Friday, 23 July 2010

NLC AND LABOUR UNIONS: ALWAYS IN OUR OVERALL BEST INTEREST?

Labour unionism in Nigeria is not a recent development. However, over the past 2 decades or so, the various labour unions in Nigeria have been in the news as at no other time in our history. The popularity of the unions came to a crescendo in the late 80’s, during the regime of Ibrahim Babangida. The SAP strike and riots of 1989 was one of the most coordinated strike actions in the nation’s history. The strike of 1993, over the annulment of the June 12 elections was another strike action that literally brought the nation to its knees. Since then, the labour unions have engaged in one strike action or the other with increasing regularity. Perhaps this has been buoyed by the successes of the strike actions of the SAP and June 12 saga. From the University lecturers to the medical doctors to nurses, Nitel staff, PHCN staff, NLC etc, all of these and more have gone on strike at one time or the other to press home their various demands. Whilst most of these actions have been localized and restricted to the specific sectors and issues involved, in recent times the NLC in particular have been directed at changing the direction of general economic policy and herein lay my interest.

It is a known fact that the Nigerian economy is grossly underperforming. There are many causes for this, but a significant reason is the fact that Federal and State governments control a huge chunk of the country’s economic activity. Unfortunately, this huge chunk has been mismanaged over the years, thereby leaving the economy in the doldrums. In an attempt to correct the imbalances to the economy caused by inefficient government departments and companies, efforts have been made to privatize many companies hitherto managed and operated by the government. However, in many cases, these attempts have been met with stiff resistance from the NLC. In particular, issues relating to privatization of the nations refineries, its electricity infrastructure, roads, telecoms and airports have been met with unusually strong opposition. The position of the labour unions has usually been that some of these sectors are so interlinked with the common man that putting them in private hands to be run for profit motives would result in suffering for the masses. In other cases, it has been argued that putting them in private hands would result in “national security issues” as in the case of telecoms and airports; however I find these arguments, especially the latter one, to be outdated, given that no country operates in isolation anymore.

I have reason to call into question the competence of the NLC to make such assertions. From experience, I have concluded that in everyday discourse, only a minute proportion of the discussants are really competent to speak on any subject matter. A classical example would be in matters concerning the Super Eagles. When they perform badly, everyone is suddenly a coach and prescribes a “better” option for the way forward. “Oh, Okocha should not have started”, “Why didn’t he bring on Kanu?” people say, forgetting that the same Kanu had been touted by the majority of Nigerian’s as being too old and slow to make the world cup team of any serious nation! Another good example is the typical newspaper stand. They are usually flocked by all manner of people, most of who have not had a decent education or specialized in any field. Yet, just listen to them talk! They usually have an opinion and solution to every headline on every newspaper on any matter under the sun. I find that the NLC most times falls into the same category.

As someone schooled in Accounting, macro and micro economics, corporate finance and international finance, and given the social situation we find ourselves in, I find that privatization is one of the best things that can happen to most of our state owned enterprise. First the change of ownership to private hands will reduce the corruption which these enterprises are used to perpetrate. NNPC and PHCN are a case in point. Secondly, the improved efficiency will mean that the services will be provided faster, and in some cases cheaper and thirdly, the privatized industries are likely to provide far more jobs for the teeming unemployed than if they were left in public hands. The telecoms industry is always my favorite case study. In over 3 decades, Nitel provided us with a paltry 500,000 lines, but the GSM companies have provided us with over 40 million lines in 10 years. It took about 6months (if you didn’t know anyone and were also lucky) to apply for and receive a Nitel line back in the day. Today, you can get a GSM line in minutes. Nitel as far as I know never made any dividend payment to its owner, the Federal Government, but the GSM and CDMA companies pay taxes to government running into hundreds of billions of Naira. At best Nitel provided 10,000 direct jobs and very little indirect jobs. Today, I would expect that direct jobs provided by the telecoms companies at the very least matches the 10,000, but the indirect jobs probably runs into the hundreds of thousands, from those hawking recharge cards, to those operating call centers, to advertising agencies, builders of masts, those who lease out generating sets, provide security services etc. With these obvious benefits, why on earth would an NLC be so against the final sale of Nitel? Any student of economics should be able to conclude rather easily that the overall benefits of the privatized telecoms industry far outweighs the burden of keeping the staff at Nitel unproductively employed.

My take on this is that the NLC continues to struggle with government simply to remain relevant and not necessarily to make your life or my life better. In a nation as corrupt as Nigeria, I rather doubt that corruption has not also found its way into the various unions who are supposedly fighting on our behalf, oblivious that in many cases their actions actually cause more long term suffering to Nigerians.

Another interesting case study is the brouhaha surrounding the privatization of PHCN, which the unions seem to be against. It is common knowledge that PHCN is corrupt and inefficient. It is also common knowledge that stable electricity will do wonders for the Nigerian economy by boosting its productive capacity and by opening a new vista of opportunities for provision of services. It is also common knowledge that all companies, big and small, and a large amount of private residences use private generating sets for varying lengths of time on a daily basis. It is also common knowledge that self generated power is about 10 times more expensive than the current national tariff. I therefore find it puzzling that whenever the issue of PHCN’s privatization comes up in public discourse, the electricity union’s rise up to say that all they require is more funding and that are capable of managing the company. A company they have failed to manage properly for the last 30years!!?? One does not need a soothsayer to tell that the current staff of PHCN cannot turn around the fortunes of that company. Discussion with their staff whenever I go to pay my bills indicate that they do not possess simple logic, lack integrity, proper work ethic and honesty, are ages behind in current technological advances in the sector, are not proactive, do not have the capacity to design and implement processes and procedures that will ensure the system works properly and are generally un-trainable.

If this is the case though and we all know it, why then is there so much resistance to handing PHCN and its successor companies over to private companies who will have the capacity to manage them effectively and far more efficiently and import far better technology and deploy current best practices? One would have thought the overriding interest would be to make electricity available to the nation and by so doing oil the nation’s path to economic recovery. If electricity is really the opium for our economy that many people are saying it is, then it is likely that the increased economic activity it will create will bring about many more jobs than could ever be lost by privatizing PHCN. This is simple economics, and has already been proven to be true as described in the telecoms sector. This does not even take into account the improved incomes people in other sectors will generate as a result of regular electricity, more expensive or not. And I see no reason why this cannot apply in other sectors as well - even downstream petroleum!

It seems that in fighting to keep a “few” employed at some of these state owned companies, the overall impact of these labor agitations as regards privatization is actually worsening the lot of most other Nigerians. The intention is not to make it appear that the unions are not useful. They certainly are, especially when it comes to smaller localized issues their workers may be having with their employers, but when it comes to trying to get involved in directing national economic policy, I really do not think the NLC is doing us any favors.

Friday, 18 June 2010

SOUTH AFRICA- THE NEW GIANT OF AFRICA

Growing up, we were all constantly fed with the rhetoric of Nigeria being the “Giant of Africa” and a “Nation with great potential”! However, the more I grow older and wiser and continued to analyze this country, the more I realized that Nigeria is far from being a great country. The definition of a great country may vary slightly from one person to the other, but I expect all the definitions to contain some of the same ingredients. I expect to hear that a great country is one that protects its citizens, where the political system is relatively stable, one that provides quality education and healthcare to its people, one where basic infrastructure such as water supply, electricity and an efficient transport system are available and work efficiently regardless whether or not they are provided by the private or public sector and one where the rule of law reigns and citizens can find redress in the law courts.

Unfortunately, all of these things are currently not ingredients of the Nigerian state. Roads, water, healthcare, education, security, access to justice and electricity (to mention a few) are not readily available to the majority of Nigerians. Maybe they once were, but no more!

Not too long ago, Nigeria was shunned by the President of the United States of America, who chose to visit Ghana over Nigeria, despite the fact that Nigeria is supposedly pivotal to its energy needs and at the forefront of peacekeeping around the world and more importantly on the African continent. Following this was the scathing remarks of the US Secretary of State on her visit to Nigeria, showing just how far down the rungs of greatness Nigeria has fallen. The sad part of all of this is that those in government have not realized that Nigeria is longer great, if it ever really was. Nigeria was certainly once rich, but great!? Of that I am not so convinced.

We continue to beat our chests and boast of the being the 9th largest producer of crude oil in the world, 6th largest exporter of the product and the largest in Africa. We even boast of having the largest TV Network in Africa, as well as the largest political party. But in the 21st century are these supposed to be claims to fame? How about having a vibrant, robust and diversified economy that creates jobs for its people? What about having a functional political system? Is having a functional educational and healthcare system a bad thing? Is it impossible to be able to expect that our roads be smooth and motor able without fear of where the next pothole will be? Should a nation with the kind of coal, hydro and thermal resources that Nigeria possesses not expect that it will be able to enjoy 24 hour electricity? Is it out of place that almost 40years after the first bridge was built across the river Niger at Onitsha, that we should have a second one, regardless of who builds it? Many other examples of the failure of the Nigerian nation abound – Nigerian Airways, Nigerian Railway, National Stadium Lagos, National Theatre Lagos, Power Holding Company of Nigeria, Nigerian Telecommunications Plc, Nigerian National Shipping Line, Aluminum Smelter Company of Nigeria, Nigerian Coal Corporation, National refineries, Nigeria House in New York, Nigerian Mining Corporation and many more. It seems everything “Nigerian” is bound to end up in gloom and doom.

However, even if the Nigerian story does not inspire much hope in the heart of the average African, another country is at least making up the gap and standing up strong on behalf of the continent. South Africa is currently hosting the world and my word, what a showpiece!! The stadia were built in many cases ahead of schedule and below budget. Just to put it in some perspective, The Durban stadium (the one with the arc) cost $200mln, about N30bln. Yet, we built the Abuja stadium, in 2003, for about N50bln! Hmmm! I thought inflation made things more expensive!! And whilst the Durban stadium is state of the art and visually breathtaking, the Abuja Stadium, whilst still being a good stadium, is rather basic in its aesthetic design. Bottom line, South Africa has made the whole continent proud and FIFA had from the turn of 2010 been telling the whole world that South Africa was ready to host the world. This is in stark contrast to when Nigeria hosted the U-17 tournament a few months ago. Although the scale of that tournament was much, much less than the world cup, FIFA had palpitations from the build up right through to the end of the tournament, fretting about minor things from the state of dressing rooms and media offices to more serious issues of the possibility of floodlights going out (which eventually did occur) and rain literally carrying the playing turf away.

This is just symptomatic of the differences between South Africa and Nigeria. I struggle to find any parameter where Nigeria leads South Africa. Electricity supply, political stability/maturity, educational standards, quality of healthcare, financial services, manufacturing, mining, transportation, tourism, broadcasting, urban development, intellectual capacity, police capability just to mention a few, are some of the areas where it is obvious to any onlooker that we are nowhere near South Africa. Indeed our economy is gradually being taken over by South African corporate imports. Shoprite, MTN, Dstv, Stanbic IBTC, Alexander Forbes and Protea Hotels are examples of South African corporate bodies that are operating successfully within the Nigerian space. South Africa is the largest economy in Africa. It is a world leader in coal, diamond and gold production. The country has just launched a high speed train service in Johannesburg. The country has the most developed financial services industry on the continent. Its educational facilities are world class. The country boasts of 4million tourists every year. Cape Town is one of the most beautiful cities in the world. Most of us who can afford it watch South Africa’s Dstv. If we do not lead in any of these areas, how on earth do we manage to justify our stake to the claim of being the Giant of Africa. Perhaps it is by our leadership in police brutality, political assassination, illiterate and incompetent political class, advanced free fraud, death traps called roads, failing banking system, comatose economy and absence of electricity despite huge volumes of gas!! Certainly not! The world is not interested in all of these things!

As usual we have managed to pull a veil over our eyes in this country. Rather than our leadership taking the steps to really put Nigeria in a position to begin to compete for that title, we put our heads in the sand and mindlessly proclaim our greatness. Instead of sitting down to work on the Electoral Reform bill, the Freedom of Information bill and the Forfeiture of Assets bill, 65 of our Senators have flown to South Africa to watch the world cup at taxpayers’ expense. Unfortunately for them, it seems that Nigeria will be coming home early. I say unfortunately because I figure most of them would have made plans till the 2nd round of the competition, on the assumption that we would get that far. However, knowing them, it would not be out of place for them to find some other excuse to stay behind even after the “Super” eagles have returned home. A popular one is likely to be that “we are staying back to understudy the organization of the world cup in order to enable us host big events in the future”. What a bunch of clowns!! And to rub salt into the wound, they do not bloody care!! And with the caliber of our political class, it is not surprising that we are where we are as a nation? Take a sample of the members of the Senate or House of reps of more serious countries. They are mostly occupied with men of timbre and caliber-people whose intellectual capabilities are not in doubt. Just listen to the typical member of the American Senate speak. Or a member of the British House of Commons! The quality of speech or debate that goes on in our National Assembly is of such a low quality that it is no surprise they have not been able to pass more than a few bills in the last couple of years. Just a few days ago, I was listening to BBC radio and they were speaking to the Nigerian Ambassador to Venezuela, trying to discuss the cultural linkages between the people of Africa and South America. My word!! The poor quality of speech, logic, general knowledge and awareness of this gentleman was shocking! I was so embarrassed for Nigeria that I had to turn off the radio.

We are constantly fooled by our supposed oil riches, yet Nigeria with all its 2.3mln barrels of oil per day has a per capita GDP of about $2,400. South Africa on the other hand, that produces NO oil, has a per capita GDP of over $10,100. To put it in further perspective, Algeria with less oil production than Nigeria has a per capita GDP of $7,000. This amplifies the point that rather than deceive ourselves, our leaders need to appreciate that the country is not anywhere as rich as it seems to be and as such, should be doing so much more than they are currently doing to develop a viable and robust economy.

So in your mind is Nigeria the Giant of Africa? All things considered, my answer to that is far from it! South Africa, the real Giant of Africa should please stand up and be counted. And the sooner those in Aso rock and Abuja realize that we have long been displaced from that position and begin to take urgent steps to remedy the situation, the better!!

Wednesday, 10 February 2010

AND A WOMAN SHALL RISE TO DELIVER NIGERIA…!

I have often wondered at who would make a better President for Nigeria between a man and a woman. The closest this country has ever come to having a woman be at the forefront of political leadership was when Mrs Patricia Etteh held the position of the Speaker of the House of Representatives, effectively making her the number 4 citizen of the nation. However, being the number 4 citizen is all well and good, but is a certainly a long way off from being the number 1 citizen, on whose shoulders lie the full weight of the nation.

Even though Patricia Etteh is widely regarded to have failed in her time as the speaker, as well as doing the cause of further advancement of women in politics and nation building no justice, there are still compelling reasons to believe that a woman may perhaps be the one to put this country on the path that it truly deserves to be.

Women rose to unusual prominence during the second tenure of President Obasanjo. Never before in Nigerian political history had so many women served in government at such a high level. And not only did they serve, but their performances during that period remain as some of the best we have seen of any of our public officials since the return to democracy. Ngozi Okonjo Iweala brought a fresh and well-educated perspective to the job of Finance Minister, which her experience at the World Bank, garnered over many years, had no doubt prepared her for. The woman hit the ground running and through her extensive contacts was very instrumental to getting an unlikely debt relief for Nigeria, despite the view in the western world and media that Nigeria did not deserve any form of debt relief. Although this act was well lauded at the time, it may go down as one of the most unappreciated and fundamental things Nigeria as a whole has benefited from democracy in 11years. Following the debt relief, Nigeria’s credit ratings improved, more foreign investment came in and Nigeria’s foreign reserves were able to rise, thus significantly improving the value of the Naira for the first time since the early eighties.

Likewise, Oby Ezekwesili came in and shook up the procurement process of the country, arguably a source of large-scale corruption, via the Bureau of Public Procurement. Despite the fact that the BPP was widely labeled as the reason for delay in many projects taking off, Oby stuck to her guns so much so that many reviled her. Of course many of us now know that the reasons for project delays had little to do with Oby’s BPP and more to do with the incompetence of the various ministry staffers, who never thought to plan on time. Oby’s efforts at the BPP undoubtedly saved the country a huge amount of money. Who is the head of the BPP now? I cannot readily recall who it is, although I’m aware that the individual is male, a possible indication that the incumbent is either not pulling his weight on the job or at the very least is not as passionate about fighting the cause.

Another success story was Dora Akunyili. Though not in the executive arm of government, her activities at NAFDAC endeared her to many. Despite the fact that she was very vocal and for many, excessively so, the results of her efforts were much more vocal and louder than anything she might have said. She was so efficient at her job that assassination attempts were made on her life and the offices of the agency were attacked and burned down on more than one occasion, obviously by those whose ox had been gored by her crackdown on fake and adulterated drugs. So trusted were NAFDAC’s laboratory analysis on foods and drugs, that reports suggested that some other West African countries, devoid of the quality equipment at NAFDAC’s disposal, made a seal of approval from NAFDAC a pre-qualification for import into their own territories! In effect, NAFDAC had become the de facto NAFDAC of those other countries as well!!

And what were the men up to in that administration? Well, really…. nothing to write about!

It would appear that these three women alone have actually delivered better performances than all the men before and after them and that is really shocking! My theory as to why that is suggests that women are more motherly and thus appreciate the sufferings of others and take the necessary steps to do things right, are less prone to corruption, especially when their husbands are able to take care of them and therefore do not see the need to amass huge amounts of money for themselves. Also they possess more attention to detail and as such are able to fine tune processes and procedures that result in leakages. The men on the other hand spend too much time politicking, are always trying to amass money for their families and generations unborn as their “breadwinner” role would have them do and could care less about the fine print and therefore do not spot the many ways that leakages occur, other than the ones they cause for their own benefit.

And of course, if the above fails to provide enough evidence, Dora’s recent submission of a memo to ask the Federal Executive Council (FEC) to request our ailing President to transmit a vacation letter, which would enable Goodluck Jonathan to act as President, something all the other male members of the FEC did not have the pants nor the balls to do, drives home the point that women are more likely to be able to lead this country out of the darkness and into the light.