Soludo replies Okonjo-Iweala, accuses her of forging national economics statistics

A former Central Bank Governor, Charles Soludo,
has reacted to the criticism of his earlier article by
the Minister of Finance, Ngozi Okonjo-Iweala.
In a lengthy, over 6000 words article, Mr. Soludo
on Sunday rejected claims by Mrs. Okonjo-Iweala
that he performed poorly as governor of the
Central Bank. He said his performance as CBN
governor was unprecedented locally as well as
globally acknowledged.
“In Nigeria’s history, no governor of the Central
Bank has delivered 24 consecutive months of
single digit inflation as I did until the advent of the
unprecedented global crisis in 2008,” he said.
Mr. Soludo then challenged claims by Mrs.
Okonjo-Iweala, who is also the Coordinating
Minister of the Economy, that the Nigerian economy
is doing well.
He accused Mrs. Okonjo-Iweala of running the
country’s economy aground.
“You are brilliant Madam, but you need serious
help,” he said while reeling our data to show the
porous state of the Nigerian economy. “Having
spent all your life in the World Bank bureaucracy
largely in administration/operations, no one will
blame you if your economics has become a bit
rusty. There are firebrand Nigerians all over the
world to draft to service. It is certainly
embarrassing to Nigeria for you to be bothering
World Bank economists to help you with most
basic economic analysis.”
He also accused her of forging Nigeria’s national
economics statistics.
Mr. Soludo said, “What worries me is that this
government is the first in our history to attempt to
manipulate our national statistics under Okonjo-
Iweala. When NBS published the poverty figures in
2011, she felt indicted and incensed. She called
upon the World Bank to come and examine the
‘methodology’ and get NBS to ‘review’ its
numbers. Oby Ezekwesili (as VP Africa Region
rejected the call to try to tamper with a country’s
statistics). Once Oby left, the ‘World Bank’ started
talking about ‘new figures’, without conducting any
new surveys.
“I was told about it by a World Bank economist,
and I cautioned that it was a dangerous gamble
that would damage the credibility of the NBS. If
you want to ‘review methodology’, you conduct
another survey but you can’t change
‘methodology’ because you don’t like the
published figures. No government in our history
has tried it: even Sani Abacha allowed a poverty
survey that put poverty at 67% under his regime.
At this rate, who will believe statistics coming from
the Nigerian government again? Is it now the World
Bank that sits in Washington and allocates poverty
numbers to Nigeria? Something smells here!”
Read Mr. Soludo’s full article below.
Ngozi Okonjo-Iweala and the Missing Trillions (1)
Chukwuma Charles Soludo
I read some of the responses to my article, “Buhari
vs Jonathan: Beyond the Election”, and I want to
thank everyone who has contributed to the debate.
I am glad that the debate has finally taken off. I
have decided, for the record, to re-enter the debate
if only to set some records straight and hopefully
elevate the debate further. Whom do I respond to?
First, let me thank Gov Kayode Fayemi for his very
mature and professional response on behalf of the
APC. It forms a great basis for deepening the
conversation. Pat Utomi, Oby Ezekwesili, Iyabo
Obasanjo, and thousands of other patriotic
Nigerians have raised the content of the debate.
Femi Fani-Kayode made me laugh, as usual. The
Gov. Jang faction of the Governors’ Forum played
the usual politics, although I know what most of
them think privately. Who else? Oh, Peter Obi.
Well, since he can’t write and designated Valentine
as usual to write for him (who never disputed the
NBS statistics that Obi broke world record in the
pauperization of Anambra people but instead
focused on lies and abuses) I won’t dignify him
with a response here. His third class performance
in Anambra will be the subject of a comprehensive
article later.
Here, I will focus on Dr. Ngozi Okonjo-Iweala’s
response (as Minister of Finance and Coordinating
Minister of the Economy—CME and hence on behalf
of the Federal Government). Since I have known
her, out of deep respect, I have never called her by
her name: I call her Madam. I must state that I
have great pains seeing myself on the opposite
side of the table with Madam, in this way. I respect
you, Madam, and will always do. If you read my
article of September 2010 (before you became
Minister), the tone and elucidation were as strong
as the current one. It is my honest effort to ensure
that our choice of leaders is based on rigorous
scrutiny of what is on offer. Part of my frustration
is that five years after, everything I warned about
has come to happen and we are conducting our
campaigns as if we are not in crisis. As a
concerned Nigerian, I have a duty to speak out
again. Regrettably, you have taken it very personal.
I am not bothered about the personal abuses: I
actually expected worse. What name has the
government not called President Obasanjo or any
person who has dared to disagree with it of late?
Anyone who disagrees with the government must
either be ‘insane’ or have a ‘character’ deficiency
or must be ‘looking for a job’ or ‘without honour’,
or a ‘charlatan’. Yesterday, Sanusi alleged that $20
billion was missing and he was accused of gross
financial mismanagement, recklessness and poor
governance to the point of being the first governor
of central bank to be suspended from office.
Today, he is the good one; and for daring to award
an “F” grade for our economic performance,
Soludo has become the ‘worst’ and ‘without
character’ or perhaps ‘looking for position’ (Lol!).
Some days ago, a former president was called ‘a
motor park tout’ and ‘un-statesmanly’ just for
disagreeing. This “how dare you criticise us”
mind-set of the government is dangerous for our
democracy.
In this Part One of my planned three part series, I
will restrict it to the main issues you raised. I will
not bother about the malicious attacks on my
person. For me, it is nothing personal. In early
2011, I had a similar heated exchange with then
Finance Minister Segun Aganga. But when the
Nigerian economy was at stake and he invited me
to a stakeholders meeting in his office (as Minister
of Trade and Investment) to discuss Nigeria’s
response to the ruinous EU- Economic Partnership
for Africa (EPA), I flew into Nigeria for that (at my
expense)— the first and only time I have been to
any government office to discuss policy since I left
office. It is about Nigeria. I will, as expected,
remind people like you of the salient aspects of my
record of public service in response to your
charge; challenge your claim to debt relief, and
your reason for not saving; highlight your forgery
of economic statistics and the lies in your
response; but most importantly re-focus our
attention to the historic mismanagement of our
economy which you carefully avoided. I will show
that while you are introducing austerity measures
and soon to immiserate the citizens, our public
finance is haemorrhaging to the point that
estimated over N30 trillion is missing or stolen or
unaccounted for, or simply mismanaged— under
your watch! We can’t go on like this, and I am
convinced that an alternative future is possible.
Can we have a public debate on this alternative
future? The issues at stake are too grave to be
trivialized through name calling. As I write, the
naira exchange rate to the dollar is at N215 (from
N158 a few months ago) and unless oil price
recovers, this is just the beginning. For the sake of
Nigeria, I won’t keep quiet anymore!
Let me start with Madam’s rather comical, wild
judgment on my tenure of office which I believe to
be totally false and baseless. I apologise upfront
that in the process of making a ‘personal defence’,
it is difficult to avoid a rather uncomfortable
emphasis on “I”. I did not want that but since
Madam has dragged us this low, I have little
choice but to do so in the next few paragraphs—
just to keep the record straight!
In my view, there are three criteria for evaluating a
public officer’s stewardship: the evaluation by his
employer; the satisfaction of the public he served;
and the hard facts of performance. As I will show
on these three counts, I am convinced that I left a
world record of public service, and a thousand
Okonjo-Iwealas cannot re-write that history. I
served Nigeria under two presidents (Obasanjo and
Yar’Adua) and as my immediate bosses, below are
their written testimonials of my record.
Said President Obasanjo (December 2004):
“Charles Soludo is a true Nigerian. He is the sort
of Nigerian that we all know we can rely on. Among
his numerous virtues is COURAGE. I have found in
him a man who can take tough and realistic
decisions, stand his ground, educate others on the
salience of his decision, and work very hard to
ensure that the decision is efficiently and effectively
implemented. His dedication to duty is first rate.
His leadership qualities are admirable and his
willingness to listen and learn is simply infectious.
Professor Soludo has within a short time emerged
as one of the leading lights of our nation. Not
because he has a godfather but by sheer hard
work, loyalty, dedication to duty, commitment to
the nation, creativity, and undiluted association
with the reform agenda….”
President Yar’Adua (May 2009) had the following
to say about the Central Bank of Nigeria under my
leadership:
“… the CBN has performed creditably well in
delivering on its core mandates. This is especially
even more so in the last five years. Most people
would agree that without the successful banking
consolidation and effective management of our
foreign reserves, the current global crisis would
have shaken the financial system and our national
economy to their foundations with calamitous
consequences”.
In the President’s special letter of commendation
after the completion of my tenure of office,
President Yar’Adua (June 2009) had the following
to say to me:
“As your tenure as Governor of the Central Bank of
Nigeria comes to a glorious end, I write on behalf
of the Government and people of Nigeria to place
on record our debt of gratitude to you for your
dedicated service and uncommon sense of duty
over the past five years. I am confident that your
worthy antecedents in the CBN and in prior
appointments in the service of our nation remain
sources of inspiration to an entire generation. As I
wish you even more astounding successes in the
years ahead, it is my fervent hope that you will
readily avail us of your distinguished service when
the need arises in the future”.
To the best of my knowledge, President Obasanjo
has not changed those views even after ten years.
The views of my two bosses, not the emotional
outburst of an angry person desperate to get even,
are what count.
How did Nigerians evaluate my public service?
Unfortunately, we do not have scientific opinion
polls on job approval ratings for individual public
officers. But if the public opinions of individuals
and organized groups (labour, employers,
depositors, borrowers, stakeholders of the financial
institutions, newspaper editorials, investors, etc) as
expressed in thousands of newspaper/magazine
clips during and after my tenure are anything to go
by, then 82% of the public largely agree with the
sentiments expressed by my two bosses. Your
views belong to the other 18% which is okay, after
all, no one is perfect. Five Nigerian newspapers and
magazines simultaneously named us “man of the
year” in one year— unprecedented in Nigeria’s
history. I do not talk about hundreds of awards
and recognitions by various segments of our
society (during and even after service) for
“excellent public service”. I was particularly
touched by the historic award by the staff union of
the Central Bank and the tears in the eyes of many
as thousands of the staff gave me a standing
ovation as I walked the aisle after my brief farewell
speech.
Certainly, the international community (investors,
bankers, scholars, donors, media, etc) took serious
notice of the revolution in Nigeria’s monetary and
financial system. I am recipient of five international
awards as global and African central bank governor
of the year, not to mention dozens of other
recognitions (even after leaving office). The London
Financial Times described us as “a great
reformer”. Even as the global economic and
financial crisis raged in 2008, the United Nations
General Assembly appointed me to serve on the
Commission of Experts to reform the international
monetary and financial system. You don’t appoint
someone who has ‘mismanaged’ his national
financial system to reform the global system. For 8
years until 2012, I served on the chief economist
advisory council (CEAC) of the World Bank, and
together with two Nobel Prize winners in
economics and other experts we met periodically
and advised two presidents and two chief
economists of the World Bank, and in 2011, I
served on the External Advisory Group of the IMF.
Again, these are not positions for ‘mis-managers’.
Since I left office, I have been advising countries
and central banks; and there is hardly any two
months I don’t consult/advise on banking/financial
and monetary policy. I have given these
illustrations to make the point that for every one
Okonjo-Iweala’s attempt to rewrite history, there
are thousands who disagree.
Now, to some skeletal facts of our stewardship! I
will be brief as I have a whole book to tell my
story. As chief economic adviser, I had advised
that our banking system could not support the
private sector-led economy envisioned under
NEEDS. When I assumed office at CBN, I inherited
89 rickety, mostly family banks (all of which put
together were not up to the size of number four
bank in South Africa). Many were insolvent, with
depositors’ money trapped, and 20 more about to
collapse. To get a credit of $300 million probably
required all the banks to syndicate it. For me, there
was a national emergency. I drafted a 13-point
reform agenda, discussed and agreed all the
specifics with the President, and his VP; as well as
my management team at the CBN, and we swung
into action. President Obasanjo promised 100%
support and actually delivered 1000%— which was
decisive. I apologize to you Madam because I did
not brief or inform you about it. We just wanted to
keep it confidential given the sensitivity of the
announcement. It is on record that you never
supported it.
It was both a revolution and a war and most
people thought it was “impossible”, but thank God
we succeeded. For the first time in Nigeria’s
history a policy of that magnitude was announced
and deadline kept with precision. We were
courageous to revoke the licenses of 14 banks,
including those of my friends, in one day. The FT-
Banker concluded that the scale, precision, and
cost of the transformation were unprecedented in
the world. Before then, Malaysia had the least cost
of banking consolidation at 5% of Malaysian GDP.
It did not cost Nigerian taxpayers one penny.
Twenty-five new, stronger banks emerged but the
powerful idea behind consolidation ignited
something even more powerful—‘the race to the
top’. Banks raised more capital, and even banks
like First Bank, Zenith, GTB, etc that did not merge
with others went on capital raising several times.
The consequence was higher levels of
capitalization and within two years, 14 Nigerian
banks were in the top 1000 banks in the world and
two in the top 300 (no Nigerian bank was in the
top 1000 before I came). Even after I left office, still
9 banks were in the top 1000. Our vision was to
have a Nigerian bank in the top 100 banks within
10 years. As I see the new Access bank; Zenith,
GTB, Fidelity, Diamond, UBA, FBN, FCMB, Skye,
Stanbic IBTC, Union, Ecobank, etc, I cannot but feel
that we have taken giant steps forward.
Deposits and credit soared (from barely N1.2
trillion to over N7 trillion); new technologies (ATM
and e-banking) boomed, and banks had 57,000
new jobs; mega businesses emerged (ask any
major operator in the Nigerian economy their
experience with banking and credit before and after
Soludo —the Dangotes, Arik, MM2, oil and gas
operators; etc); capital market boomed and
dominated by the banking sector. It was a new
dawn for Nigerian private sector. I have heard
Dangote twice say that he would not be near as
big as he is today without the banking
consolidation. Many other stakeholders still say it
today. FDI and portfolio inflows flooded into
Nigeria. The world celebrated, and one single
transformative idea has changed the face of the
private sector and economy forever. Banks became
Nigeria’s first transnational corporations with about
37 branches outside of Nigeria.
Nigeria survived the global crisis because of this,
and it is the banking sector that has largely been
powering the economic growth you claim (compare
banks trillions of naira credit for investments in the
productive sector with your government’s
miserable expenditure on critical infrastructure and
investment; much of your borrowing – bonds – is
from the banks). Your privatization of power sector,
several PPP projects on infrastructure, etc, are now
possible because of the mega banks. Today,
Nigerian banks syndicate multi-billion dollar loans
— unthinkable before. Madam, if the consolidation
was ‘mismanaged’, there would not have been any
bank to start with in the aftermath of the global
crisis— as President Yar’adua correctly pointed
out. Even you, during a recent presentation at the
Banquet Hall in Abuja advertised consolidation as
a historic achievement. How can you recognize a
‘mis-managed’ project as an outstanding
achievement? As we say in Igbo, you can’t cover
the moon with your palms.
Let me be clear: the quantum size of the new
banks following consolidation presented challenges
of risk management and supervision. We deployed
all we had and overworked the CBN staff. The
carry-over of bad loans from the consolidated
banks was quickly cleaned up. To the best of my
knowledge, we instituted stringent regulatory and
supervisory regime (consistent with best practices
at the time). We even had resident examiners in
the banks and required bank MDs to personally
sign their reports to CBN. I recall that the former
MD of GTB complained of “regulatory
intrusiveness”. To our credit, non-performing
loans (NPL) came down from 22% in 2003 and
2004 to 6% as at 2008. Anywhere in the world, a
central bank that brought NPL from 22% to 6% over
a four year period does not look like one with a
loose supervisory regime. Name other developing
countries that performed better, Madam. So, on
point of fact, Madam lied. Yours was a reckless
assertion without basis by a Finance Minister.
The banks in Nigeria were supervised by the CBN
and NDIC, but other institutions— international
firms which audited them, international rating
agencies which also examined their books, capital
market operators since most were listed
companies — all had oversight. I put on record
that there was never any information/report of
infractions by any bank which was brought to my
attention and which we did not act upon decisively
during my tenure. I heard the comment that some
of the bank MDs were my friends. Well, my
response is that perhaps as CME you should kill all
your friends operating in the economy or become
their enemies. For the record, my successor
audited all the banks and none of my so-called
friends was indicted. It speaks volumes. Indeed, it
is also a fact that the alleged personal criminal
infractions (including lapses in corporate
governance Madam alluded to) by some bank
CEOs were found out, only AFTER they had been
removed from office. My successor told me that
the comprehensive audit of the banks did not
reveal such infractions. Of course, you must be
God or have a special tip-off from inside to get to
such information while the MDs are in office.
Unfortunately, all over the world, no financial
system has succeeded in routing out all criminal
behaviours by the operators. So, Madam, I
challenge you to provide one shred of evidence
that ‘there was no separation between regulators
and regulated’ or be honourable enough to retract
your reckless statement.
What happened? The unanticipated and
unprecedented crisis of 2008/09 hit the world.
More than 40 US and European banks either
collapsed or were shaken badly (remember the
Lehman Brothers, Fannie Mae and Freddie Mac,
Wachovia, HSBC, Lloyds TSB, Citibank, Goldman
Sachs, even UBS, etc) and hundreds of billions of
dollars were spent to bail them out. The contagion
effects spread like a wild fire, destroying national
stock markets and banks. The nascent (big) banks
in Nigeria faced sudden multiple shocks— liquidity,
exchange rate, oil price, capital market, etc. As oil
prices collapsed, loans to oil and gas became
non-performing overnight; loans to the capital
market became non-performing overnight; etc. Our
first priority was to save the entire banking system
and the economy from systemic collapse. I
assured Nigerians that no bank would be allowed
to fail, and not many people know what it took to
achieve it. Once we had navigated through the
unexpected /unprecedented turbulence, we laid out
a comprehensive plan to clean up the debris which
we presented to stakeholders in Lagos (March
2009). I had pleaded with the Senate to pass the
AMCON bill which we sent to them in 2004. But I
had a comprehensive plan to finish the clean-up
with or without AMCON by the end of 2009,
including second round consolidation and a N500
billion fund (my book will detail all these). I left
behind an 11-volume document of the Financial
System Strategy 2020 (FSS2020) which has
remained the policy roadmap for the CBN/financial
sector since I left office.
I have two analogies for our experience. Ours was
really like an airplane that was cruising and
suddenly meets an unexpected and unprecedented
turbulence. After the pilots and the crew succeed in
navigating through the potential crash and
probably land the airplane, people look in and start
blaming the crew for the broken tea cups, chairs,
and drinks that fell during the turbulence as
evidence that the crew never kept the airplane
clean or serviced it. My second analogy is that of
a sudden earthquake in a region it was never
expected and some houses collapsed. All of a
sudden, the housing authority is to blame for not
requiring earthquake-proof foundations for the
houses. Well, my legal experts call it force majeure,
an act of nature!
To be fair, after every crisis, there are lessons (and
my book will detail what, with benefit of that
experience, we should have done differently). Risk
management— which has always been there— now
took a new centre stage all over the world
following the crisis. But for anyone to suggest that
CBN under me, for one minute, took its eyes off
the ball is, to say the least, ludicrous. The US
financial system literally crippled the world costing
America hundreds of billions of dollars but no one
has suggested that Alan Greenspan is no longer
the great maestro!
AMCON is a big topic (which I will address at a
later date) but her claims show either ignorance or
mischief. She claims that N5.7 trillion of AMCON
funds was used to rescue banks and the ‘bond
issued’ as ‘cost to taxpayers’. Really? I will deal
with the AMCON I envisaged and the AMCON under
you later but let me state that even if 100% of the
banks’ NPL was offloaded on AMCON, it would not
be up to N5.7 trillion. Enough said for now. The
fact is that the Federal Government has not put a
penny in the AMCON fund: the banking system is
financing itself, and together with the sinking fund
by banks, AMCON surely can’t default (thanks to
consolidation that the banks are now big enough
to cough out such funds to solve the system’s
problem). Did you intend to deceive the readers by
refusing to tell them that much of the AMCON fund
is ‘investment’ and not ‘expense’. Am sure you
heard the IMF’s alarm about moral hazard? If you
want, we can have a focused debate on AMCON.
Next, let me briefly respond to a few outlandish
claims. She brags about ‘single-digit’ inflation rate
‘now’ and alleges that when I left office, inflation
was above 13%. I just laughed at this one. In
Nigeria’s history, no governor of the Central Bank
has delivered 24 consecutive months of single
digit inflation as I did until the advent of the
unprecedented global crisis in 2008. It was not for
nothing that the world cheered us as monetary
policy czar, Madam! Perhaps you are also not
aware that we broke a world record by having a
depreciated real effective exchange rate during a
time of export boom and this was at the heart of
our reserve accumulation and the portfolio/FDI
inflows. I resisted the IMF advice to deplete
reserves for liquidity management, and Nigeria had
enough self-insurance to survive the global crisis.
The opposite has happened under you Madam, and
the Nigerian economy is in trouble. Naira exchange
rate appreciated under me from N133 to N117
before the global crisis; and reserves grew to all
time high of $62 billion. For the first time since
1986, the official, interbank and parallel market
exchange rates converged under me. You can’t
match these records!
I hereby challenge your attempt to blame others
for not saving for the rainy day. It is not a virtue
when you are quick to appropriate all the credit
when things are going well, but shift the blame
when they go wrong. You blame the state
governors— who, according to you, have taken the
Federal Government to the Supreme Court—not
that a Supreme Court judgment forced your hands.
For your information, the governors have never
agreed to savings and always threatened court
action even under Obasanjo. Why did we save
under Obasanjo but not under Jonathan? Two
keywords explain it: leadership and integrity.
Governor Amaechi said the governors insisted on
sharing the funds because they found out that you
were illegally fiddling with the savings. So, as
Nigerians still wonder, if billions of dollars are now
‘missing’ under your nose, why should governors
trust you to keep their money? Do the states that
have taken the federal government to the Supreme
Court and refused to save also include the PDP
governors—who are in the majority? If so, then it is
fatal: even governors of your own party, PDP, do
not trust you to keep their money! Furthermore, did
the governors also stop the Federal Government
from saving part of its share? If you ran a surplus
budget at the Federal level, you would have had
credibility to blame others or to say they did not
listen to your advice. The key point is that since
you were running huge deficits yourself, it was also
in your own interest to share the ECA. You did not
show leadership or credibility, full stop!
Next, Madam, I was really embarrassed for you to
read that one of the reasons for declining forex
reserves is ‘oil theft’. Under you as Minister of
Finance and coordinator of the economy, the
basket of our national treasury is leaking profusely
from all sides. Just a few illustrations! First, you
admit that ‘oil theft’ has reduced oil output from
the average 2.3 – 2.4 million barrels per day
(mpd) to 1.95mpd (meaning that at least 350,000
to 450,000 barrels per day are being ‘stolen’. On
the average of 400,000 per day and the oil prices
over the past four years, it comes to about $60
billion ‘stolen’ in just four years. In today’s
exchange rate, that is about N12.6 trillion. This is
at a time of cessation of crisis in the Niger Delta
and amnesty programme. Can you tell Nigerians
how much the amnesty programme costs, and
also the annual cost for ‘protecting’ the pipelines
and security of oil wells? And the ‘thieves’ are
spirits? Come on, Madam!
Second, my earlier article stated that the minimum
forex reserves should have been at least $90
billion by now and you did not challenge it. Rather
it is about $30 billion, meaning that gross
mismanagement has denied the country some $60
billion or another N12.6 trillion.
Now add the ‘missing’ $20 billion from the NNPC.
You promised a forensic audit report ‘soon’, and
more than a year later the Report itself is still
‘missing’. This is over N4 trillion, and we don’t
know how much more has ‘missed’ since Sanusi
cried out. How many trillions of naira were paid for
oil subsidy (unappropriated?). How many trillions
(in actual fact) have been ‘lost’ through customs
duty waivers over the last four years? As
coordinator of the economy, can you tell Nigerians
why the price of automotive gas oil (AGO),
popularly called diesel, has still not come down
despite the crash in global crude oil prices, and
how much is being appropriated by friends in the
process? Be honest: do you really know (as
coordinator and minister of finance) how many
trillions of Naira, self- financing government
agencies earn and spend? I have a long list but let
me wait for now. I do not want to talk about other
‘black pots’ that impinge on national security. My
estimate, Madam, is that probably more than N30
trillion has either been stolen or lost or
unaccounted for or simply mismanaged under your
watchful eyes in the past four years. Since you
claim to be in charge, Nigerians are right to ask
you to account. Think about what this amount
could mean for the 112 million poor Nigerians or
for our schools, hospitals, roads, etc. Soon, you
will start asking the citizens to pay this or that tax,
while some faceless “thieves” were pocketing over
$40 million per day from oil alone.
You alluded to debt relief in your response and
tried to take credit. Well, your CV is honest enough
to admit that your two achievements in office as
Finance minister under Obasanjo were that “you
led the Nigerian team that struck a deal with the
Paris Club” and that you “introduced the practice
of publishing each state’s monthly financial
allocation in the newspapers”. You are right about
the two achievements. Let me put on record that
Nigeria would have secured debt relief under
anyone as Minister of Finance. President Obasanjo
secured debt relief for Nigeria. Much of his first
term was used to get Nigeria back into the
international community and to campaign for debt
relief. Before you were sworn in as Minister of
Finance, President Bush visited Nigeria and both of
us accompanied President Obasanjo during the
meeting. There, Mr. Bush promised to support
Nigeria with debt relief and asked our president to
ensure that he met the conditions of the Paris
Club. Obasanjo mobilized the global political
support and coordinated all of us to ensure that
the government met the check-list of
‘conditionalities’ as required. I spent five weeks in
the hotel with my team (as coordinator/chairman
for drafting the National Economic Empowerment
and Development Strategy, NEEDS).
Some of the reform targets in NEEDS became the
‘conditionalities’ Nigeria was required to fulfil to
merit debt relief. You and I signed the various MoU
with the IMF on behalf of Nigeria (the policy
support instrument). We had a great team at work
and each member of the economic team had
specific aspects of the conditionalities to deliver:
Bode Agusto was in-charge of the budget; Oby
Ezekwesili held sway at Bureau of Public
Procurement and later Minister of Solid Mineral,
and Education (but specifically tasked with
delivering on EITI and procurement reforms); Nuhu
Ribadu was at the EFCC fighting corruption; I was
at the Central Bank delivering on monetary policy
and banking reforms; Steve Oronsaye worked hard
to delist Nigeria from the FATF; Nenadi Usman was
in-charge of the parastatals; El-Rufai held forth at
FCT and in charge of public sector reforms;
privatization programme went on, etc. Did you
know that the IMF wrote President Obasanjo
threatening that there would be no debt relief if the
CBN did not meet some monetary targets, and do
you know the magic we performed to meet them?
Can you tell Nigerians which of the
‘conditionalities’ that you personally implemented?
With the groundswell of political support and
Nigeria meeting all the ‘conditionalities’, debt relief
was assured.
Your major role as stated in your CV was to lead
the team to negotiate the specific terms of the
relief, having fulfilled the conditions. I still believe
that Nigeria should have gotten far better terms
than you negotiated. Of course, with your eyes on
returning to the World Bank after office, I did not
expect you to boldly stand up to the donor
community in defence of Nigeria. Was there a
conflict of interest on your part?
By the way, can you tell Nigerians why you were
eased out as Finance Minister and you cried like a
baby begging OBJ to still allow you remain in the
Economic Management team—- barely few weeks
after the debt relief? Why were you eventually also
removed from the economic management team if
you were so important? Ironically, President
Jonathan has recycled you, with a bigger title and
greater responsibilities. But the difference is that
the team that did the actual work is no longer
there, and the world has seen that the king is
naked.
You are brilliant Madam, but you need serious
help. Having spent all your life in the World Bank
bureaucracy largely in administration/operations,
no one will blame you if your economics has
become a bit rusty. There are firebrand Nigerians
all over the world to draft to service. It is certainly
embarrassing to Nigeria for you to be bothering
World Bank economists to help you with most
basic economic analysis.
Your response on the poverty issue is deeply
troubling. You accuse me of using “2011 statistics
on poverty by the NBS to support his argument,
while ignoring more recent figures”. At least you
did not refute the NBS figure as valid. In the next
sentence, Madam went ahead to note that “as
stated in the Nigeria Economic Report 2014 by the
World Bank, poverty in Nigeria has dropped from
35.2 percent of population in 2010/2011 to 33.1
percent in 2012/2013”. Did you notice that you
have quoted two figures for poverty for the same
year as being equally correct? So, for 2011, was
poverty 71% (according to NBS) or 35% according
to the World Bank? To the best of my knowledge,
the last published household survey by NBS was
in 2011. The World Bank does not conduct
household surveys in member states to determine
poverty incidence. So, when and by whom was the
survey that gave the World Bank figures?
What worries me is that this government is the first
in our history to attempt to manipulate our
national statistics under Okonjo-Iweala. When NBS
published the poverty figures in 2011, she felt
indicted and incensed. She called upon the World
Bank to come and examine the ‘methodology’ and
get NBS to ‘review’ its numbers. Oby Ezekwesili
(as VP Africa Region rejected the call to try to
tamper with a country’s statistics). Once Oby left,
the ‘World Bank’ started talking about ‘new
figures’, without conducting any new surveys. I
was told about it by a World Bank economist, and I
cautioned that it was a dangerous gamble that
would damage the credibility of the NBS. If you
want to ‘review methodology’, you conduct another
survey but you can’t change ‘methodology’
because you don’t like the published figures. No
government in our history has tried it: even Sani
Abacha allowed a poverty survey that put poverty
at 67% under his regime. At this rate, who will
believe statistics coming from the Nigerian
government again? Is it now the World Bank that
sits in Washington and allocates poverty numbers
to Nigeria? Something smells here!
Madam alleges that the NBS—as a parastatal under
the National Planning Commission (under me)
departed from the ‘international standard method
of poverty measurement’. How and when, Madam?
I was in office at National Planning for 11 months
from July 2003 to May 2004. A poverty survey
was conducted in 2004 and the results computed
and published in 2005/2006— more than a year
after I had gone to the Central Bank. Or perhaps, it
was a clever way to divert attention from your
manipulation of published economic statistics. The
NBS published its poverty data in 2006 when you
were Minister of Finance, and you did not question
the ‘methodology’ because the figures looked
good. In 2011, the poverty numbers (using the
same methodology as in 2005/2006) indicted the
government and suddenly, the ‘methodology’ is
wrong. Interesting times!
Now that you decide which economic statistics
published by NBS to accept and which ones to
‘change the methodology’ to give favourable
figures, you can keep feeding your manipulated
figures to your international media circus for the
vain glorious awards to sustain an empty hype,
while Nigerians groan under hardship. We can
actually ask Nigerians whether they are getting
better off now contrary to your bogus figures.
Many of Madam’s responses were comical, but
this one is classic. According to her, the chief
economic adviser and NBS “worked hard to
determine how many jobs we need to create in a
year”, and went on to ask, “why didn’t Soludo do
this when he was CEA?” (Lol!). Madam, any good
economist needs less than 10 minutes to compute
this figure, not the (months? of) ‘hard work’ by
your team. My calculation is that the number of
jobs Nigeria needs to create each year to
significantly reduce unemployment rate to
sustainable levels in the next few years is at least
3 million, and not the 1.8 million by your team. We
are talking about the Nigerian economy, please.
Your magic wand for mass housing is the
Mortgage Refinance Corporation with 23,000
mortgage offers—for a country with 17 million
housing deficit! Then, there is the pedestrian
proposal of a new development bank— financed
with loans from the World Bank, etc? A World Bank
loan to set up another ‘development bank’ where
we already have Bank of Industry, Bank of
Agriculture, NEXIM, Federal Mortgage Bank, etc?
People have totally run out of ideas and can’t see
anything for Nigeria without through the prism of
the World Bank. I will offer you free consultancy on
how to set up a development bank without a World
Bank loan but we don’t need another one now. I
actually gave President Yar’adua a two page note
for a N3 trillion development fund then, and if we
plug your leaking pipes, it could actually be a N10
trillion Fund. I envisioned and set up the Africa
Finance Corporation (AFC)—Africa’s premier
infrastructure bank!
Frankly, I don’t understand why you seem highly
troubled that the Soludo you thought had
“disappeared from the political space” seems to be
still around. Well, let me assure you that I will only
‘disappear’ in God’s own time. I gave credit to two
past presidents who laid the foundation of the
market economy we operate today. You did not
contest or contradict any of my points. Rather,
what you see is that Soludo must be ‘looking for a
position’. Pity! If I am looking for a position, I
would be running around one of the candidates
now just as you are busy dancing Atilogwu dance
at TAN and PDP rallies, struggling to keep your
job. How Yar’adua drafted me to contest for
governor in Anambra and APGA leadership as well
and how I was “stopped” on both occasions are in
the public domain. But I am not deterred for one
minute. Chinua Achebe said that on leadership,
Nigeria is a country that goes for a football match
with its 10th Eleven. I am proud and happy to have
offered to serve my people, and for the service of
Nigeria, I will do it again and again. How many
times did Abraham Lincoln, Obama, Reagan, etc
contest before they got there? I actually encourage
everyone who believes he/she has something to
offer to get involved or stop complaining. I am
happy seeing the increasing critical mass of
professionals (like you) now getting involved. It is
good for Nigeria!
What is at stake is the survival and prosperity of
Nigeria. Next elections are critical, and for me the
key is the ECONOMY. We must offer Nigerians
clarity on the choices before them. Can I propose
a three-way debate with you (representing PDP/
Federal Government), nominee of APC (Utomi or
Fayemi? or any other), and myself (as independent
citizen— I don’t belong to any of the two). Let us
have two bouts of debate between now and 12th
February, 2015 focusing on: CBN/AMCON and the
financial system (if you want); our economy and its
outlook, and agenda/alternative paths to
sustainable prosperity post elections. Choose the
dates and times, and for the sake of Nigeria, I will
fly in. You can invite any of your international
media friends as moderators. I feel the pain of the
180 million Nigerians whose tomorrow you have
carelessly rendered bleak, and when I think of what
the missing trillions could do for them, it becomes
extremely urgent that we all must deepen the
debate. Eagerly waiting for your response, please!
Chukwuma Charles Soludo is a former Governor of
the Central Bank of Nigeria