Nigeria: CBN Under U.S. Pressure to Devalue Naira- Sanusi

Agaju Madugba

18 March 2011

Kaduna — Governor of Central bank of Nigeria (CBN), Sanusi Lamido Sanusi yesterday said the federal government should be held responsible for the nation’s economic under-development arguing that government has continued to take the wrong policies leading to crass poverty in the land which in turn engenders civil unrests in parts of the country.

Sanusi who said he has been under pressure from the United States of America (USA) to devalue the Nigerian currency also warned government to be wary of certain proposals from the governments of the western world.

The CBN Governor spoke yesterday in a lead paper he presented at the Northern Economic Summit, in Kaduna during which Speaker of the House of Representatives, Dimeji Bankole, described the north as indispensable for the growth and development of the nation.

President Goodluck Jonathan, who also addressed the summit said: “This summit is a defining moment in Nigeria’s economic and political history.

“It is a time that calls for deep reflection. The summit will lay a solid foundation for the development of our great nation. This economic summit is significant not because it is organized by the north, it is the first major economic summit to be organized in this part of our country especially coming at a time in our history when we have just celebrated our 50th anniversary and a matter of weeks before our next general election.

“The north has never lacked visionary leaders who served the region and the nation. I will like to appreciate these leaders and many others.

“It is my sincere hope that the contemporary leaders of the region and indeed Nigeria will strive towards repositioning the north and working for the welfare and wellbeing of our people.

“The growth in our economy in 2010 was driven basically by the non-oil sector especially agriculture. There has also been an improvement in our crude oil sector made possible by our administration’s implementation of the amnesty programme in the Niger Delta region.

“It is gladdening to note that our external reserve has assumed an upward ride from 32.5 billion dollars in September 2010 to 36 billion dollars in February 2011”.

Tagged, “Agenda for Economic and Social Transformation of the North,” organisers of the summit said the programme was designed, among other things, to develop well-thought and properly articulated blueprint for restoring and placing the north on the path of rapid and sustainable socio-economic development.

Sanusi said: “When we talk about economic development, we are talking about redressing conditions of objective violence that has continued to bring about this subjective violence that we have continued to witness in Jos because we created an unequal society characterized by poverty, unemployment, lack of education and hopelessness of the people that make them take up arms against their neighbours and against the society.

“So, often we talk about the north when it is time for elections, when we are sharing political appointments, we talk about the north. When it comes to the issue of what affects the northerner on the street, we do not talk about it.

“Take simple statistics. If oil price goes up or down, if stock market goes up or down or banks collapse, everybody knows. How many people have the statistics of the number of industries in Kaduna for example that have been shut down in the last 20 years as a result of failure of government to provide power and infrastructure?

“How many people have the statistics of gainfully employed human beings who were walking in those factories who lost their jobs? And the number of wives and children they had who had to drop out of school or not able to get medical care because of failure of government to provide power which led to the closure of the industries and the loss of jobs.

“When 20 years later those children pick up arms in the name of religion or ethnicity or whatever, against society and we are surprised because we do not know that those children are the products of the system that fails to cater for them. “The problem of the north is an extreme form of the problem that faces the entire country and while we talk about the north, I think it is important to understand that a poor man in Nigeria, whether it is in the north of the Niger or the south is a victim of the same system and at the end of the day, those of us in the elite class, those of us in policy making whether you are from Kano or Kaduna or Bayelsa or Anambra, we are all together culpable and guilty and responsible for this problem.

“In 2005, poverty incidence in the north was placed at 64.8 per cent, the national average was 54. 7 per cent, in the south it was 42.8 per cent. Even 42.8 per cent for southern Nigeria is bad for country that is rich in resources.

“This was in 2005 and things have gone progressively worse. If you take some states in north eastern and north western Nigeria, if those states were countries of their own, they would be poorer than Chad or Niger.

“This is papered over by the national average if you take Borno and add Bayelsa or if you take Borno and add Lagos, it lifts up the average. Some of the states in the north are poorer than Niger, poorer than Chad, poorer than Cameroon.

“I have always said that if you have the right economic policies for the nation, every part of the nation benefits. Agriculture is 42 per cent of Nigeria’s GDP and the bulk of the arable land in Nigeria and the bulk of agricultural products come from the north.

“So, why is there a higher incidence of poverty in the north which accounts for 42 per cent of GDP? It does not need a genius to probably that we do not have the right agricultural policies and the problem is that agriculture in the north remains production.

“It is a problem that is consistent in our economic programmes. We have a country that has the 6th largest gas reserves of gas in the world and we do not produce our power. We are happy to have 3000 megawatts of power. Togo which is smaller than many states in Nigeria generates 3000 megawatts.

“Togo generates enough power for its use now and can export. Ethiopia which was at war not too long ago, by 2012 will be generating 4,000 megawatts. We are an OPEC member, we export crude oil and we import refined petroleum products.

“We are the world’s number one producer of cassava but we import refined starch. We have a large cotton belt stretching from Funtua, Gusua all the way to Biu in the north east and we import textile fabric from China.

“We have hides and skin and we do not have a leather goods industry. The Vice President is very passionate about PAN and the automobile industry but we can never improve on local content in the automobile industry if we do not produce flat sheets otherwise the only local content will be paint and water.

“Without flat sheets you cannot produce anything. Our problems started from the abandonment of national economic plans and lack of articulate vision on how to build an economy and when we succumb to something called market forces. We import tomato paste; we spent $1 billion last year importing rice. Why should Nigeria import rice? Is it that we do not have the land or we do not have the intelligence to farm? Or rice processing plants are high technology that is beyond the understanding of Nigerians?

“What is the reason apart from the fact that some people are making money importing rice? The most difficult battle that Nigerians have to fight is the battle of getting the leadership in Nigeria should understand that when America or the French or the English come to talk to us, we should only listen where there is a convergence of interest because they primarily serve their own interest.

If we can serve the interest of the Nigerian people and make America happy that is fine but beyond a point we draw a line and say sorry, if you cannot show me how this is going to benefit the Nigerian people I will not accept it.

“And you see it all the time. I have been having this debate over the value of the naira and people are giving me all sorts of equations and models they have built. You are telling me that a manufacturer who depends on imports who pays money for diesel, for generator, for security, who is just managing to survive will be better off if I make the dollar more expensive for him.

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