AT a time that our state governors are busy bickering and strategising about statutory allocations, other nations are aggressively harvesting the infinite opportunities that globalisation has created for world economies!

This year (2012), our entire Federal Government budget (which continues to depend on oil) is about N5 trillion, while India will get $70 billion (N10.5 trillion) from software exports alone (just software, not all exports)!

Perhaps we should look back at where both India and Nigeria are coming from! In the 1980s, when the Delta Steel Company, DSC, was being built by a consortium of European companies, Mecon of India, which was serving as consultants to DSC, seconded many of its experienced engineers to DSC, to help groom their DSC counterparts.

While these highly experienced expatriate Indians were assigned official brand new, chauffeur-driven and air-conditioned cars, people in DSC were usually surprised to hear of how some of them were receiving letters from their home office, informing them of the approval of their motorcycle loans! This was at a time that many of the young Nigerian engineers being groomed by these Indians, were looking forward to buying brand new cars in a few years!

This same India has since transformed itself into one of the sensational BRIC (Brazil, Russia, India and China) economies, while Nigeria (preoccupied with statutory allocations) has retrogressed deeper into poverty! While the world is witnessing the emergence of a new set of post-BRIC economies, the “MIST” economies (which includes even Indonesia), figures from the NBS show our absolute poverty worsening from 54.7 in 2004 to 61.9 in 2011!

The real tragedy is that despite this lamentable state of our nation, our entrenched interests are still fighting viciously to ensure that nothing is changed! Have you observed that it is only our ministers and other officeholders trying to reform the system, that come under severe attacks and castigations, while their counterparts, who are doing nothing, are having their peace?

Even more tragic is how the vested interests are cleverly using the rest of us to fight our nation!  As we shrug at (or even support) the troubles of Aruma Oteh and her reforms at SEC, Bart Nnaji and his power-sector reforms, Sanusi Lamido Sanusi and his monetary reforms, Deziani Alison-Madueke, Ngozi Okonjo-Iweala, etc, what do we think we are doing?

The answer is that we are effectively helping our entrenched interests to ensure that nothing changes; to ensure that all the officeholders who “do nothing” have their peace, while those that dare to reform the system, see “hell”!

I would like to take us back to the CBN’s banking industry reform of 2004 (under Prof. Chukwuma Soludo) because of the enduring lessons it seems to hold for our situation today! The most significant aspect of that reform was the decisive deadline it gave to our grossly undercapitalised banks, to recapitalise to at least N25 billion, or lose their licenses! Prof. Soludo was almost hounded out of office for daring to advance that policy!

The criticisms that greeted the policy were unusually scathing, with merciless and sometimes hateful condemnations raining on Soludo from all sides, and questioning his competence for the CBN job! Ironically, the attacks were coming as much from us, as from anybody else!

For example, in a very powerful essay, “The Facts that Soludo Left Out”, Dr. Ayo Teriba, one of Nigeria’s most influential financial experts, after attacking the policy, had charged: “… As a highly respected scholar, the CBN governor will do well to publicly retract his utterances in these regards, in the spirit of academic humility. Consequently, he should withdraw his proposal that all banks must raise their capital bases to N25b …”. Similarly, one of Nigeria’s most respected columnists, Simon Kolawole, in a piece titled, “Soludo, Banking is not Ludo” charged: “The impression I get is that Soludo has just entered a new terrain, and without acclimatising, he has dived headlong into the unknown …”.

You would almost wonder if it was not the same CBN that various other persons had headed very quietly in the past! In the end, it was only President Olusegun Obasanjo’s “stubborn” backing of his reformer that saved that reform at that critical time (in clear defiance of the National Assembly and all opposition)!

This not only sent a clear message of the President’s seriousness with reform, but also served as a Presidential inspiration to his reform team that was daring to say “enough is enough!”

Ironically, that recapitalisation (or consolidation) ended up changing dramatically the incentives driving our banking sector, and (not minding the abuses that later occurred) making a profound impact on our nation, some of which I need to recall here!

Our banks that had previously lacked the capacity to meet the funding requirements of serious businesses (causing the likes of MTN and Econet to source most of their funds overseas), could now come together to offer local syndicated facilities to blue chips! CBN data showed bank credit to our core private sector rocketing from N1.19tn in 2003 to N4.9tn in 2007! Banking in Nigeria moved from the realm of rent-seeking and “glorified trading in foreign exchange”, to real banking!

The consolidation also capacitated the industry to make required investments in modern technology, which heralded new banking platforms (including ATMs) that finally moved us to a new era of any-branch banking (where you could now walk into any branch of your bank, and get served as fully as if in your own branch)! It was also the consolidation that capacitated the banks to achieve the nationwide branch expansion that government had been demanding since the 1980s.

We saw bank branches exploding nationwide, with brands such as Zenith and Oceanic particularly expanding phenomenally! The impact of this was phenomenal on the economy. The number of depositors surged! CBN data showed bank deposits rocketing to N5.4 trillion in 2007, from only N1.4 trillion in 2003!

NEW ancillary businesses mushroomed overnight to meet the swelling needs of these expanding banks (in the areas of networking, systems integration, media and branding, security services, etc). Qualitative employment naturally exploded for Nigerian youths, as the expanding banks and their ancillary-service providers snapped up young Nigerians in large numbers! The story was the same in our capital market, where the recapitalisation spurred a spate of public offers, private placements, and daily transactions that drove the market to unprecedented indices, boosting business, industry and employment; and creating wealth for investors. All the earlier apprehensions of labour unions about consolidation became unfounded! Instead, we saw the gradual re-emergence of Nigeria’s middle class!

So optimistic did our national outlook become, that Goldman Sachs’ research report for 2007 listed Nigeria among its ‘Next 11’ group of countries expected to catch up to the fastest developing BRIC economies! That reform might also have been very providential, considering what could have become of the Nigerian economy, if the global meltdown that soon followed, had met us with a financial sector driven by fragile, undercapitalised banks!

The lessons

I am sure the people at CBN will say a lot more about the benefits of that consolidation; but the point of highlighting them is to help us see the kind of progress the nation is denied each time our powerful vested interests hound and bring down any officeholder that dares to change things! Remarkably, the scenario is replaying itself with our present officeholders that are trying to reform the system – Aruma Oteh, Bart Nnaji, Okonjo-Iweala, Alison-Madueke, etc!

For example, look at our oil sector, where some of the most transformational clouds of President Goodluck Ebele Jonathan are gathering: For the first time, an industry that had operated in the darkness of powerful untouchables, is being fundamentally ripped apart! What many Nigerians don’t realise is that all the unprecedented revelations and debates we are seeing today in that industry are coming because somebody, rather than simply toeing the old line, is daring to change things! In January this year, we almost dramatically deregulated the downstream sector, in an initiative whose impact (had it succeeded) might have liberated the industry from the grip of a few families, and dwarfed even our Soludo and telecoms reforms! Although Nigeria temporarily lost that battle, it was still a very highly significant ministerial initiative! Similarly, the all-important Petroleum Industry Bill, PIB, which had clearly forgotten the destination of the 12-year journey it started since 2000 (with President Obasanjo’s “Oil & Gas Reform Implementation Committee”, OGIC), is now suddenly contemplating reality! This means that all those years of regulatory uncertainty, blocking billions of dollars of oil-sector investments, are coming to an end! Again, for the first time in our oil industry history, we now have a “Nigerian Content Development Act”, which has created enormous capacity for massive local participation in that sector.

All these are happening simultaneously with various other reforms, including the construction of a massive, unprecedented gas distribution infrastructure, which among other things, is bringing reality to the power plants that previous governments had constructed across the country without provision for gas supply (only Nigeria can do that)! Because the budget for that infrastructure project did not disappear into our private pockets, as with our past turn-around maintenance projects, Nigeria now has suddenly created a massive gas infrastructure – including one of the biggest pipeline projects ever in this country, which now gives life to the stranded 700 megawatts power plant at Olorunsogo, Ogun State! Clearly, our oil industry is seeing something more serious than the cosmetics it was used to! Perhaps, the next round of public hearings will finally unearth (for public debate) the identities of the powerful Nigerians that appropriated Nigeria’s oil wells to themselves and their children!

I have never met our Petroleum Minister, Mrs Deziani Alison-Madueke, nor any of her assistants; and it is not for me to make her case. But if transformation is what Nigeria desperately needs, Madam Minister has been far more transformational than several of our past petroleum ministers put together! Now, what is she getting in return? Praises? No! Instead, the vested interests are highly alarmed, and fighting back desperately!

But Nigeria’s future is rooting for these reformers! That is why Mr. President must continue to boldly support the few members of his cabinet that are daring to change things! The transformation of our nation (and even the legacies of his Presidency) will come from them! He has been commendable on this, including his efforts for Aruma Oteh, whose reforms at SEC, appear to have so much upset the establishment!

Mr  GABRIEL ZOWAM,  a social critic, wrote from Lagos