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Segun Aganga: Ten Months After

By Dr. Jideofor Adibe, London, UK – Feb. 2, 2011 – Finance Minister Segun Aganga is a very brilliant man. You do not become a managing director of Goldman Sachs, a leading investment banker in the world, for being stupid. And for a Blackman to have become so in the United Kingdom – an essentially White world – meant there must have been one or two things going for him besides his obvious academic brilliance.

When he was appointed Finance Minister, some Diaspora Nigerians proudly appropriated him as representing their ‘constituency’ in the government. But has Dr Aganga, managing director in hedge funds at Goldman Sachs since 2003 until he was appointed Finance Minister, really delivered?

Several observations could be made:

One, in our type of countries, where the institutions are weak and the wishes of the man of power are virtually law, it will be unfair to completely blame any Finance Minister for the failings of the economy. For Dr Aganga who was appointed Finance Minister on the eve of an election year in which the President is also a candidate, assessing his performance becomes even more complicated since political considerations are often the dominant considerations in policy-making and execution in an election year. My personal opinion is that the legacy of Dr Aganga, an expert in wealth management, may well be tied to the fate of the National Sovereign Wealth Fund, which has his finger prints all over it.

Two, while Dr Aganga can be excused for any non-performance of the economy, it is possible to assess the extent to which he has brought the ‘x-factor’ to governance –  positive intangibles that reflect his long years of sojourn in Europe and from being a director of a major investment bank. My strong feeling here is that he takes criticisms of the economy by top politicians and public figures as a direct attack on his competence and consequently reacts inappropriately.

A case in point was when former Vice President repeatedly expressed concerns about the direction of the economy, in particular over the regime’s accumulation of huge loans and depletion of both foreign reserves and the Excess Crude Account.

There is no doubt that Atiku’s concerns about the economy were, as should be expected of any presidential candidate, tainted with politics.  Unusual for a Finance Minister, Dr Aganga jumped into the fray and warned Atiku, a politician, not to ‘play politics’ with the economy. In our political tradition, a Minister is considered too junior to take a direct shot at a presidential candidate, especially a credible one who had been a former Vice President of the country.

Dr Aganga further told Atiku that the ‘economy is too technical for some people to understand’ (ThisDay, November 25, 2010).  In countries like the USA, this statement would have opened him up to charges of ‘elitism’ – of talking down to people.

Three, ironically while Dr Aganga believes that the ‘economy is too technical for some people to understand’, some economists hold  a similar ‘disdainful’ view of him on grounds that he is not a macroeconomist, has not published any paper on Nigerian economy and has questionable understanding of how Nigeria works, having been living abroad for too long. I have several times found myself playing the role of Dr Agang’s unofficial spokesman, especially among economists – not because he is a fellow Diasporan but more because I have tremendous respect for what he has accomplished at a personal level and also believe that with his exposure he will be able to attract competencies that will complement his own skills. Dr Aganga graduated in 1980 with a First Class Honours in Financial Accounting from the University of Ibadan and subsequently did post graduate studies at Oxford University, UK.

Four, with the lull in political activities following the end of the primaries, it may perhaps be germane to have honest discussion about the direction of the economy. Besides the undeniable depletion in foreign reserves and excess crude accounts, there are other worrying statistics:

The Vanguard of July 20 2010 reported that the federal government raised alarm over the increasing rate of unemployment in the country which official figures said was at 19.47% (some say the real figure is likely to be around 40-50%). On November 5, 2010, the Nigerian Tribune reported that the “World Economic Forum (WEF) has slammed Nigeria over alleged poor governance and inadequate infrastructure financing” and downgraded the country to 127 out of 139 countries. In the 2010 Human Development Report compiled by the United Nations Development Programme (UNDP), Nigeria was grouped among the 41 countries considered to have the “least human development”. 

According to the Report, Nigeria’s wealth —as defined by gross domestic product per head—has slipped. The GDP per head in Nigeria was given as a mere 1,224 dollars, compared to 9,812 dollars in South Africa, 1,628 dollars in Kenya and 2,197 dollars in Cameroon. On life expectancy, the Report said that in 2010 Nigeria’s life expectancy was 48.4 years on average, below that of Ghana (57.1.), Cameroon (51.7), Benin Republic (62.3), and Uganda (54.1). Meanwhile a list released by Transparency International on October 26, 2010 showed that Nigeria has fallen four steps (from 121 position in 2008 to 130 in 2009 to 134 in 2010).

Again in October 2010, it was reported that Nigeria slipped from 35th to 40th position in the Mo Ibrahim good governance ranking of 53 countries in Africa. Similarly a survey conducted as part of its membership operational audit in January 2010 by the Manufacturers Association of Nigeria, showed that 839 manufacturing companies closed shop in 2009 as a result of harsh operating environment. . With these statistics – and politics aside – it is difficult for any patriotic Nigerian not to be concerned.

Five, with due respect, I disagree with the Finance Minister that expressing what I will regard as robust concerns about the direction of the economy amounts to deliberately talking down the economy. I am uncomfortable with some of the language used by the Minister in replying to critics, including his use of innuendo to suggest that Professor Chukwuma Soludo, former Governor of the Central Bank, should be in jail- apparently for his rather ill-advised harsh criticisms of the direction of the economy in the media.

In the ‘marketplace of ideas’ theory of democracy, it is generally believed that “the best of truth is the power of the thought to get itself accepted in the competition of the market”. And this implies looking beyond the messenger – even if his ideas offend, shock or infuriate – to interrogate his message and accommodate those that are useful. It is precisely this capacity to look beyond a repugnant messenger and to accommodate uncomfortable criticisms that separates mature democracies from banana republics.

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