The federal government has blamed the nation’s economic woes on Ibrahim Babangida’s military administration.

The government said the country was yet to recover from the naira’s first devaluation in 1986, when former president Babangida introduced the Structural Adjustment Programme (SAP).

Information minister, Labaran Maku, who revealed this, said the country had since the devaluation faced high unemployment rate, crises in its educational sector as well as collapse of industries.

But in reacting to the accusation, Mr Babangida said the minister was suffering from “hallucination,” and was too “carried away with his saxophonist job to remember simple history.”

Mr Maku, who spoke at the flagship interview programme of the News Agency of Nigeria (NAN), tagged ‘NAN Forum,’ insisted that unemployment and falling standards in education, which began in 1986, have continued till date, leading to de-industrialization and social tensions.

He said the 1986 devaluation was also responsible for the problems in the Niger Delta and other parts of the country where unemployment has given birth to youth restiveness.

“Why has youth unemployment mounted? Because over the last 20 years, the economy has not grown, there has not been any manufacturing.

“Following the devaluation of the naira in 1986, by 1990, almost all the factories closed down in several places because Nigeria was a capital goods-importing country. So the moment you devalued the naira, the capacity to import the goods that we stored in our industries failed and so we entered a period of what I call de-industralisation.

“And de-industralisation means that all those that have been leaving school in the last 20 to 25 years have no jobs, because that devaluation of mid 1980s, in my opinion, led to the crisis in industry.”

Maku said prior to the devaluation, Nigeria was manufacturing goods, and had the Peugeot and Volkswagen assembly plants and was then moving towards local production.

He noted that with naira devaluation, the cost of capital goods went up and as such local manufacturing was no longer profitable as companies could not even sell at the value of manufacturing.

“So because we devalued our naira, the cost of capital goods went up, our industries crashed. Since that period up till now, Nigeria has been struggling, struggling; that is why we became a ‘Tokunbo’ nation.

“We were affording new cars before, but we have become a ‘tokunbo’ nation since that time because of this development,” he added.

“You had what we call the huge brain drain that has continued up to this moment and that brain drain affected the quality of education in our universities, in our polytechnics and higher institutions as well as other levels of education.

“That again created a new graduate class that no longer had the qualities of the 1970s in terms of training, in terms of capacity because the schools suffered also devaluation, so this compounded the problem.

“The entire workforce of the federal government, including the police, the paramilitary is not more than one million people and we are talking of a population of 167 million people, so the rest, where will they go,’ he queried.

The minister said, “In every country of the world, they (the unemployed) go into the private sector; into manufacturing, into industries; into the informal and formal sectors of the economy.”

But Babangida, through his media assistant, Kassim Afegbua, dismissed Maku as an unserious person with whom he would not join issues.

He asked: “Maku is just hallucinating. Did he (Maku) not criticise the proposed removal of fuel subsidy in 1988 as a student at the University of Jos?

“Does he maintain the same position today? Has he not shamelessly been saying removal of subsidy would be the best for the country against popular public opinion?”

Babangida said, “He can’t be serious. He is a product of double-speak just to keep his lousy job. We will certainly not join issues with him. He is too carried away with his saxophonist job to remember simple history.”

I concur,
but also Obasanjo's own version of SAP

OBJ devalued Naira by 500%

Err

Lol.

X-mind:

“Following the devaluation of the naira in 1986, by 1990, almost all the factories closed down in several places because Nigeria was a capital goods-importing country. So the moment you devalued the naira, the capacity to import the goods that we stored in our industries failed and so we entered a period of what I call de-industralisation.

So devaluation of currency led to deindustrialization and closing down of factories?

Dude doesn't know what he is talking about. . .

Anyway, whether IBB devalued the currency or not, Nigeria would still have done poorly, SAP or no SAP. When the only thing you produce of value (oil) plummets in price, you are screwed no matter what you do.

IBB probably could have done better, but to blame SAP alone for destroying Nigeria's economy doesn't make a lot of sense.

SAP was the tool that IBB and OBj used to destroy Nigeria

But of course SAP alone was not the only way they destroyed Nigeria - also massive out of control corruption / looting.

SAP or no SAP, if your country doesn't make anything, or the value of the thing it makes plummets, you are screwed.

Unless of course you've saved and invested the proceeds of the oil boom into something that will tide you over when the boom ends.

What is destroying Nigeria's economy is the POWER!! Fix the power to which means better schools and hospitals so better social well being. Also power for factories and housing. When people waste money on diesel then that is less money spent n the economy. Also roads, when people waste money fixing roads then that is less money in the economy.

Also stealing money and putting it in western banks instead of African banks. Instead of giving the politicians 150 million naira salaries give them less money and remove many of them. Use that money to give to companies to build factories and labs. This will create jobs, internal government revenue, forex, and raise the GDP.

It isn't that hard,

@igbo2011
your second paragraph is right on point.

sort out corruption and everything else would fall into place including Power. Our problem with Power is simply one of the symtoms of corruption.

IBB put the country in its current situation and has continued to do all he can to eep the country down since he left power in 1993.

many may not realise it but Abacha's government was starting to progress our country and again IBB intervene by poisoning him and re-installling the current stream of corrupt leaders, including his partner in crime Obj, who has buried the us.

Babangida and Abacha killed Nigeria. Babangida also introduced the rampant corruption we see today. When I was a kid, my dad would park the car on the road with the engine running and nothing would would happen, but not after IBB wrecked the country with his rampant bribery and deliberately destroyed the army and police (anything that was a remote threat).

^
so, IBB is the teacher of Patience Jonathan when she stole 109 million Dollars from Bayelsa? Nonsense.

Those of you blaming SAP for the state of living in Nigeria, have you ever actually picked up any document on the structural adjustment program and read it for yourselves?  

Have anyone of you ever actually considered sitting down, for a day or two, in your lives, to review the contents of the IMF website, on SAP, at least to ensure that all the stories you have heard on SAP and the conditions that come with the loans, are really in line with what you have been told and fed so far?

Babangida and Obasanjo killed Nigeria.

On the other hand contrary to popular belief, Abacha government was advancing Nigeria and we would have been in a better position today if IB had not intervened to poison Abacha and impose the likes of Obasanjo on Nigeria,

Kobojunkie:

Those of you blaming SAP for the state of living in Nigeria, have you ever actually picked up any document on the structural adjustment program and read it for yourselves?

Have anyone of you ever actually considered sitting down, for a day or two, in your lives, to review the contents of the IMF website, on SAP, at least to ensure that all the stories you have heard on SAP and the conditions that come with the loans, are really in line with what you have been told and fed so far?

Check this out: http://depot.gdnet.org/cms/grp/general/Nigeria_proposal.pdf

IMF/ World Bank/ WTO only serve developed countries. Ask Greece how those austerity measures feel. before the IMF gives any country austerity easures, they better give the country of their headquarters one. Their HQ is in Washington DC and they have 14 to 15 trillion of debt.

^^^^ Is English a problem? Are you sure you even bothered to read the document because it does outline some of the Nigerian Factors, many of which we are all aware of and allow daily, that continue to hinder successful implementation of many of the COMMON SENSE problems in the contract.

Are you blind there? You post for me a document that clearly shows you what the real issues remain and even hints at how to fix it . . . no direct blame put on the actual conditions suggested by the IMF, yet you somehow think you can twist in all so you can tell spew the same illogical babble that many who are grossly UNINFORMED on this, continue to?

@kobojunkie
http://www.whirledbank.org/development/sap.html
http://www.globalissues.org/article/3/structural-adjustment-a-major-cause-of-poverty

If you read the book Bad Samaritans by ha Joon Chang he refers to the World bank/ IMF/ and WTo as the unholy trinity. They have a one size fit all policy and that doesn't work for everyone. You can't just devalue every currency, cut education, and healthcare that will hurt many people. It makes imports more expensive and since Nigeria imports almost everything it would make things tough. If you export things then it would be good.

Look up the Argnetina monetary crisis of 2001. There were many riots and protests. The IMF made this happen. Argentina made it out by exporting soybeans. It was a hot commodity. The only thing nigeria exports is oil that we don't even control.

For countries like China, they have a pegged echange rate and many economist say that it is under pegged. It should be 4 yuan to 1 dollar instead of 6 yuan to 1 dollar. That is why Donald Trump said that the Chinese are cheating.

Why do you think Gaddaffi was trying to set up an African Monetary Fund? because the IMF are LEECHES!! They stick to you give you a lot of debt and you repay itwith cheap resources.

I know A LOT about economics. This is my subject that I study everyday and read books a lot about it. I know what I am talking about, it isn't a conspiracy theory.

igbo2011:

For countries like China, they have a pegged echange rate and many economist say that it is under pegged. It should be 4 yuan to 1 dollar instead of 6 yuan to 1 dollar. That is why Donald Trump said that the Chinese are cheating.

Why do you think Gaddaffi was trying to set up an African Monetary Fund? because the IMF are LEECHES!! They stick to you give you a lot of debt and you repay itwith cheap resources.

I know A LOT about economics. This is my subject that I study everyday and read books a lot about it. I know what I am talking about, it isn't a conspiracy theory.