Sliding from too much money to too much debt

General Yakubu Gowon was reported to have said in his days as the nation’s military head of state that money was not Nigeria’s problem but what to do with it. But that has since changed, especially in the past few years. Now, the country is grappling with debts huge enough to sink a skyscraper.

According to the Debt Management Office, the external loan component of Nigeria’s debt as of June 30, 2021, stood at $33.47billion. When the $4bn Eurobond loans as well as the $16.23billion and €1.02billion loans recently approved by the National Assembly are added to the June figure, the total external debt of the country would be $54.87billion. This is in spite of the debt forgiveness which the administration of Chief Olusegun Obasanjo secured for the country in 2006. As an effect of the Everest-like debt, almost a third of Nigeria’s annual budget is spent on debt financing. With no clear provision made for generating resources to defray the debts, not only is the country headed back to the pre-2006 era, her ability to embark on programmes and projects that could improve the lot of her citizenry is seriously threatened.

But how did we arrive at this sorry pass? How did we transit from Too Much Money Street to Too Much Debt Avenue? Ours is a typical illustration of the story of a fool and his money.

Consequence upon our failure to judiciously deploy the money we made without much labour, our oodles of money became our source of endless sorrows. Too much money stalled our thinking and stunted our development as the nation engaged in a ballroom dance; one step forward and two backwards. The more money we made, the poorer we got and the more we borrowed. The more money we made, the faster our facilities failed. The more money we made, the higher the rate of unemployment rose in our country. The more money we made, the worse our education indicators got. Our abundant wealth choked us so much that it threatened to snuff life out of us.

Economists say a scale of preference becomes inevitable as a result of scarcity of resources. But Nigeria did not have any problem with scarce resources and subsequently did not engage in any ‘time-wasting and energy-sapping’ planning. The leaders did whatever appealed to them. It was governance by the rule of thumb. After all, money was not a problem. That is why development became haphazard. This explains why projects are routinely abandoned. In Nigeria, most projects are usually a product of exigencies, once the urgency of the need abates, they are abandoned, irrespective of the huge sums of money already expended on such projects.

The East-West road was conceived in 1972 by Alfred Diete-Spiff, then military governor of Rivers State, as a way of opening up the Niger Delta area. Almost five decades later, the expanded road is still under construction. The Ajaokuta Steel Mill, established in 1979, has gulped billion of dollars and, as of 1994, had reached 98 per cent completion. But 42 full years after work started on the project, the sprawling mill, which sits on 24,000 hectares of land, has yet to produce any steel. The Ikere Gorge Dam, built to boost electricity generation and agriculture in the South West, was fully ready by 1983. Despite everything being in place, the dam has never been utilized for its intended purpose.

Since 1999, efforts have been on to improve power generation in the country. The efforts resulted in the passage of the Electric Power Sector Reform Act, the forebear of the National Integrated Power Projects (NIPPs). The government of Obasanjo injected billions of dollars into the NIPPs, assuring Nigerians that their days of epileptic electricity supply would soon end. But nothing came out of the huge amount of money spent on the NIPPs as most of the funds were stolen, yet nobody is in jail for misappropriation of the funds. Succeeding administrations wasted no time in awarding fresh contracts for power generation before the facilities were eventually privatised. Even the current administration has put billions of naira into power generation and transmission, yet most Nigerians still resort to generators for electricity supply.

When the country was making serious money, leaders made it their business to steal, and they stole without qualms. According to reports of international agencies, the bulk of the country’s petro-dollar earnings in the last 50 years was stolen by members of the political class. They stole unabashedly and pillaged our resources heartlessly. They stole us blind and turned around to make a mockery of us, saying our poverty was a result of laziness. They went about with the airs of those doing us a favour by plundering our commonwealth.

Unfortunately however, the malfeasance in public office received the tacit support of the populace who egged on the thieving leaders because of the belief that no matter how much the leaders stole, there would still be money left and it would sooner or later be their own turn to steal from the national treasury as well. That emboldened those in public office to continue to steal. But now that the till is empty, where does that leave those applauding the kleptomaniac leaders?

Julian Castro was the keynote speaker at the Democratic Party’s National Convention in 2011, where he said something very profound. He said, “America didn’t become the land of opportunity by accident. My grandmother’s generation and generations before always saw beyond the horizons of their own lives and their own circumstances. They believed that opportunity created today would lead to prosperity tomorrow. That’s the country they envisioned, and that’s the country they helped build. The roads and bridges they built, the schools and universities they created, the rights they fought for and won—these opened the doors to a decent job, a secure retirement, the chance for your children to do better than you did.”

But the reverse is the case in Nigeria; the forebears consumed the wealth and left debt for their successors. They never saw beyond their own horizon and made no plan for the future. Instead of creating opportunities that would lead to prosperity, they wiped up all the opportunities and lapped up the prosperity.

That is the tragedy of our country; the tragedy of a country that had too much money but lacked any expressed value, thus piling up debts for coming generations as a consequence.


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