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Aganga vs Soludo: The pot and the kettle

By Les Leba
My attention was drawn to a rejoinder by a Lagos based communication outfit, who described our above article as untoward.

Consequently, the above article is reproduced below for the benefit of those who may have missed it.

Recently, former Vice President Atiku Abubakar published an open letter to President Goodluck Jonathan on the depressive state of our economy.

Indeed, the thrust of Atiku’s observations were clearly in the same direction copiously enunciated in articles in this column, and to which there has never been any formal government rebuttal, yet the same observations by Atiku, erstwhile presidential candidate, certainly touched the raw nerve of Jonathan’s administration.

Sequel to Atiku’s critique, President Jonathan summoned Olusegun Aganga, Finance Minister, Lamido Sanusi, Central Bank Governor and Professor Casey Garba, Special Adviser on Economy to a meeting in Aso Rock on damage limitation.

The front-page picture of the perplexed trio at the end of that meeting in a national daily was an indication that all was not well.

Thereafter, government’s economic team made a feeble attempt to cover the exposed ugly rump of Jonathan’s economic management in a newspaper advertorial. But the wounds inflicted were obviously more than skin deep, particularly on the part of erstwhile International Finance guru now turned Finance Minister.

In response to a question in a televised discussion program on the content of Atiku’s observations, Olusegun Aganga riled away at Chukwuma Soludo, former CBN Governor, who apparently had been discovered to be Atiku’s letter writer!

Aganga berated Soludo for deceiving the country about the stability and immunity of the Nigerian economy and the banking system between 2008 and 2009, and concluded that in other serious nations where public officers were made accountable, people like Soludo should be in jail!

In the light of the consistent position of this column on economic accountability, it would be difficult to dissociate from such a conclusion. (See e.g. “AFC’S $60M REMITTANCE: SELF AGAINST NATIONAL INTEREST” at

In that article, we related how former CBN Governor, Soludo, created African Finance Corporation, AFC, with $460m government funds without any permission from either Federal Executive Council or indeed, National Assembly.

The funds ‘stolen’ became evidence in a CRIMINAL CHARGE OF MONEY LAUNDERING against United Bank for Africa, in a case instituted by United States Financial Crimes Agency, where UBA was adjudged guilty and consequently paid a fine of $15m.

Worse still, AFC, in which Soludo was President consolidated the $460m seed money from proceeds officially borrowed on behalf of the Federal Government of Nigeria from sale of treasury bills to primarily, the same Nigerian banks to whom he had liberally disbursed $7000m of Nigeria’s foreign reserves as bonus endowment for successful recapitalization, with terms which continue to remain shrouded in secrecy!

Meanwhile, the expressed purpose of treasury bill sales was simply to sterilize excess cash in the money market in spite of unceasing lamentation that banks lacked sufficient funds to lend to real sector! AFC seed money, which was primarily derived from naira denominated treasury bill revenue, was then converted to dollars by Soludo through the promotion of a liberal freewheeling Bureau de Change system (BDC).

Whoever heard of Bank of England or Federal Reserve officially allocating its foreign reserves to High Street BDC operators? In another curious twist, the then Chief Executive Officer of AFC, Austin Omeruwa, confirmed while under interrogation by EFCC that AFC found that the most profitable investment was to lend its funds back to Nigerian government, because of the high yields of Nigerian government’s bills and bonds!

So, Nigeria’s funds, earlier surreptitiously siphoned were recycled and loaned back, to the original owners! True to Omeruwa’s projection, AFC quickly made a profit of $60m from this lucrative investment, which was again, officially transferred abroad to owners of AFC, with the blessing of CBN Governor!

A five man investigative team commissioned by Aondoaka, Attorney General of Federation confirmed that Soludo had abused his office in this scamin its report.

In the light of the above, Aganga’s observation that in countries with responsible governments and criminal administrations, Soludo should be in jail cannot be faulted!

Indeed, some critics would also argue that the former Governor’s mismanagement of the banking sector, unfettered level of margin loans, and spurious modus operandi of the banking consolidation exercise may indeed border on criminal negligence.

Indeed, the apparent affluence and huge funds deployed by Soludo in his failed attempt to capture Anambra State’s government house have raised eyebrows in many quarters, particularly when a powerful kingmaker in the State politics was quoted in the media to insinuate that the erstwhile Governor’s ‘fight’ to be State Governor was to seek immunity from prosecution for his misdeeds in his former job!

However, above discussion does not detract from the veracity of Atiku’s letter as earlier indicated, as the content is in consonance with the criticisms made on the economy in this column for several years!

But the question is, should Aganga, as a ‘reformist’ and responsible Nigerian citizen, just stop at the point of labelling Soludo a criminal (if indeed, that was so)? What, we may ask, has Aganga done in his capacity as Finance Minister to ensure that Nigeria moves nearer to the path of those countries where officials are accountable for their actions in office and risk the possibility of jail terms for crimes committed?

In any case, why did it take the slap on his ego by Atiku’s letter to suddenly wake up to the reality that Soludo’s actions in office should have put him in jail? Such behavior only portrays Aganga as a hypocrite and not a true patriot!

Well, in his own defence, Soludo came out blazing with primarily self-adulation covering two full pages in major Nigerian daily newspapers. Incidentally, observations made on the abject failure of Aganga’s tenure as Finance Minister, are simply an amplification of Atiku’s letter to Jonathan, only this time, there is a strong dose of “I did better than you while in office, and you have now upturned every good thing I did”!

Anyone who has not read Soludo’s treatise has not missed anything. In the same manner in which he and his other co-travellers in Obasanjo’s Economic Management team deceived the then President that they were taking us to El Dorado, when, in fact, they lacked a functional compass, Soludo has once again tried to bluff his way and distract attention from his failures.

The truth, of course, as also amplified in the Daily Independent editorial of Wednesday, 9/2/2011, is that both Aganga and Soludo are birds of the same feathers; they both leave the substance and chase shadows! Both of them recognize that they are playing a game of deceit at the expense of Nigerians.

Aganga on one hand is trying to save his job, while Soludo is seeking to be relevant in the hope that his failure can be reinvented to mean a successful time in government as CBN Governor.

In spite of the huge resources at his disposal when foreign reserves exceeded $60bn, Soludo and his IMF cohorts frittered this away to less than $40bn before his departure.

In spite of his proclaimed expertise, during his tenure, the rate of unemployment continued to rise and in spite of the abracadabra, interest rates never fell to single digit to enable real sector to thrive, funds which had been consolidated from banks’ profits for investment in real sector were inexplicably returned to banks before Soludo left office.

Rate of inflation never fell to single digit and naira continued to lose value in spite of rising foreign reserves; thus, purchasing power of all income earners continued to be reduced and our subsidies on fuel imports touched N500bn a year because of the fall in naira value.

In the same vein, the obnoxious and reckless process of the capture of the Nation’s dollar revenue and the substitution of naira values for payments of allocations to the three tiers of government continued unabated, and the forays of Debt Management (read as debt creation) Office in accumulating useless domestic debt also prevailed in Soludo’s time.

These subjects formed the basis of various articles in this column, and we consistently lamented the rising debt profile in, for example, articles like “NATIONAL ASSEMBLY FIDDLES AS DEBT BURDEN CRIPPLES” in May 2008, “BLEEDING US TO DEATH WITH DEBT (1 – 3)” September 2008, etc.

We also decried the unusually high cost of servicing both external and internal debts at rates, which remained in double digits. Above idiosyncrasies were inherited by Aganga and in the name of continuity, faithfully implemented, but Aganga has now upped the ante in all these fronts to the detriment of Nigerians!

Soludo’s verbose response to Aganga’s charge is not really about the quality of each person’s strategy; Chukwuma wishes to divert attention from, and distinguish his failure in government but more importantly, he wants us to forget what EFCC administration confirmed to be criminal culpability for which he sought and received unusual Presidential Pardon even before he was formally prosecuted and found guilty.

In the light of the above, if the Professor feels that Aganga has done damage to his image by insinuating that he should be in jail like a common criminal, Soludo should do what is honourable and sue Aganga for libel and not ask for a debate; a debate on what?

Both of them are the same, six and half a dozen; if Soludo does not have the courage to do so, he should stop disturbing our sensibilities and quietly admit Aganga’s charge that he should be in jail!

After all, he is yet to respond to Senate President’s charge that he deceived the National Assembly nor has he raised a whimper of protest on the putrefying rot in the banking sector revealed by Lamido Sanusi, current CBN Governor, soon after Soludo left office.

As for Aganga, he may also be charged in future for the damage to economy by his ‘follow your predecessor’s strategy’ by promoting capital flight, smuggling and damage to real sector by his continuing disbursement of federally owned dollars to BDCs.

He will also have to explain why bloated naira allocations are pumped into banks every month only to turn round and borrow same back in the guise of mopping up excess liquidity; same strategy that failed to bring down interest rate, reduce inflation or reduce unemployment in Soludo’s era!



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