World Bank first reared its ugly head on the Nigerian government when General Muhammadu Buhari was military head of state way back in 1984.
Considering the evils associated with SAP and its likely consequences on the economy and Nigerians, the then head of state. General Muhammadu Buhari refused to adopt the IMF-World Bank economic medicine to float the Naira and other packages embedded in SAP.
Much later when he was elected in 2015 and sworn into office as Nigeria’s civilian President Muhammadu Buhari had expressed skepticism over decision to float the Naira in line with request of IMF and the World Bank.
In an exclusive interview in 2016 with Al jazeera TV, Buhari did explain why he was going against the IMF and their call for him to float the Naira. Buhari knew that Nigeria would not survive another SAP.
As President, Buhari while speaking to business leaders, said that he doesn’t like the returns he gets from the Central Bank of Nigeria (CBN) on the pressure to devalue the Naira against the dollar.
“How much benefit can we derive from this ruthless devaluation of the Naira,? I’m not an economist neither a business man, I fail to appreciate what is the economic explanation,” Buhari quickly added.
Previously, Buhari had consistently refused to abandon an official exchange rate of the Naira to the dollar, arguing that ‘to do so would stoke inflation in the country.’
Recalling the might of the Nigerian currency in 1985, former President Buhari said, “Naira was strong until my removal in 1985”.
Speaking at a meeting with members of the Council of Retired Federal Permanent Secretaries during his first tenure as President, Buhari told the high level technocrats that he resisted the pressure from the International Monetary Fund and World Bank to devalue the currency and remove fuel subsidy.
He insisted that he was yet to be convinced that the vast majority of ordinary Nigerians would derive any tangible benefit from a devaluation of the naira.
The president said he still held the conviction that motivated his principled resistance to devaluation in his first tenure as military Head of State.
“When I was military Head of State, the IMF and the World Bank wanted us to devalue the naira and remove petrol subsidy but I stood my grounds for the good of Nigeria.
“The naira remained strong against the dollar and other foreign currencies until I was removed from office in August, 1985 and it was devalued.
“But how many factories were built and how many jobs were created by the devaluation since then”.
“That is why I’m still asking to be convinced today on the benefits of devaluation,” Mr. Buhari told the retired Permanent Secretaries led by Christopher Tugbobo.
Mr. Buhari welcomed the council’s pledge of support for the successful implementation of his administration’s change agenda, especially in the priority areas of improving security, curbing corruption and revitalizing the nation’s economy.
Regretably, indications are that the PBAT administration has surrendered the country into the hands of the IMF and the World Bank.
That explains why the Subsidy removal and the floating of the Naira were done before he even had a cabinet or economic team during his sewarinh in at the Eagle Square in Abuja on May 29 last year. Indeed Nigerians are into SAP phase II.
To say that Nigerians are in for the worst time with inflation, high cost of living, highest cost of fuel among others is an understatement. The lives of Nigerians today are in real danger. Most people hardly afford 2 meals a day and the cost of transportation and prices of food items have increased many folds.
The plain and bitter truth is that Nigeria is in SAP phase 11.
MUSA ILALLAH writes from Emeka Anyaoku Street, Abuja and can be reached via; musahk123@yahoo.com
