Patrick Dele Cole

September 26, 2016

Sale of assets: Selling the state’s jewels

Sale of assets: Selling the state’s jewels

By Patrick Dele Cole-OFR
THE Senate a short while ago spent a few short hours debating the State of the economy. They asked for a new economic team because they thought that the ministers of Finance and Budget were not up to the task of pulling Nigeria out of recession. They recommended the selling of national assets such as NLGN, parts of NNPC; so as to holster up our foreign exchange reserves: reduction of government spending, boosting agriculture etc.

There was not one mention about cutting the expenditure of the National Assembly itself. I am not sure whether some of these assets could actually be sold as revenue from them is a constitutional matter. It has occurred to me that other assets could also be sold. How about selling the National Assembly itself or selling the Central Bank? There would be quite a sizeable amount to be derived from these assets. The National Assembly has spent countless hours debating the PIB since 2006. The Bill has still not been passed. Our national economy and the recession merited a few short hours.

It seems rather odd that Nigeria is willing to sell our shares in Nigerian National Petroleum Corporation (NNPC) and the International Oil Companies (IOCs). If we needed to sell anything, should it not be the least productive asset, rather than the most productive assets and those that are still producing? We could sell parts of Aso Rock and the Federal Secretariat. Do not be so shocked. There are precedents. Some of the Queen’s palaces have been sold over the years. Near the Nigeria High Commission in London is a five star luxury hotel: the building was part of the War Office (Ministry of Defence). Large parts of British Rail have been sold especially the valuable land near stations and along the Rail lines.

If these assets in Nigeria are sold, who would buy them? Given our history of opaqueness with regard to disposal of national assets? Your guess is as good as mine! Which assets are we considering to sell? Do they include the Ports of Lagos and Onne? Do we have any valuation of these assets or are they now to be valued? How long will the valuation take? Prospective buyers would also want to do due diligence?buhari-sale

Do we have enough records for this? Incidentally we have been through this road before we sold Peugeot, WV, Trade Fair, Ajaokuta Steel Mill, Aluminum Plant, Oku Iboku Paper Mills in Akwa Ibom. The stories about these sales are almost pathetic. What happened to the money? For example, the Ajaokuta mill – after spending nearly US$ 50 billion on it, what did we sell it for? And then we would not allow the buyer to do his business and produce steel. He took us to court. We would have to pay compensation.

Governors whose reckless spending put us in this economic predicament should be the last people to suggest sale of assets. These were the people who opposed President Jonathan’s Sovereign Wealth Programme when we could have saved substantially, and whose debts to local banks threaten to bankrupt the banks. Governors are a fast moving train with no brakes and no drivers. The result is inevitable crash. They have no accountability, no obligations except to themselves. Some of them have already sold nearly all their states’ assets; and have left their states littered with unfinished projects.

Where is the thinking that we should work productively and work our way out of recession. Is money from sale of assets revenue? If so, would it be shared as other revenue through the sharing formula? Is this new sale of assets campaign to frustrate demand for resource control and restructuring?