Human suffering is more about emotions and perceptions than statistics and forecasts, says MONDAY PHILIPS EKPE.
As the Chief Economist and Senior Vice President of the World Bank, Dr. Indermit Gill’s public statements often reflect the official position of this influential institution. Recently, at the 30th Nigerian Economic Summit held in Abuja, he urged Nigerians to afford the ongoing economic reforms a timeline of 10 to 15 years to yield significant results. However, the response from his audience—a group primarily composed of affluent individuals—was markedly negative, both verbally and through their body language. If his direct address to this privileged class received such a backlash, one can only imagine the sentiments of the less fortunate members of society regarding a speech steeped in technical jargon.
Dr. Gill’s remarks didn’t surprise many. Over the years, Nigerians, much like others in developing nations, have grown skeptical of the recommendations from international institutions, particularly the International Monetary Fund (IMF) and the World Bank. They have witnessed how desperate countries like Argentina and Ecuador have spiraled into dire circumstances under the supposed guidance of these organizations, which have yet to highlight successful examples of their interventions.
The narrative commonly revolves around the IMF, World Bank, and similar entities being engaged by governments that have either mismanaged their countries’ socio-economic infrastructures or inherited such failures. These institutions then offer bitter or sugar-coated solutions, often laden with strict conditions. Acceptance of these solutions typically results in woe, especially for the marginalized. It’s an illustration of corporate entanglement, where only nations led by pragmatic and visionary officials manage to free themselves from this cycle, while others remain trapped. Whole schools of thought confirm that these entities are, quite frankly, tools created by advanced nations to maintain dominance over weaker countries.
For Nigeria, the struggle to break free from this cycle of dependency is not a new saga. Rewind to the 1980s—President Shehu Shagari’s administration mismanaged the economy significantly, providing a justification for military intervention. This was the infamous period marked by a task force on rice led by the late Alhaji Umaru Dikko. The economic turmoil, spurred by foreign exchange shortages, persisted even after Major General Muhammadu Buhari’s takeover.
When General Ibrahim Babangida assumed leadership in 1985, Nigeria faced desperate circumstances. The country was in dire need of relief, yet Babangida could not simply accept an IMF loan without national debate, highlighting the prevalent apprehension about such institutions—sentiments that remain unchanged even four decades later.
So, how relevant is this historical context to Nigeria’s current situation? Subsequent governments have had to navigate their relationships with these global financial giants carefully, given the prevailing skepticism. The current administration, however, has not demonstrated such caution. From President Bola Tinubu’s controversial statement in May 2023 declaring the end of fuel subsidies to the swift devaluation of the naira and other policies echoing World Bank and IMF ideologies, the administration seems undeterred by public concern. But while WB may endorse Tinubu’s initiatives, such approval does not equate to acceptance among those directly affected.
Regardless of its implications, Gill’s speech merits analysis. Notably, he outlined three key directives for Nigerian policymakers. First, he emphasized the need to prioritize the growth of the non-oil sector. While he commended the Central Bank of Nigeria for its focus on controlling inflation, he cautioned against actions that could rapidly inflate the naira’s value, potentially stunting non-oil sector growth. Given the public’s urgent desire for the recovery of their battered currency, his comments were likely to evoke disappointment.
Second, he called for measures to assist vulnerable households in coping with rising inflation and soaring prices. Nigerians are no strangers to high costs, but the current levels are unprecedented, significantly eroding purchasing power and highlighting the prevailing despair.
Interestingly, Nigeria’s Minister of Finance, Mr. Wale Edun, who was present during Gill’s address, took the same message of the need to protect the extremely poor to the G24 meeting on International Monetary Affairs and Development in Washington, D.C. However, discussions about social safety nets must translate into tangible actions. Edun’s remarks coincided with the IMF’s downgrading of Nigeria’s growth prospects from 3.3% to 2.9%, a reflection of the country’s ongoing struggles in critical sectors like agriculture and oil.
Back home, Nigeria’s predominantly impoverished population remains unimpressed by the discussions held in well-appointed conference halls abroad. They are caught in a cycle of enduring challenges that demand straightforward solutions. Citizens ask: What type of reforms bring the middle class to its knees, devastate manufacturing, hinder growth in essential sectors, and contribute to widespread hunger and hopelessness?
Gill’s final recommendation urged the administration to “make the economy more business-ready.” The public remains uncertain about the capabilities of those steering this crucial aspect of national life. Whether President Tinubu’s appointed experts can navigate the nation out of its current predicament remains to be seen. Gill concluded with the World Bank’s emphasis on statistics, highlighting that Nigeria faces immense job creation needs in the next decade, with over 12 million young people entering the workforce.
He noted that job creation would hinge on attracting significant domestic and foreign investment in the non-oil sector, which necessitates improvements in the energy grid, transportation, and security. Proper regulations for private enterprises must also be established, as failure to rise to these challenges could set back reform efforts across the continent. While the World Bank pledged its support, it is clear that the burden of navigating these economic reforms lies primarily on the Nigerian populace.
Tinubu and his administration may tout achievements such as increased revenue and private sector participation in oil production, but they must remember that the discussions surrounding implementation and sustainability continue. The overarching goal should be to restore hope to the Nigerian people quickly—their needs, not those of the World Bank or IMF, should be the focal point of government initiatives.
Dr. Ekpe is a member of THISDAY Editorial Board.
