How to develop Nigeria, by Okonjo-Iweala, Nnaji, others

Posted by admin Latest Politics, National Politics, Women Politics Wednesday, July 6th, 2011

THE Senate resumed screening of ministerial nominees yesterday with candidates listing ways of realising the Vision 20:2020 agenda of the Federal Government.

Among those screened were former Special Adviser to the President on Power, Prof. Barth Nnaji (Enugu State) and former Minister of Finance and Managing Director of the World Bank, Dr. Ngozi Okonjo-Iweala.

As part of his answers, Nnaji said the country would need about $10 billion yearly for about 10 years to properly and efficiently reposition the power sector.

According to him, the nation is blessed with abundant resources to generate power, including coal, hydro and solar energies, but the process is capital intensive; thus, the need for privatisation and the consequential increase in electricity tariff.

Nnaji rebuffed the protest against his nomination, noting that it was stage-managed by some interest groups, who were afraid of change. He added that there were three unions in the sector, including the pension, the senior staff as well as the junior staff union.

He said that it was only a segment of the junior staff union, who were afraid they may lose their jobs upon privatisation, that agitated against his coming back because they anticipated down-sizing of staff.

According to Nnaji, even when retrenchment becomes imminent, plans are on ground to ensure they get their full benefits. “Upon privatisation, there would be no need for most of these people but the plan is not to leave the workers in the cold but to ensure their full benefits are taken care of and in full privatisation, there would be other groups that would have shares. Workers actually would have the opportunities of owning shares in the company. So, it is normal fear and I can understand. I also believe the segment of workers was hijacked by interest groups who do not want change.”

Nnaji, who spoke in favour of the privatisation bid, said it was the only veritable means of ensuring adequate and regular power supply.

The issue is being able to do electricity business the way it is supposed to be done.

He spoke further on the plans of the Federal Government: “We are planning to revamp the existing Federal Government power plants, which has capacity of over 5,000mw but producing 2,400mw. We need to recover full capacity by privatising these plants, next are the existing independent power projects. Those power projects should be maintained by being able to pay when we have power. The third approach is the bulk trader we talked about before – to buy from private company about 6,000 to add to the existing capacity. The cost of display by investors is an indication that the country is ripe. You cannot get it right unless tariff reflects the cost.

“What is being planned is that as power continues to increase, the way it is now, you cannot ask them to pay the exact tariff. Over the next three years, there would be subsidy so that the tariff would increase as more power comes. There would be a cost subsidy in the Electric Reform Act that urban poor and rural dwellers would not see this kind of increase, people who are supposed to pay for power should be able to pay.”

The Senate President, Senator David Mark, told him that if posted to the power sector, the Senate would hold him responsible if he fails to deliver based on the explanation he gave at the screening.

On her part, former Minister of Finance and Managing Director of the World Bank, Dr. Ngozi Okonjo-Iweala, cautioned that politics should be divorced from the economy. “To grow the country and economy, you need every sector and ministry to be important and do the needed work. I believe that every single sector is important in the country and it would be left for the President and senators to decide but economically, every sector matters.

“The minister of petroleum should do the needful to make the sector transparent if people feel it is not. I don’t know why exploration of oil should assume political dimension, every country blessed with such resources tries to see how to exploit it maximally. We should encourage increased exploration in all parts of the country without political sentiments”, she said.

She explained that she didn’t run away from the government of former President Olusegun Obasanjo but resigned when she felt she was not working and contributing the way she should.

She spoke further on the economy: “We should try to live within our means. Current expenditure is almost 74 per cent of the budget, so, no place for capital project. The main problem with the economy is job creation. We should give priority to sectors that are job creating.

“Right now, we are one of the few countries that are oil-producing, we are losing reserves. We should rather be increasing our reserves. If you want to revalue the naira, this might not be the time to think about it. We should wait until things are more stable, we are growing our economy and creating jobs.

“Refineries, why are they not working? I wished I knew better. Petroleum engineers should help us identify but I think machines are obsolete. We need proper frame-work for refining our oil, there is no reason why we should not.”

She said the governor of the Central Bank of Nigeria (CBN) should be allowed to explain the recently introduced cash withdrawal limit. “Cash withdrawal. It would be wise to tell Sanusi to understand exactly what he has in mind when he made the policies. All I can say is that whatever the case may be, other countries are trying to use electronic means of cashing money but we should also be a little careful because people may decide to keep money at home. I like the objective of making us a cashless economy but we should do that carefully”, she said.

The former minister also spoke on industrialisation. “To achieve the type we want, we should tackle infrastructural need. We should demand result of all the money spent on privatisation. We should support all the areas we have comparative advantage.

“If we can run a budget that is not deficit, we can do it. We have done it before. How can we invest in capital if we are spending all on re-current expenditure?

“We can manage the N18,000 minimum wage. Are we going to be a country that is not able to produce enough capital to invest in the future?”

Answering questions on the recently introduced non-interest banking, she cautioned: “We should look at this without emotion. As far as I understand it, again, it is a question for the CBN governor who proposed it but to me, it is another form of banking where instead of charging interest, people who give loans charge interest. It is a way to give people who have the means to participate.

“But there are commissions charged in this system. We should understand what it is about and look at it dispassionately. It is another type of banking and many countries in the world are opening up this type of banking. We should look at the actual implementation. It functions relatively within other kinds of banking.”

She added: “We need to look at wage bill, over-head. We have got to find a way to work both on revenue side and cost side and cost side is where we talk of what we do with recurrent budget. From the figures I saw, our revenues are not adequate to cover the recurrent budget.”

On the proposed removal of petroleum subsidy, Okonjo-Iweala said: “There is no issue with subsidies. The issue is that subsidy is general. Let there be a policy that would make only those who need it to get it. We should subsidise those in our population who need it. It would be very good to take part of it and put in place social security mechanism.’’

On his part, the immediate past Minister of Finance, Olusegun Aganga, explained the benefits of the Sovereign Wealth Fund.

Names of confirmed ministerial nominees include Prof. Nnaji from Enugu State, Dr. Okonjo-Iweala, South East geo-political zone, Mr. Olusegun Aganga, representing Lagos State, Dr. Bello H Mohammed, Kebbi State, Abba Moro of Benue State, Dr. Samuel Ioraer Ortom also from Benue State, Prof. Viola Onwuliri from Imo State, Prof. Ita Okon Bassey Ewa from Akwa Ibom, Senator Idris Umar, representing Gombe State and Dr. Obadiah Ando of Taraba State.

The Acting National Chairman of the Peoples Democratic Party (PDP), Dr. Bello Mohammed Haliru, Abba Morro and Samuel Ortom as well as Senator Idris Umar, were simply asked to bow and go.wp_posts