Africa Confidential, Vol 6 No 20 –
After balancing political interests and restructuring ministries, the most urgent issue facing President Buhari is economic strategy
At his self-imposed eleventh hour, President Muhammadu Buhari submitted his list of 21 ministerial nominees to the Senate on 30 September. On 8 October, the Senate was to start vetting the names but it will not know the portfolios that Buhari intends to give to his nominees. That means that most of the questions will be about personal integrity and political loyalties rather the technical competence required in a specific portfolio (AC Vol 56 No 9, APC to lead with a leaner team).
The list is the outcome of a tricky political balancing act which has taken far too long – he was inaugurated on 29 May – but has at least succeeded in not alienating critical constituencies in the political and business worlds. In addition to the complexity of mediating among and sifting through the myriad interest groups which descended on Abuja to press their claims to run ministries, Buhari has been trying to restructure the government at the same time. Not only does he want a leaner government – the 21 nominees are likely to be the substantive ministers and the next 15, so far unnamed, will be the deputy or state ministers – he also wants to cut the ministers' scope for patronage.
That is why many of the boards and managements of state-owned companies have been reconfigured in the last few months. In theory, this should allow the new ministers to concentrate on their portfolios and public administration rather than dealing with the pressure to find jobs and contracts for their supporters.
Yet the biggest question about the Buhari government – its economic strategy or lack thereof – remains stubbornly and worryingly unanswered (AC Vol 56 No 16, Fighting graft, Buhari-style). A halting performance by Central Bank of Nigeria (CBN) Governor Godwin Emefiele on 5 October at the Financial Times Africa Summit in London failed to convince many of his fellow bankers. Emefiele, who has plenty of enemies in the governing All Progressives Congress (APC), insisted that the government's costly defence of the naira, using billions of dollars of foreign reserves and putting restrictions on the availability of foreign exchange, was sound economic policy.
On the sidelines of the conference, Donald Kaberuka, former President of the African Development Bank, said the dogged defence of the naira risked creating new problems rather than solving current ones: 'As the gap widens between the official rate of the currency and the parallel, you open up opportunities for arbitrage and corrupt rent-seeking.' Even the political argument against devaluation – that it would alienate town-dwellers and the middle-classes because it raises the price of imports – was wrong, said Kaberuka, because most of those imports would be coming in at the more expensive parallel market rate.
When and whether the government changes its line on the currency will emerge after the economic team is in place. Based on the structure of the state governments under the APC, the Finance Ministry portfolio is likely to be divided into two: firstly, with a minister in charge of bringing in and tracking all revenue that is due to the Federation Account, from export earnings, taxes, duties and investments, which would entail close cooperation with the CBN Governor on currency and interest rates; secondly, the minister – probably the national planning minister – would allocate the revenue to each government department and entity.
The likely innovation will be the introduction of zero-year budgeting: that means that at the end of every year, each department must return its unspent allocation to the Federation instead of trying to roll it over into the following year. Already Vice-President Yemi Osinbajo, a former Finance Commissioner in Lagos State, is taking the lead on economic matters and is seen as one of the competent technocrats in the government so far.
There are at least two possible candidates on Buhari's list who could take the finance minister's role: British- born Kemi Adeosun, former Finance Commissioner in Ogun State; and Udoma Udo Udoma, a lawyer and former Senator from Akwa Ibom who has held several company directorships. Meanwhile, for national planning minister we have heard three names suggested: Amina Mohammed, former Special Economic Advisor to the President and currently Special Advisor on Post-2015 Development Planning to the United Nations Secretary General, Ban Ki-moon; the former Governor of Ekiti State, Kayode Fayemi, who has also been suggested as Foreign Minister; and former Lagos State Governor Babatunde Fashola.
It seems that Buhari has had to grapple with the Federal Character provisions, which require one minister from each of the 36 states to promote regional diversity. Secondly, he has also had the directly contradictory input of the Transition Committee, led by veteran official Ahmed Joda, which advised drastically cutting the size of the government (AC Vol 44 No 13, Atlantic crossing). Then Buhari had to find a balance between technocrats and politicians. Additionally, he has had to consider equitable representation for the various parties that make up the APC, as well as find good candidates from states, mainly in the Niger Delta and south-east, where the previously governing People's Democratic Party (PDP) still holds sway.
Some of the delay was due to the search for candidates who could meet Buhari's demands for personal probity. He has also gone for candidates who have kept away from headline scandal but who have nevertheless lived in the less-than-perfect world of Nigerian politics.
Heading the political side of the list is a strong triumvirate of younger ex-governors: Fashola (Lagos), Rotimi Amaechi (Rivers) and Fayemi (Ekiti), who all made big contributions to Buhari's APC election victory as directors of Fund-raising, Campaigning, and Policy and Strategy respectively, are at its core. With the new Kaduna Governor Nasir el-Rufai outside but nearby, they will be influential voices in policy and governance.
They are set to work effectively with the respected Osinbajo to deliver on campaign promises and institutional reform. Yet Amaechi's appointment – depending on the powers of the ministry he is given – may prompt fresh tensions in oil-producing Rivers State, where his arch-rival, Ezenwo Nyesom Wike, engineered a victory in the recent elections which is now being tested in the courts. The trio of ex-governors have all made it through despite attempts to undermine their qualifications and probity.
Mentor and rival In the case of Fashola and Fayemi, these questions seem to have emanated from the camp of their mentor-turned-rival, Bola Ahmed Tinubu. They are perceived as tactical allies of Senate President Abubakar Bukola Saraki in his tussles with Tinubu, so the vetting of the triumvirate may itself become politicised. However, to defuse these tensions, Buhari nominated Tinubu's ally, Lai Mohammed (Kwara). As APC Spokesman, Mohammed has been a thorn in the side of the PDP for years. He now has the chance to bring his talents into government, most naturally in the Information portfolio.
The interest of the older generation of former PDP figures who worked with ex-President Olusegun Obasanjo (and indirectly, that of the former President himself) is underlined in the inclusion of former PDP Chairperson (2001-2005) Audu Ogbeh and more convincingly, Amina Mohammed (Gombe). Obasanjo chose her to help Nigeria to meet the UN's Millennium Development Goals. With extensive experience in grassroots development projects, she will be a key asset in maintaining strong support for the government in the north.
Ogbonnaya Onu (Ebonyi) has to help to win over the south-east, where the APC lacks traction, as well as to represent the former All Nigeria People's Party faction, which he chaired, in the APC. Former Anambra Governor Chris Ngige is the other key south-east representative. Despite his mixed record in office, he is perhaps the APC's biggest name in that region.
Emmanuel Ibe Kachikwu from Delta is a surprise inclusion, having already been chosen as the new Managing Director of the Nigerian National Petroleum Corporation. He is likely to become junior petroleum minister, taking the day-to-day running of the portfolio as Buhari has already said he will take the Oil Ministry himself. Kachikwu apparently lobbied for a policy role to push his ideas for reform of the oil and gas sector: these include privatisation of up to 51% of the NNPC's assets, including its four refineries. He was keen to go ahead with an early sale of the refineries but Buhari overruled this, we hear. The benefits of the new centralised control of the oil and gas industry is that it will make Buhari and Kachikwu directly responsible for reform and for ending the mind-boggling corruption in the sector: if that doesn't happen, Nigerians will quickly draw their own conclusions.
However, it makes it all the more important for the government to establish an independent regulatory authority for oil and gas, with full access to independent and detailed audits, to monitor the management of all the NNPC and corporate operations, both national and international, in the country.
Lieutenant General Abdulrahman Bello Dambazau (Kano), who has a British doctorate in criminology, was Chief of Army Staff during the delicate presidential transition from Umaru Musa Yar'Adua to Goodluck Jonathan. He represents not only an old-style military establishment keen to restore the army's prestige but the northern elite itself. It would be a surprise if he were appointed to any ministry other than Defence or perhaps Police Affairs.
Senator Hadi Abubakar Sirika is a long-time associate of Buhari's from his Congress for Progressive Change party and home state of Katsina. Aisha Jummai Al-Hassan narrowly missed out on being Nigeria's first female state governor in Taraba in the polls earlier this year and has a federal appointment as consolation. Nasarawa technocrat Jibril Ibrahim is one of the least 'political' choices, with a long history of technical achievement in surveying and administering land and property titles in the Federal Capital Territory and nearby. Abubakar Malami (Kebbi) is one of six lawyers on the list, alongside Oyo's Adebayo Shittu, Plateau's Solomon Dalong, Udo Udoma, Fashola and Al-Hassan, and could be a candidate for attorney general if the idea of fellow Senior Advocate of Nigeria Fashola as the country's chief prosecutor prompts too much protest from Tinubu.
However, the Federal Character algebra also leaves some possibilities out, which is of special concern when it comes to the under-weight economic team. Unless some states get two ministers, the talented and widely-tipped former Federal Inland Revenue Service Chief Executive, Ifueko Omoigui-Okauru, is marked out of the game by the inclusion of orthopaedic surgeon Osagie Ehanire from the same Edo State. In the same terms, Kachukwu's inclusion lessens veteran economic commentator Pat Utomi's chances of representing Delta. Then Ngige's appointment for Anambra slims the chances of former CBN Governor Charles Soludo, who had been a vocal critic of former Finance Minister Ngozi Okonjo-Iweala. Udoma's main value may in fact be political: as a PDP floor-crosser he can trump the most effective and well-funded opposition figure, Governor Godswill Akpabio, in his home state.
With portfolios yet to be allotted and at least 15 slots yet to be announced, a lot is yet to emerge. Those slots left empty for now include Kogi and Bayelsa, where hotly-contested state elections will soon take place and where ministers may be chosen in the light of the results.
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At last a cabinet, and now for the policies
Africa Confidential, Vol 6 No 20