By Hassan Gana (Jnr)

The appointment of Mrs. Kemi Adeosun as Finance Minister did not come as a surprise to many analysts. She was a predictable choice, tipped by both local and international media as one of the favorites to clinch the top job because of her outstanding financial and accounting background. Bloomberg, a United States based  international financial magazine, in an article written by Paul Wallace, had predicted – based on a survey of select analysts – that she would be Buhari’s choice for Finance Minister on the basis that she “has a strong background, … has a lot of energy, … is high on integrity; … is pro-reform and ..is a realist.”

Kemi ADEOSUN

However, given the caliber of other nominees with relatively similar background, the eventual appointment of Mrs. Adeosun has expectedly generated differing shades of reactions from the local as well as international finance and business communities.

Some critics, who question her choice, cite her age, level of management experience and support for the CBN monetary policies as a huge limitation. For instance, Manji Cheto, Vice President of Risk Adviser Teneo Intelligence, thinks Mrs. Adeosun may struggle to convince Nigerians that she is the right person for the job because she doesn’t have a high profile like her predecessor, Dr. Ngozi Okonjo-Iweala. Malte Liewerscheidt, senior Africa analyst at Verisk Maplecroft, was also quoted by Forbes as saying, “Adeosun has a strong background in the UK’s private financial sector but may struggle to navigate federal politics”.

However, several other experts and economists of repute have applauded her choice as fitting for the office of Finance Minister. They cite her extensive experience working with private and global financial institutions and the significant positive impact she had on the revenue profile of Ogun State as Commissioner of Finance between 2011 and 2015.    Locally, Mrs. Adeosun’s appointment has received strong endorsements from leading experts within the Nigerian financial community. One of the strongest and most respected voices, who has for decades gained near unassailable credibility as an authority on financial intelligence and economic policy in the Nigerian financial industry, Bismarck Rewane, Head of Financial Derivatives Company, described Mrs. Adeosun as “an excellent choice”. According to him, Mrs. Adeosun had turned around the financial position of Ogun State when she served as Finance Commissioner.

As someone, who has followed closely the academic and evolving professional career of Mrs. Adeosun, I also believe President Muhammadu Buhari made the right choice. She is qualified, competent and reform-minded enough to manage the nation’s finances. Those who question her competence only do so because they are yet to know her beyond the youthful appearance, the brilliance of her voice and impressive British accent. She will prove her mettle, vindicate the trust and confidence that Mr. President has in her and even those who are currently in doubt will be convinced.

Born, raised and educated in London and Nigeria, the 48-year old Finance Minister is a consummate economist, a member of the Institutes of Chartered Accountants, England and Wales, as well as Nigeria, and a public financial management professional from the East London University and the University of London.

Attention to detail 

Though relatively unknown before her nomination as Minister, those who have worked with her can attest to the fact that she possesses impressive intellectual vigor and an unscrupulous attention to detail. She is also financially savvy with proven capacity to easily distinguish herself in all the places she worked as a high performer with an uncommon knack for creativity and innovation.

While she may not be coming from institutions like the World Bank like her predecessor,  Mrs. Adeosun, also a distinguished economist, brings on board a strong academic and professional background, youthful intellect, top level private and public sector experience, deep exposure to international best practices in financial administration and a strong network within the international financial community that she can leverage on to perform her job effectively.

She was a Senior Manager, a top level position with Price Waterhouse Coopers, one of the largest professional services firms in the world, 2000- 2002, where she garnered good experience, built a global network as a member of a world class financial institution.

She later joined Chapel Hill Denham Management, a reputable investment management firm – named in 2015 as the best investment bank by Euromoney – as a financial controller in 2002, and rose through the ranks speedily to the top position of Managing Director.

Mrs. Adeosun also worked with Quo Vadis Partnership as Managing Director, from June 2010 – June 2011.

‘Refined lady’ 

Interestingly, the same debate about her experience and age played out four years ago, when she was appointed Ogun State Commissioner for Finance. Not many gave her a chance. A lot of critics dismissed her as a refined lady who is only good at speaking ‘English’.

Four years later, the results of her work proved her critics wrong. She had successfully overhauled the Ogun State tax administration system, expanded the tax base, introduced efficient and transparent tax system which raised the state’s revenue base.

For someone, who has had this trajectory of academic and career growth that spans over two decades within both private and public institutions, local and international environments and systems, the argument that she has limited experience to function effectively as Finance Minister does not  hold water.

If a person can deliver in smaller assignments, that is sufficient proof that, given even greater tasks, he can replicate same level of excellence.

If it is not in doubt that Mrs. Adeosun excelled and possesses these qualifications, worked at all those institutions and did an excellent job as Commissioner for Finance, then I do not really understand the basis for the hues and cries about her appointment.

Beyond the background, the initial comments of Mrs. Adeosun show that she is not a novice on  the state of the nation’s finances and the challenges. During the Senate ministerial screening, she displayed a strong understanding of the current economic crisis facing    the nation as a result of the fall in global oil prices. She also showed a clear understanding of the efforts of the monetary authorities – the Central Bank of Nigeria – to manage the effects of the oil prices which have halved government revenues and the urgent need for clear and proactive fiscal measures that would complement those efforts.

As expected, her clear support for the Federal Government- backed foreign exchange controls introduced by the Central Bank have earned her hostile mentions especially within the international media and financial community.

“Adeosun’s seeming endorsement of current FX policy choices during her Senate testimony will disappoint investors who had been hoping for more rapid liberalisation of Nigeria’s FX market,” said Razia Khan, Chief Africa economist at Standard Chartered Bank.

“While, in our view, the need to boost fiscal revenue in order to bring about an economic recovery will be key to future FX policy decisions, the longer there is uncertainty over Nigeria’s policy choices, the longer the shortfall in both portfolio and direct investment will persist,” she said.

Foreign exchange policy

Mrs. Adeosun is right to support the CBN policies and the hostility did not come as a surprise.    Our economy has been hit hard by a collapse in the price global price of oil, a resource that the state depends on for more than two-thirds of revenues. This has happened at a time that the country has very low savings, low foreign reserves and there is obviously no easy way out. As far as the West is concerned, the only way out of this predicament is for Nigeria to allow a full float.    However, what those calling for a floating FX regime failed to note and decided to ignore is the fact that Nigeria a high import-dependent.

However, the experiences of countries like Ghana, Russia, Zambia and Brazil show that devaluation is not the perfect solution to our economic problems. For instance, Russia and Brazil have both slumped into recession even after allowing their currencies to depreciate by 40% and 42% respectively.

In addition, Ghana and Zambia who have also allowed the value of their currencies to fall by 27% and 45% respectively are also heading fast towards recession.   In fact, Ghana’s latest growth rate is less than 1% while Zambia recently declared a National Day of Prayer because of slow growth!

These comparisons are important because Nigeria and these countries share a lot in common. These countries rely on exports of raw materials as a major source of national revenues, just like Nigeria. They are also facing the challenges caused by the fall in global oil prices and lower demand for commodities from China and elsewhere in the world.

At a 2.5 GDP growth according to latest statistics, financial analysts have projected that an indeterminate fall in the naira would push inflation rate from the current 9.3% to over 13.5% a situation that would drive growth rate into negative territory and slide the country into quick recession. These possible consequences are by far worse than whatever temporal benefits currency devaluation may hold.

What Mrs. Adeosun needs is the support of the generality of Nigerians and the free hands to manage the economy, given the fact the clearly thought-out policies are needed for the nation to overcome these trying times.    There must be synergy between fiscal and monetary authorities, described as the two critical legs upon which the economy stands.

• Gana (Jnr), a public affairs analyst, lives at 25 Shendam Street, Agwan Rogo, Jos, Plateau State.