Resetting Nigeria through policies

There can be no better way or route to correct the shortcomings in Nigeria right now except through policies. Nigeria has been primed for a reset for quite some time. As a system that has malfunctioned in the past, or one that is operating sub-optimally, Nigeria is due for a reset. Only great policies can […]

There can be no better way or route to correct the shortcomings in Nigeria right now except through policies. Nigeria has been primed for a reset for quite some time. As a system that has malfunctioned in the past, or one that is operating sub-optimally, Nigeria is due for a reset. Only great policies can produce the change needed to put the country back on the path of growth and development.

All the challenges confronting Nigerians right now are products of either the absence or failure of policy. Take some of them, for example: pervading poverty level; lack of or inadequacy of infrastructure; polarisation of society, and hunger. Others include the dearth of social services, and our decrepit health and educational sectors, among others. Each of these problems originated and has grown over the years from the fertile grounds created by policy misapplication or absence.

The truth is that there is no shortcut out of the quagmire. It is not going to be a dash, nor will it be a sprint. There has to be critical thinking; there has to be interrogation of the existing structure that produced this Augean stable that of necessity be cleaned.  When policies fail or are wrongly applied, they produce unintended consequences. It could even be worse in a policy vacuum, where there are bound to be crises because there is no framework within which problems can be analysed and tackled.

I have always argued here and elsewhere that the kind of social strata that exist in a country is by the choice or predilection of those who have had the opportunity to preside over the affairs of the nation. Leadership dictates the direction of the flow of resources, and the flow of resources determines the economic status of a majority of the people. Whether people have access to resources or are destitute is more of a political decision than any other.

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Policies are not just sets of sterile figures or diagrams and arrows spread across realms of papers or computer screens.  Policies are arguments: their framers make claims by stating their overall objectives. They say or show what should be done to achieve those goals, how it should be done, why it should be done, by whom, and, most importantly, in whose interests it should be done. Without these elements being embedded in policies, economic management, or any management at all for that matter becomes mere guesswork. In such a milieu assessing the achievement of objectives becomes almost indeterminate because the determination of progress is not feasible. This is why policies are great reset buttons that change the way systems work or should work.

Where there are no policy frameworks to guide the execution of government actions, public-sector activities end up as directionless motions or just fruitless efforts.  As arguments, policies show with evidence how or why doing things in a particular way could yield better results than what has been achieved in the past by doing them differently.

A week ago, questions were hanging over the Dangote Refinery. Who wanted it to fail? Or, who was in support of the gigantic project? Between last week and Monday, two days ago, the plant grew in value and the source of that growth is policy.

On Monday, the Federal Executive Council at its meeting presided over by President Bola Tinubu, decided that the Nigerian National Petroleum Company Limited should sell crude oil to Dangote Refinery and other refineries in the country in naira, instead of the US dollar. That was a significant policy move with the potential to change the long-standing ugly narrative about the Nigerian oil and gas industry, especially the supply of refined petroleum products.

As an argument, that pronouncement came with a claim that selling crude oil to the Dangote Refinery will create value for Nigerians higher than what they have been able to enjoy so far. In quantitative terms, the government said doing so would save the country about $7.3 billion. Besides that, analysts have identified further benefits accruable from this policy. It will potentially lead to a reduction in the price of refined petroleum products. It also can eliminate the perennial shortage of petrol and other products (as the country is experiencing right now). These are features of the Nigerian society that have dwarfed our status in the eyes of the world: how a country so endowed with oil and gas cannot refine its crude oil at home and enjoy the benefits of doing so.

The policy also identified those who will undertake specific actions for the purpose to be achieved. In this case, rather than passing through a long process of Dangote Refinery having to open Letters of Credit to place orders for the crude oil, the announcement created a bypass to avoid this process.

That responsibility is left to the pan-African financial behemoth, Afreximbank, and other settlement banks operating in Nigeria to make possible the trade between the two entities – Dangote Refinery and NNPCL, thus eliminating the need for LCs in the transactions.

These are just examples of the benefits of driving institutions, systems, and economies through policies. It forces us to think. Thinking through issues is the way out for Nigeria out of the multitude of problems confronting us now.