JONATHAN MUST FIX NAIRA EXCHANGE RATE TEN TO THE DOLLAR
(WE ARE ABYSMALLY POOR AS A PEOPLE BECAUSE OF THE RIDICULOUS NAIRA EXCHANGE RATE TO THE DOLLAR)
There are four main activities Goodluck Ebere Jonathan must tackle robustly before the end of his tenure as Acting President:
(1) Jonathan must begin to systematically increase monthly, our electricity generating capacity from its current level of about 4,000 mw to, at least, 10,000 mw by December, 2010.
(2) Jonathan must fix the naira exchange rate at ten to one US dollar right away and not later than in the next three months.
(3) Jonathan must put right the Niger Delta problems at least along the lines already mapped out by the government.
(4) Jonathan must ensure credible, free and fair general elections next year.
When Prof. Soludo, as Governor of the Nigeria Central Bank, fixed the naira exchange rate at ten to one dollar at the beginning of Yar'Adua's regime, Yar'Adua vacated the decision out of economic knowledge ignorance and misplaced selfish pride about not being consulted before the decision was taken by Soludo.
Ghana reversed her debilitating downward poverty slide by fixing the cedi exchange rate at ten to the dollar some four years ago. Ghana unlike Nigeria, has minimal problems generating her nominal electricity requirements. So, today, instead of Ghanaians rushing to Nigeria to look for work, Nigerians are invading Ghana to attend schools and deal with basic economic survival needs.
There is nowhere in the developed world where market forces are allowed to fix the exchange rate of the local currency. All the leading economies of the world fix their currencies' exchange rates and allow market forces to play within rigid parameters up and down such limits and when market forces seem to be having the upper hand, the government declares economic state of emergency. This happened recently with the economic meltdown. Leading economies of the world, including the US and Britain, reined in their market forces to respect national economic ethos and priorities.
Exchange rate issue is, therefore, a political decision which the government of a country takes to determine the level of poverty it can legitimately and morally tolerate amongst its citizens. Babangida downgraded the naira exchange rate by fiat from two to sixty to the dollar in one swoop to deliberately pauperize the citizens and make life too difficult for them to be able to challenge his ambition to be president for life. To reverse our slide deeper and deeper into the bottomless pit of poverty, the exchange rate must be fixed by fiat also, and held within sensible limits for economic forces to speculate in as necessary.
Babangida pretended to allow a debate on IMF's SAP programme. The masses rejected the IMF programme but Babangida went along with the IMF programme all the same by instituting what he described as his own version of SAP. Babangida's SAP re-launched our re-colonization in earnest. His leading architects of his SAP were two World Bank and IMF trained experts. Chief Idika Kalu and Chief Olu Falae who argued that our economy would collapse without SAP. Our economy promptly collapsed despite SAP.
Babangida's SAP protagonists told us that we needed to increase our foreign currency earnings to be able to pay our strangulating foreign debts, import more goods and, of course, technology that use foreign raw materials and spare parts to stay in operation. SAP, we were told ensures increased foreign exchange earnings by liberalizing trade and (scandalously) marginalizing the naira to enhance our export capabilities. Sheer jargon because, the liberalizing business turned out to be a one-way trap. A vicious circle in effect, encouraging us to export more at low prices to import more at high prices because foreigners dictate the prices and no matter what we do, we always end up the debtors.
Our IMF African gurus argued further that after all, the Japanese yen is 120 or so to the dollar. What they concealed from us is that Japan is an export dependent country. They have no raw material. Their export is totally based on what they manufacture. They sell cheap to compete. They fixed the yen deliberately that way from inception, with local values in mind; same way as a hundred British shillings was fixed to produce one pound. In other words, the yen was worth about a shilling relatively from start. The yen didn't just jump overnight from 1 to 120 to the dollar as African economies were forced to do by the IMF? When the yen wobbles a fraction or two downward in strength, the Japanese government panics and moves close to declaring a national emergency. In general, the yen gets stronger against the dollar yearly and the current projection is that it would exchange 115 to the dollar two years from now.
It would be a miracle if the naira has not jumped from its current 150 to a new rate of 1,000 to the dollar by then because it volts abnormally downward only.
That is how the Ghanaian cedi catapulted to 9, 060 to the dollar in thirty years. The government could hardly pay teachers salaries. They collateralized their gold mines to the West to keep afloat. Without regular foreign aids and donors support, budgets would not balance yearly. So, some four years ago, the government fixed the cedi exchange rate at ten to the dollar and their economy has been looking up since. The citizens are happy and foreign investments have begun to come in.
The foreigners we are trying to pacify with our ridiculous exchange rate are not investing in the Nigeria economy. Of course, they are grabbing our forced privatized parastatals like the airways, power and steel, oil, mines, communications to consolidate their control mechanisms and our total emasculation. Why should they invest in the other sectors to earn our worthless currencies?
No one needs to bring money from abroad to do business in Nigeria; rather Indian and Lebanese traders are operating illegal private banks from several bases around the country. Some of the bases in Apapa, a suburb of Lagos, Nigeria, for instance, are well known to the security personnel who even patronize them. The foreigners have no respect for our laws because they are fronts for our leaders and retired generals and where that fails, they can buy off law enforcement agents. Indians and the Lebanese are printing the local currency (naira) illegally to buy up privatized industries and our hard earned dollars to send home.
During the week-ending 24th June 2001, a senior government official (Chief Bode George) who was the Chairperson of our ports announced (and as expected quickly denied it the following day) that five container loads of Nigeria's new N500 notes were impounded at the Apapa ports by the Nigerian customs. That kind of money (obviously in trillions of naira) would be enough to wipe out Nigeria's hundred years oil sales revenue in one swoop and oil is the mainstay of the Nigerian economy. The illegal currencies were reported to be as good as our genuine ones and the owners would have been in a position to pay a thousand, two thousand or even a million naira of it to buy a dollar. Even if they spent one million dollars to print it, they could buy millions of dollars with it to take out.
The only group of people making it, apart from the foreign manufacturers exporting obsolete products to us and the Indian and Lebanese crooks in our midst; are our banks round tripping on the exchange rate scheme; retired rogue leaders living off their loot; senior government officials siphoning our resources into their private accounts abroad; their relations favoured with plum government contracts that are paid for without performance; drug barons and the 419 (con-men) kingpins. Nothing productive is going on right now in our society. We still import everything from sand, toxic waste, European excrement as fertilizers, toothpicks and broken bottles just to earn the opportunity to export dollars. The middle class has been completely wiped out. All we are left with are the rogues and the very poor.
The people determining the exchange rate are, of course, the rogues from the unproductive sector of the economy. They are the ones with access to bank's bidding facilities for foreign exchange allocations. These are armchair opportunists working off their briefcases. They don't employ staff, need office accommodation or pay taxes. Every naira they corner, they convert into dollars immediately and transfer abroad.
These are the people determining the fate of the exchange rate courtesy of the IMF and the World Bank. The ordinary everyday Nigerian worker, doctor, lawyer, teacher, secretary, market woman, taxi driver, roadside mechanic etc do not make any contribution to the determination of the value of the naira. And yet, they work very hard, so hard that they are the most stressed people in the world, just to earn N100 a day to buy less than a dollar's worth of value.
It takes less than five seconds for the average worker to earn a dollar in the USA but the Nigerian needs to work a day or two for it because the West wants him to remain ever dependent on them. Today, you need to work 150 times as hard in Nigeria as you would in the USA to earn a lousy dollar. It is the dollar that determines the value of local products. Every one is calculating prices by it, traders, contractors, prostitutes, since the government trades with it and values it more than the naira, thanks to the IMF and the World Bank. A whole day's wage (which is five seconds wage in the USA) can only buy two jerricans of garri now or four ripe plantains. How can that be value for labour and for exchanging the naira? No one can feed himself and his family that way. Not all of us have jobs so, a day's work for a lousy meal a day per person is sending all of us to our early graves.
Economic experts from around the world often paraphrase their economic theories with: “all things being equal.” Our IMF and World Bank trained African financial wizards interpret this with their heads buried in the sand because it is obvious even to the most illiterate person that all things are not equal in African economies. We are often one-export product economies. The buyer insists we drastically devalue our currencies because that is the only way we can compete. Compete to do what? We do not manufacture anything. They would not allow us and when they do, they say ours are substandard and put all sorts of regulations to bar our entry into their markets. They have cartels like the EU. They insist we throw our markets open, the world trade trick, and flood us with so much of their junk and rejects, we don't have time to think of competing anyway.
All we have to sell of our own are raw materials and they fix prices and pay in their currencies. They force us to trade in their currencies. Our governments, banks everybody trades in the foreign currencies. The local currencies respond by continually falling in value (like a discarded bride) to catch the scarce “real” money coming from abroad.
Nigeria, for example, after paying over US $40 billion (N54 trillion) over the years, was still owing $34 billion (N46 trillion) in 2005 for a debt of $19 billion (N11.7 billion) made up largely of interests and penalty charges in 1985, so who is the fool, the IMF and the World Bank or Nigeria? The latest we hear is that the Paris Club and the IMF have tricked Nigeria into parting with US$12.4 billion in virtually one swoop from her recent oil windfall to close the books on the US$19 billion debt that had already consumed over US$40 billion in payments to the Paris Club. At the rate they are manipulating us, we would continue to be indebted to our colonial masters for another one million years even if we never borrowed a dime from them again.
Because of the gross marginalization of the naira, our economy is comatose. Most factories have closed down. The few still in business are operating at below 20% of installed capacity, resulting in massive unemployment. Warehouses are full of unsold goods. All our infrastructural facilities have broken down. It is too expensive to replace them or buy spare parts. Hospitals have no drugs and no new hospitals are being built. Nurses are not being paid on time and receive pittance when paid. Doctors have become government contractors to survive, neglecting their professional callings.
Our educational system is in shambles. When not closed down, there are no books or teaching aids. They are too expensive to procure. No one can afford to buy books and no one is reading except the Bible and the Koran, which are dumped in millions of copies on us free of charge to keep us ever illiterate and subservient to them. Most teachers have even migrated abroad to more lucrative jobs. Thousands of our youths are unemployed and thousands more waste away at home because schools are closed for a year for every month they open. The most actively pursued business by Nigerians right now is the visa to jump out of the Nigerian sinking ship.
Social services are nothing to write home about. Roads are impassable for potholes and floods. We queue for days on end to buy petrol wasting otherwise valuable man-hours in the process. We have no drinking and cooking water in most homes, no electricity generally for months at a time and yet the authorities are threatening to increase their tariffs.
Telephones are a luxury, they are not for the poor, remarked David Mark when he was Minister of Communications in Babangida's regime and yet telephones are unreliable. The rogue elite minister, with one of the world's best gulf courses in the US, wakes up one morning as communications boss and jerks up telephone tariffs by some 700%. Why should our leadership hijackers care if the poor are eating from the dustbin? It is our fate. We are eating something anyway, so telephone companies bleed us dry over epileptic, low quality services.
The typical Nigerian family on a monthly salary of N5,000 spends upward of N3, 000 a month on GSM tariffs (which currently are the highest tariffs in the world) and that is only by perfecting the flash, call me back, and SMS text cultures. People unable to feed themselves or their immediate families, or pay school fees or house rents are going about begging for loans for GSM credit vouchers. It costs a day's average wage to post an ordinary letter by air abroad and still the letter gets stolen or tampered with before destination.
We are under severe siege as a people thanks to the IMF and the World Bank's marginalization of the naira. Fear now rules our daily lives. Ugly, harrowing fear of the known and unknown. When we go out in the mornings, we are not sure we would return home safely and with our cars, bikes and other properties, including even the shoes on our feet or the earrings in our ears. If we are lucky to arrive to find our homes unraided in our absence, we sleep with one eye open expecting the worst any moment of the night. In other words, we do not sleep any more, and psychologists must have a thing or two to say about the consequences of lack of sleep on our ability to perform daily chores. The orchins controlling our lives are no longer the illiterate, no-good, lay-abouts of yester-years but generally smart looking, well educated and spoken people who could pass any day for bank executives. They are graduates of our higher educational institutions unable to find employment for as many as 8 to 20 years.
Societal values have completely broken down. Marriages are dissolving as soon as they are contracted. Children have lost respect for their hapless parents who can neither protect them nor provide their basic needs. Hard won earnings can no longer buy simple everyday necessities of life, not even garri, our staple food, let alone encourage us to aspire to own a car or a home in a lifetime. Many wives are prostituting to help families make do with the one measly meal a day now available to only a few in society. Many of our daughters leave their university dormitories at night to hawk their bodies to pay school fees and feed. The boys hold up banks, petrol stations during daylight and whole communities at night in convoys and formations reminiscent of military operations, all to make ends meets.
Armed robbers kill just for the fun of it and to watch us agonize in pains. Dead bodies are everywhere. On the streets and in open graves, deliberately piled in sadistic heaps to poison the atmosphere. Lying, cheating, pulling tricks have become virtues and friends and neighbours are usually the first casualties. No one and nothing is spared in the new culture of destruction instigated by the World Bank and the IMF. Suicides have become common place and obituaries are largely about people in their 30s to 50s. The supposed productive age in society.
NAIWU OSAHON, Hon. Khu Mkuu (Leader) World Pan-African Movement); Ameer Spiritual (Spiritual Prince) of the African race; MSc. (Salford); Dip.M.S; G.I.P.M; Dip.I.A (Liv.); D. Inst. M; G. Inst. M; G.I.W.M; A.M.N.I.M. Poet, Author of the magnum opus: 'The end of knowledge'. One of the world's leading authors of children's books; Awarded; key to the city of Memphis, Tennessee, USA; Honourary Councilmanship, Memphis City Council; Honourary Citizenship, County of Shelby; Honourary Commissionership, County of Shelby, Tennessee; and a silver shield trophy by Morehouse College, USA, for activities to unite and uplift the African race.
Naiwu Osahon, renowned author, philosopher of science, mystique, leader of the world Pan-African Movement.