In recent months, there has been a coordinated campaign to heap Nigeria’s current economic problems on the erstwhile administration of former president Muhammadu Buhari (2015-2023). This is a strategy of damage control being pursued by some of the economic managers and media contractors of the current administration who lately realized that their Bretton-Woods policies have failed. Following the failure of the rash implementation of fuel subsidy removal and the floating of the naira, policies of the IMF/World Bank which Buhari rejected for eight years but were embraced by the Tinubu administration, Nigeria’s economy has been in the throes of miscarriage in recent months. These two policy changes are the critical cost-push factors that have caused Nigeria’s current spiralling inflation and the attendant economic woes.
The Buhari administration did not float the naira, and it left the exchange rate at N460: $1. It was not a perfect system, but it worked for Nigerians. Imports and exports still largely operated around the official rate. Custom duties were set at the official rate. Most Nigerian students abroad still went through the banks and paid fees at the official rate. Buhari stated categorically that he would not float the naira (see media reports from as far back as 2015/2016). The IMF and World Bank hated him for it. Many pro-Bretton Woods Nigerian economists/contractors and their media apologists/subcontractors hated him and abused him for eight years. They called him names. But Buhari said it was not in Nigeria’s interest, and he would not do it. He did not do it.
The Buhari administration did not remove fuel subsidy, and fuel was still selling at N187 per litre when Buhari left office. The pressure to remove fuel subsidy was enormous. A committee was set up by the Buhari administration in 2022 on fuel subsidy removal. The majority of the members of the committee said, ‘remove fuel subsidy’; a minority said ‘don’t’. Buhari looked at the committee report, examined the pros and cons, and said, ‘Nigerians have suffered much because of COVID. We will not remove subsidy. We must find a way around it.’ Provision was made in the national budget for fuel subsidy till the end of June 2023. There was a choice left for the Tinubu administration to either remove fuel subsidy or not remove it, and to make adequate arrangements to face and tackle the consequences of its decision.
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Following the fall in the international price of oil, the Nigerian economy started a downward slope in 2014, a year before the advent of the Buhari administration. The administration inherited an economy that was in decline and by 2016, the economy was in recession. States across the country were bailed out of financial insolvency on two different occasions by the Buhari administration. A number of them were not able to pay workers’ salaries for many months. But they were bailed out. In 2015, the Buhari administration gave N338 billion to 23 state governments across all geo-political zones to enable them pay workers’ salaries. By 2017, N1.75 trillion had been disbursed to the 36 states in what BudgIT described as ‘extra-statutory “bailout” fund’. There was recovery and stability in 2018-19 until the disastrous COVID-19 pandemic came.
Nigeria, like all countries of the world, was locked down for 6 months. People were not working, or were working less, but were collecting salaries. Millions of lives, businesses, and jobs were saved by uncommon government interventions primarily driven by domestic borrowing. It was a period of unprecedented national emergency and lives and businesses had to be saved first, and by all means. The COVID-19 pandemic and national lockdown precipitated another economic recession, which the World Bank said was going to be the worst for Nigeria in 40 years. But the Buhari administration exited the recession within a quarter. It was like a miracle! Things were difficult, but the economy was stabilised, and this came at some huge cost. By 2022, the bailout to Nigeria’s 36 states to enable them pay salaries and pension was in excess of N2 trillion. The Buhari-led Federal Government saved the states. It also bailed out many businesses across all geopolitical zones in the country. Nigeria managed and exited the COVID-19 pandemic better and faster than most countries of the world, the USA and the UK included.
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The EndSARS riots of late 2020 brought new economic difficulties to the country, and this was worsened by the Russia-Ukraine War, which badly impacted many countries of the world across Africa, Europe, and even North America. The USA, UK, and many countries of the world are still battling rising inflation from the pandemic and the Russia-Ukraine War. Nigeria’s economy was largely stabilised until the naira redesign mishap, following poor implementation by the Central Bank. By March 2023, however, the nation was on the road to recovery from that experience.
Even global actors like the IMF and World Bank who were spurned by Buhari on major economic policies attested to the impact of the Buhari administration on Nigeria’s economic development. The International Monetary Fund (IMF) in its April 2023 ‘World Economic Outlook’ report retained its growth forecast for the Nigerian economy in 2023 at 3.2%. The nation witnessed an economic growth of 3.0% in 2022, and that rate, in negative reckoning, was attributed to the Russia-Ukraine War, the aftermath of the COVID-19 pandemic, and rising inflation. Against Nigeria’s expected growth of 3.2% in 2023, the global economy was expected to fall to 2.8% in the same period, according to the IMF. Invariably, Nigeria was in a reasonably fair condition; the foundations for economic growth laid by the Buhari administration were beginning to yield results. There were liabilities for the incoming administration and the balance sheet was lean; but there were huge assets as well, and there was a stable economy to build upon! That is the nature of the business of government globally.
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Describing the Nigerian economy as ‘one of the most stable in Africa’, the IMF in April 2023 had stated that despite the global challenges of inflation, the conflict in Ukraine, supply-chain disruptions, and the lingering post-pandemic stress, Nigeria’s business climate had been stabilised through improved infrastructure, increased investments opportunities, growth-driven reforms, and the ease of doing business, among others. These are the legacies that the Buhari administration bequeathed to Nigerians and to the Tinubu administration.
Rabiu Yau Ahmed is Coordinator of The Buhari Truth Collective and can be reached at [email protected]
