₦airaland Forum

Nigeria is blessed.

Nigeria is blessed.

Nigeria is blessed.

God bless Nigeria

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BUSINESS AS A TOOL TO TRANSFORM SOCIETY

Dr Henrietta Onwuegbuzie

Academic Director, Owner-Manager Programme, Lagos Business School

Once upon a time, we used to say Nigerians loved life too much to ever become suicide bombers. We looked upon such acts as foreign stupidities only contemplated by people abroad. Alas! You and I know the reality today. Suicide bombing has become an almost daily occurrence in Nigeria, along with kidnapping and robbery.

How did we slide to the most undesirable situation in our beloved country? The yawning gap between the rich and the poor in Nigeria has been growing over the years, such that in spite of an emerging middle class, 69% of Nigerians (112.59 million)[1] live in poverty. For this impoverished majority, it makes no difference whether they are alive or dead and so they’re willing to do anything to relieve their hardship, even when it means death, if caught.

The pervasive mentality of thinking only of the well-being of one’s family, in spite of being surrounded by suffering, has further hardened this dangerous divide. As someone once said, “A few privileged people in an impoverished society are endangered species”.

How can we expect to be safe when there is deprivation all around us? Perhaps we are blaming the government as we read. The fact, however, is that each of us can make a difference!

Almost every country in the world is presently threatened by the menace of terrorism. This is what has led world leaders to begin to rethink business as usual. There is now a strong global trend towards fostering for-profit businesses with a social mission. These are businesses that seek to solve social problems beyond achieving financial returns. The commonly used terminologies to describe such business models include Impact Investing, Africapitalism, Sustainability, Responsible Investing or Businesses Acting as Agents for World Benefit.

Call it what you may, the overall aim is to ensure that social development does not lag behind economic growth. This ultimately leads to a better society and sustainable development.

Business can therefore become a tool to transform society when problems around us are conceived as a potential profitable business opportunity. Through business, many of us can actively contribute to improving our society. At LBS, we have made the perspective of business as a tool for transforming society a significant aspect of the training received by our participants, especially MBAs.

Our MBAs are required to start or create profitable business models based on pressing problems observed in the society. In the last couple of years, they have started businesses built around social problems and have discovered the magic of accelerated profitability, while enjoying the fulfilment of lifting others out of poverty and transforming lives. They have therefore transformed potential human liabilities into assets to the society through the various businesses they have started. A number of them have built businesses aimed at taking children off the streets into schools; fought malnourishment and preventable deaths by manufacturing high-nutrient low-cost powders; provided jobs for the physically challenged who supply labour needed for their businesses; started basic business learning in markets such as Oke-Arin and Computer Village, to teach basic book-keeping etc.

The MBA fair will be showcasing many of such businesses, with the aim of attracting investors, encouraging replication and therefore accelerating social transformation and inclusive growth. We aim to use business to create a safer society, such that terrorism and crime become unattractive to most.

Please join us on July 1 as we showcase these ideas and give you an opportunity to invest and partner with them to make a change, while making profits. We look forward to receiving you.

Lagos Business School

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The Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, has been named one of the 50 greatest leaders in the world by globally-acclaimed Fortune Magazine.

Occupying the 33rd spot on the list, the minister was recognised alongside the Liberian President, Ellen Johnson-Sirleaf; Catholic Pontiac, Pope Francis; Chinese President Xi Jinping; Indian Prime Minister, Narendra Modi; Bill and Melinda Gates as well as Facebook Founder Mark Zuckerburg and Apple Chief Executive Officer, Tom Cook.

In the latest edition of the magazine, the minister was described as “a fearless promoter of sound economic policies”, and was also singled out for working hard to usher in a decade in which Nigeria’s GDP trippled.
Fortune Magazine’s annual list celebrates men and women who are transforming lives in all spheres, including government, business and philanthropy.

In compiling the 2015 list, the magazine explained that it gathered advice from more than 24 of the world’s best minds. The leaders were judged by their actions within their professional domain, industries or governance.

“To make this roster, it was not enough to be brilliant, admirable or even supremely powerful. We set out to find singular leaders with vision who moved others to act as well, and who brought their followers with them on a shared quest.

“We looked for effectiveness and commitment and for the courage to pioneer,” the magazine said.
Okonjo-Iweala graduated from Harvard in 1976 and holds a Ph.D in Development Economics from Massachusetts Institute of Technology (MIT) – 1981.

As two-time Finance Minister of Nigeria, she has helped to lay a solid foundation for the Nigerian economy, which is currently the biggest in Africa at $510 billion.

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It must be a leadership at once selfless and public-spirited; a leadership able to combine ideas and power, intellectualism and politics.’ — Prof. Ben Nwabueze


I OPENED my copy of The Guardian last Monday, 20 February, and encountered refreshingly cheering news. On pages 53 to 61 were three invaluable documents, published by Dr Ngozi Okonjo-Iweala, Coordinating Minister for the Economy and Minister of Finance. The first was the breakdown of the subsidy savings for January 2012 allocated to the Federal, states, and local governments. The second was a breakdown of distribution of revenue allocation to the Federal Government by the Federation Account Allocation Committee. The third was the distribution of revenue allocation to state and local governments over the same period.

This action was in keeping with the minister’s promise when the Subsidy Reinvestment and Empowerment Programme (SURE-P) was inaugurated that the process of the implementation of the programme would be transparent and accountable. Even so, as I was carefully reading these documents, I turned over in my mind a television image in the heat of the ‘anti-subsidy removal’ battle last January. It was during the proceedings of the House of Representative Ad Hoc Committee on Petroleum Subsidy. Dr Okonjo-Iweala was being grilled by the committee members over her ministry’s role in the affair. One of them wanted to know how she felt knowing that the Jonathan government’s sudden decision to de-regulate the market for premium motor spirit had triggered nationwide protests resulting in the death of several Nigerian youths.

It was a tense and emotional moment. But then, Dr Okonjo-Iweala, a former Managing Director of the World Bank, is no stranger to tense and emotional situations, given the frontline role the bank has taken since the mid-1980s to restructure the economies of developing countries along more efficient market lines. Visibly distraught, Okonjo-Iweala explained that she was a Nigerian very much as her questioners, and that the suggestion that she did not fail the pain ordinary Nigerians were undergoing at that trying moment was, to say the least, grossly unfair. Usually cool, sober-headed, and urbane, the Finance Minister’s emotional defence of her position suggested a personality grappling with immense emotional and intellectual challenges; a public official deeply questioning the value of personal sacrifice and public service when those being served neither understood nor appreciated the depth and quality of the sacrifice.

All manner of false and frivolous accusations had flooded the daily newspapers and social media, casting doubt on the minister’s integrity and patriotism. It was said that she singlehandedly foisted the subsidy removal policy on President Jonathan and the Federal Executive Council. False. It was said she had threatened to resign her office if the President reversed himself on the policy. Patently false. It was even said that she was in secret league with the Managing Director of the International Monetary Fund (IMF), to turn Nigeria into a client-state of the Fund for the benefit of the Western countries. Yet another false story. In the heat of the moment, these stories, without the slightest morsel of truth, donned the toga of fact and further served to heat up the polity. Ngozi Okonjo-Iweala, at the receiving end of it all, found no brave and impartial interlocutors to speak up for the defence of truth and basic decency. Her outburst at the House of Representatives proceedings is therefore understandable.

And yet, there are deeper lessons to be learnt from this event. If nothing else, the unfair savaging of one of Africa’s finest finds, voted one of the world’s one hundred most influential public intellectuals by Foreign Policy magazine in 2011, by the Nigerian media illustrates the dilemma true and tested technocrats face when they elect to deploy their brains and skills in the service of the country. Public policy, properly understood, is all about a government making choices out of a limited menu of options. The benefit of certain policies, and the hard social and economic realities that inform them, are usually not obvious to the generality of the citizenry, who in any case are not trained to fully comprehend these matters. The situation becomes even more worrisome when the policy choice has to visit hardship on these citizens for the foreseeable future, before the gains begin to manifest.

This was the situation with the fuel subsidy removal policy. The fundament of the Jonathan government’s argument is that the removal of the subsidy would remove price distortions in that market and encourage private investors to build their own refineries, a process that would not only crash the price of premium motor spirit in the long term but also end the involvement of the government in domestic refining, an activity in which it has proved patently incompetent. Even so, the notion of government ‘having no business in business’, fervently promoted by neo-liberal intellectuals in Africa since the mid-1980s, need to be rebutted. Countries as diverse as China, France and Brazil have government-owned corporations that are not only efficiently run, but also return profits to the public exchequer. The case of Nigeria is different for two main reasons.

One, the Federal Government, having seized the country’s oil exports, the main source of external revenue, since the end of the civil war in 1970, has slowly but relentlessly transformed Nigeria into a rentier state where citizens are rewarded not because of their productivity but their ability to worm themselves into a vital government agency through which they proceed to appropriate their own share of the oil bonanza. Second, the very idea of ‘Nigeria’ and the social and political basis of the Nigerian state are still very much contested issues, assailed by ethnic, regional and religious forces. The consequence of this vicious contest, led in the main by amoral and uncultured elites, is that every government agency, no matter how obscure or inconsequential, becomes a terrain for struggle for public resources by private actors masquerading as ‘public servants.’ Looting, not efficiency and productivity, are given primary consideration. Why did the Nigeria Airways, Nigeria Railway Corporation, Nigeria National Shipping Line - the list of dodos is indeed endless – collapse? Quite simple actually – because the implacable combined logic of the rentier culture, and the raging battle to define and possess the Nigerian state, wormed themselves into these ministries and corporations and rendered them comatose. They were looted and ‘asset stripped’ by civil servants and their private sector collaborators and discarded.

The case for the privatization of these public corporations was therefore informed by the imperative of taking them out of the reach of thieving public servants and converting them into privately-owned businesses governed by impersonal market forces. Now, this is precisely when Okonjo-Iweala and her fellow technocrats encountered problems. Subsidy removal and privatization of public property, which invariably results in price increases and the massive transfer of wealth from public to private hands is a tricky business, and always results in resistance from a citizenry now used to low prices. The Nigerian case is further complicated when it is realized that since the country slipped into economic recession in 1982 following the end of the oil boom and the massive looting that attended the NPN-led Second Republic, no government in the country has succeeded in actually generating new jobs and improving the social and economic condition of the citizenry.

The Structural Adjustment Programme, designed by the IMF and imposed on the country by General Babangida in 1986, proved a colossal failure, unable to re-galvanize the real sector, industrialize the economy and create employment. Despite the advent of civilian rule since 1999, the rate of poverty has been rising, not decreasing. Over 90 percent of the populace now live below the official poverty line.

The Jonathan government, in deciding to remove fuel subsidies, designed the SURE Programme as an antidote to the trust deficit that had been built up over the years by a cynical citizenry who now know that most senior civil servants are in public service to feather their own nests. All monies realized, President Jonathan promised, would be transparently ploughed into road construction, health provision, and sundry social services in a process supervised by well-known Nigerians of impeccable repute. But the government had no anti-dote for the raging poverty in the land and how this would square with the inflationary spiral the subsidy removal would trigger, imposing yet new hardships on an already bedraggled citizenry. The government’s case was also not helped by the 2012 budget in which recurrent expenditure and lavish provisions for civil servants accounted for the lion’s share, thus providing ammunition for critics who rightly pointed out that the cost of governance was too high.

It is important that it be stated that neither the trust deficit nor the raging poverty in the land was caused by Dr Okonjo-Iweala. But she was called upon as the Coordinating Minister of the Economy to provide a miraculous solution to these obstacles in the way of the subsidy removal policy overnight. Her dilemma is shared by Dr Sam Amadi, chairman of the National Electricity Regulation Commission (NERC) and the officials in NNPC charged with growing the domestic gas market. For regular and adequate electricity and gas to be supplied to the domestic market in a peculiarly Nigerian condition where corrupt civil servants have signally failed to run public corporations profitably like their Chinese counterparts, the subsidy regime in these sectors has to go for private business to come in.

This dilemma of Okonjo-Iweala and Nigerian technocrats, saddled with political bosses unable to create the social conditions in which public support for tough policy decisions can be mobilized, actually began way back in 1972 when Abdul Atta, the brilliant ‘super’ permanent secretary in the Ministry of Finance in General Gowon’s administration took the country into OPEC and created the Nigerian National Oil Corporation (NNOC), to grow Nigeria’s share of oil profits and also pave the way for indigenous participation and control of the industry. The young NNOC went about recruiting brilliant and capable Nigerian technocrats knowledgeable in the intricacies of the industry. However, the patriotic efforts of these technocrats were subsequently sabotaged by the civil servants and politicians around Gowon who were not only anxious to protect the interests of the International Oil Corporations but also feather their own nests. The mess that is today’s NNPC has its origin in the bruising turf battles and corrupt practices of these actors, a struggle that actually precipitated the Murtala Muhammed coup of July 1975.

The media attacks on the person of Okonjo-Iweala is therefore as unproductive as it is wrong-headed. If anything, what should be the focus of public interest at the moment is generating a public debate on an appropriate development policy for Nigeria in these perilous times. The last time Nigerians had a proper debate of this sort was in 1985-1986 when Babangida seized power and asked for a public debate on whether the country should accept an IMF loan with its harsh conditions and if not, what the home-grown alternative should be. Nigerians overwhelmingly rejected the IMF package, but Babangida went ahead and implemented them all the same, with continuing gruesome consequences for a now impoverished citizenry.

Professor Ben Nwabueze, the great thinker and constitutional lawyer, has always urged that ‘the national economy be controlled in such a way as to secure the maximum welfare, freedom, and happiness of every citizen on the basis of social justice and equality of status and opportunity.’ I have always argued for an economic model and a development policy, founded on the Welfare State, that will secure these worthy goals. The present challenge is to generate enough public support, through the right mix of politics and deployment of intellect, to bring this about in our country.



*Dr Okonta is Coordinating Fellow, New Centre for Social Research (new-centre.org), an Abuja-based policy think tank.

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In some recent newspaper reports, the Coordinating Minister for the Economy and Minister of Finance, Dr Ngozi Okonjo-Iweala was quoted as stating before the Senate Committee on Appropriation that the Federal Government plans to cut the 2012 budget by N370 billion.

Such reports are not accurate. The minister did not cite the amount published.

What she did say is that in its efforts to meet the challenge of financing the remaining portion of the fiscal deficit of over N300 billion, government is adopting a combination of strategies. These strategies include the reduction in government expenditure particularly overheads and a more aggressive push on revenue generation.

In discussing the fiscal deficit, Dr Okonjo-Iweala also made it clear that there is an urgent need to take action in order to reduce the cost of governance and improve the overall health of the economy.

Paul C Nwabuikwu
Senior Special Assistant to the Coordinating Minister for the Economy and Minister of Finance

FEDERAL MINISTRY OF FINANCE

News Release January 31, 2012

SURE: 74,000 JOBS SET ASIDE FOR VULNERABLE GROUPS – OKONJO-IWEALA

Twenty percent of the 370,000 jobs that will be created nationwide this year under the public works programme of the Subsidy Reinvestment and Empowerment Scheme (SURE) will go to vulnerable groups including persons living with disabilities.

Coordinating Minister of the Economy and Minister of Finance, Dr Ngozi Okonjo-Iweala disclosed this at an interactive forum with the leadership of the Joint National Association of Persons Living with Disabilities (JONAPWD), in Abuja, on Tuesday led by National President, Mr Danlami Basharu.

According to the minister, the initiative is a product of President Goodluck Jonathan’s focus on empowering all willing and able Nigerians to contribute their quota to growing the country’s economy.

She directed the national coordinator of the public works segment of SURE to immediately incorporate persons living with disabilities into his programme and furnish her with progress report before a follow-up forum gets underway in six months’ time.

“By seeing and incorporating you into the SURE Programme, nobody is doing you a favour. It is in the best interest of this country that everybody gets an opportunity to contribute to its development and the society loses by excluding you or any other segment”, the Minister assured them.

Recalling the example of President Frederick D Roosevelt, the only American President to serve four terms in spite of living with a disability, Dr Okonjo-Iweala described his example as an “eloquent lesson” of the benefits that society stands to gain if people living with disabilities are given a chance.

Dr Okonjo-Iweala praised persons living with disabilities in Nigeria for their resilience in the face of enormous odd, adding that considering the difficulties encountered in daily life by persons living without disabilities, what some Nigerians living with disabilities have achieved so far can only be described as awesome and amazing.

She paid special tribute to the Governor of Nasarawa, Alhaji Umaru Tanko Al-Makura State and a member representing Dutse Constituency in the Jigawa State House of Assembly Hon Adamu Shu’aibu Jigawar-Tsada for proving through their victory at the polls, that physical disability is no barrier to what a person can achieve and described members of the association as representing “one of the most inspiring segments of the Nigerian community”.

The Minister also promised to pass on to the appropriate quarters the request of the association for disability-friendly Mass Transit bus scheme run by persons with disabilities, through the Association as a way to ease their transportation problems and provide them employment.

The Minister promised to take up the implementation of aspects of the Disabilities Act with the relevant authorities to ensure that persons living with disabilities are properly integrated into the SURE Scheme in response to requests presented by the association.

Paul C Nwabuikwu
Senior Special Assistant to the Coordinating Minister for the Economy and Minister of Finance

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