10 challenges facing Nigeria’s new president

Gen Muhammadu Buhari. PHOTO BY AFP

ABUJA- Retired Gen Muhammadu Buhari defeated incumbent Nigerian president Goodluck Jonathan in a tightly-contested election earlier in the year. Below are some of the top challenges the new leader of Africa’s most populous nation faces:

1. Too much oil, not enough fuel
The crisis caused this week by fuel shortages will make this the topmost item in Gen Buhari’s in-tray, but the problems in Nigeria’s oil and gas industry are more fundamental.

Nigeria is among the top 10 oil producers in the world and Africa’s leader, pumping 2.5 million barrels of oil out of the ground every day.

It is also one of the leading importers of petroleum products because its four refineries have long been run down through corruption and mismanagement, leading to an inefficient and wasteful subsidy system behind the regular fuel shortages.
Gen Buhari must find ways to divert the wasteful fuel-import subsidies into refurbishment of Nigeria’s oil refineries and sell some government stakes to bring in foreign investment and technical know-how.

2. Powered by generators
The fuel shortages this week exposed another chronic energy security problem in Nigeria: the country is powered by generators. A regular soundtrack to the hum and din of Nigeria’s cities is the diesel symphony of millions of generators purring away, powering everything from lights to water pumps to air conditioning units.

A quick solution to more stable power supply is to set up heavy thermal power plants fed by the country’s oil, but the power grid is in need of refurbishment and investment.

Official figures show that Nigeria requires about 40,000 megawatts of electricity for its population of more than 100 million.

It only produces a little more than 3,000 megawatts and this dropped to less than 1,200 megawatts during the recent crisis as 18 out of the 23 power stations were forced to shut down for lack of fuel.

3. Boko Haram Inc.
The high level of insecurity since 2009 had become worrisome, starting with the menace of Niger Delta militant groups, but the Boko Haram insurgents in the north east have turned insecurity into a national crisis with terror attacks across the country.

As a Muslim leader from the north and with a military background, Gen Buhari has the credentials to get the Nigerian military back into fighting shape and seize the initiative against the insurgents, who have killed upwards of 10,000 people in a few years.

Rescuing the 200 girls captured from Chibok will be a psychological victory, but stamping out extremist views will take a lot more firepower and smarter anti-radicalisation policies.

4.Corruption
Many Nigerians complain about being stereotyped over corruption, and with some merit; you are more likely to be hacked by a Bulgarian or Russian gang.

However, Gen Buhari acknowledges that corruption is a big problem in Nigeria, as does Transparency International, which ranks only 39 countries out of 175 as being more corrupt than Nigeria.

Gen Buhari has promised a crackdown, but as a civilian leader, he is unlikely to resort to the executions he ordered against corrupt officials in his 20 months in office as a military dictator from 1983.

A good place to start is the $20 billion that former Nigeria Central Bank Governor Sanusi Lamido said was stolen from the country’s oil revenue account. The figure is contested; the extent of graft is not.

5. Education’s missing children
As with many African countries, Nigeria’s public education system is wobbling under large numbers, poor policies, poorly paid teachers, and poor facilities. Many move their children to the mushrooming and expensive private schools as soon as they can afford it. Most of the country’s 69 federal and state universities and institutions of higher learning are full.

Of the more than 1.4 million qualified candidates who write the matriculation examination yearly, fewer than 230,000, or less than two in 10, are placed.

6. No jobs
Thanks to the high drop-out rate, an education system that produces graduates ill-suited to the job market, and an economy growing without producing enough jobs, unemployment has been on the rise in Nigeria for many years.

This has been exacerbated by the lack of deliberate job-creation programmes; a high cost of doing business that has forced the relocation of industries, and non-payment of contractors.

The unemployment figure has been put at between 20 million and 24 million – about the entire combined population of Benin, Gambia, Gabon and Togo.

7. National debt
When the previous government took power, it inherited zero national debt. It leaves the country with more than $30 billion debt, according to Finance minister Ngozi Okonjo-Iweala.

This debt is likely to expand further as the government invests in energy and transport infrastructure, but Gen Buhari must make earlier investments work to provide the tax revenue the government needs to repay its creditors.

8. Big economy, small base
Gen Buhari needs to find a way to wean Nigeria off oil and gas which account for more than 90 per cent of the total export revenues and 70 per cent of the tax revenues.
The recent slump in world crude oil prices has hit Nigeria’s tax revenues, export earnings and national reserves hard, and contributed to the Naira sliding from N160 to N221 to the dollar since November 2014.

To cure Nigeria’s Dutch disease, Gen Buhari must force through reforms to attract investments in the agricultural, services and manufacturing sector. The new government must use oil as the means to, not the end of, economic growth.

9. Big country, bloated government
Gen Buhari must find ways to cut down the size and cost of public administration. A mismatch between revenues and expenditures has seen 28 out of the 36 states fail or struggle to pay salaries.

Some 70 per cent of the Nigeria’s budget is devoted to recurrent expenditure, most of it wages. Although the country presently has 42 ministers for its 22 ministries, these are swollen by large retinues of aides, assistants and other political appointees.

In a megalomaniac society such as Nigeria, it is hard to think of a lean and efficient government, yet that is precisely what the country needs to work its way out of its difficulties.

10. Sleeping African giant
Finally, the Gen Buhari administration must take Nigeria’s rightful place alongside South Africa at the head of the African table. The country has long punched below its weight on continental issues.

With South Africa showing signs of uncertainty and hamstrung by a xenophobic outlook by some of its people towards the rest of the continent, Nigeria has an opportunity to emerge as the leader among African nations.

With the right diplomatic outreach in Ecowas, SADC and the East African Community, Gen Buhari might find that his election as President of Nigeria gives him a platform to shape continental policy. Africa is watching him and his government.

Africa Review