By Grace Chigbu
Lagos, Nigeria – Former Emir of Kano and Grand Khalifa Tijjaniyya Nigeria, Muhammad Sanusi II, delivered a compelling message on the crucial link between politics, governance, and a nation’s economic well-being during the Nigerian Institute of International Affairs (NIIA) Distinguished Lecture Series. The event, themed ‘Resetting the Nigerian Economy for a Brighter Future,’ provided a platform for Sanusi to address key economic issues plaguing Nigeria.
Sanusi emphasized that the economic fate of a nation is significantly influenced by the ideological orientation of its political leaders. He drew attention to the problem of multiple exchange rates, a long-standing issue recognized by economists but overlooked by politicians who benefited from the disparity between exchange rates. Sanusi explained, “People talk about fuel subsidies as far back as 2011. We said, if we did not do something about those subsidies, we would end up where we are today. It took 11 years.”
One of the most critical points Sanusi made was about the structure of fuel subsidies in Nigeria. He argued that the government’s practice of fixing the price of petrol, a commodity subject to international market forces, was financially unsustainable. Fluctuations in oil prices, exchange rates, and interest rates had a direct impact on the government’s balance sheet, without adequate backup. Sanusi’s assessment of the situation was clear: “It was an unsustainable model.”
Sanusi, a former governor of the Central Bank of Nigeria (CBN), did not limit his critique to politicians. He pointed out that civil societies and institutions also share the blame for the current state of decay in Nigerian society. He underlined the importance of having qualified individuals in charge of critical institutions, stating, “We have 48 ministers, but how many economists are in that list?” Sanusi’s question highlighted the need for expertise and knowledge in key positions to make informed economic decisions.
To address Nigeria’s fiscal challenges, Sanusi emphasized the necessity of raising revenues. He warned that without prompt action on fiscal policy, Nigeria might find itself in a situation similar to that of Ghana. The call for a more sustainable economic framework was clear in his speech.
Eghosa Osaghae, the Director-General of NIIA, echoed the urgency of regenerating Nigeria’s productive capacity. He emphasized the need for Nigeria to become a manufacturing nation and harness the African Continental Free Trade Area (AfCfTA) to establish its dominance in the continent and beyond. Osaghae’s message aligned with Sanusi’s vision of resetting the Nigerian economy for a brighter future.
Sanusi’s speech at the NIIA Distinguished Lecture Series serves as a wake-up call to address economic and fiscal challenges in Nigeria. His insights into the flaws of the existing system, including the unsustainable fuel subsidy model, the importance of qualified individuals in governance, and the need to raise revenues, underscore the urgency of a comprehensive fiscal policy overhaul. To achieve a brighter future, Nigeria must heed these words and implement meaningful reforms in its economic and political landscape.