Efio-Ita Nyok|27 September 2016
Owing to the economic recession Nigeria is currently facing, the Federal Government in listening to the advice of Africa's richest man, Aliko Dangote, and the President of the Senate of the Federal Republic of Nigeria, Bukola Saraki is beginning to contemplate the temporary sale of our national assets for $15 billion like the NNPC, LNG, etc to salvage the economy. This decision by the federal government has polarised Nigerians along lines.
In Cross River State, an Atlanta-based international development consultant, Mr Princewill Odidi, had on the 23rd of September asked through his social media accounts whether the assets be sold or not.
Below is Princewill Odidi's phrasing of his social media post: 'A man who owns a house where his entire family lives, at a point where he is financially down, is it advisable to sell the house and pay his debts and possibly rent a smaller house and be debt free or continue to own the house amidst debt and hardship. What is your personal opinion for the government to sell Nigeria's national assets like NNPC and LNG plants to bail Nigeria out of recession? Is it advisable to sell these assets and use the proceeds to bail out the sluggish economy, or do we continue to own the assets and keep praying?'. Majority of the persons who reacted to Odidi's thread where articulately against the idea. This is a cross section of some of them and their perspectives to the proposal:
Goddy Michael Ogar
In fact, Nigerians are already tired and fed up with the inconsistency and daily blatant lies of this administration. At one point, they said they were set to inject the sum of three hundred and fifty billion Naira into the economy to cushion the effect of the recession. At another point, they increased the amount to over four trillion Naira. Yet at another point, they were talking about going to borrow and now, it is to sell NNPC and LNG. In my candid opinion as well as advice is that they should just better sell the entire country or will they not get a buyer?
Missang Oyama
The most nauseating piece of news making the rounds across the landscape is the unwholesome idea that the government should sell the NLNG. For me, that's the most bizarre proposal or initiative anyone can bandied around. I want to say this and I stand to be corrected: NLNG is the most successful JV in Nigerian history. The government holds 45% stake in the company. Remember that NLNG has always come in handy in terms of rescuing the country at very critical times. The very first bailout funds that the FG used to rescue the states came from the savings in NLNG. The company is highly viable and very profitable even at this time of recession.
Nigeria is blessed with billions of cubic meters of natural gas deposits. Across the world, Nigeria is the 9th richest nation in terms of natural gas deposit. Nigeria has the capacity in sub- sahara Africa to become what Russia is in Western Europe with regards to gas provision across the region. So, how do you sell such a national asset because of short term problems? It doesn't make any economic sense. All the government needs to do is to work with its other JV partners to enhance further viability of the NLNG. There is a cash crunch in the economy, that I know. But selling a viable national asset like NLNG is certainly not the way to go. The consequences of such a decision if effected ,will be too dire for the country in the long run.
Peter Offem Ubi
Is the financial trouble permanent or temporary? Do you assume only selling of his asset will bring Nigeria out of financial troubles forever? I cannot imagine selling of such an important asset of the Federal Government. There are other things the government can do to stem the problem.
Ceejay Ojong
While aligning myself fully with what my brother and fellow economist Missang Oyama has opined I should add that the way forward could include but not limited to the following set of policies:
1) Draw down on external reserves and the Excess Crude Account to fund targeted public sector investment opportunities that have potentials for generating returns to the economy and paying back the amounts so drawn. Recall that Nigeria has moved to a flexible exchange rate without need to defend the Naira at a fixed exchange rate.
2) Outlaw black market (so-called parallel market) exchange rate totally. There should be only one official exchange rate as is obtainable in most advanced economies. The Bureaux de Exchange (BDCs) operators could be formally registered with the CBN and required to provide nationally acceptable identification documents for buyers and sellers of forex.
3) Idle funds in TSA with the CBN could be on-lent to priority sectors at single digit interest rates. For instance incentives can be provided for items banned from accessing forex for imports to commence local production. E.g: Toothpicks, Tyre manufacturing, Leatherworks to provide school shoes and belts for students and for the military/paramilitary, revamping the textiles industry, local production of syringes & needles and so on.
4) The FGN equity portions of the national assets could rather be used as collateral with a fixed charge on the particular asset to obtain foreign loans from capital rich industrialised countries that have near negative interest rates at this time. However the loans must be targeted to specific productive ventures with high potential for repayment.
5) Apply serious expenditure switching, cost-cutting and demand management policies. Etc, etc.
Francis Eyong
I wanted to just pass by but reading through the contributions of our friends here I'm tempted to make a little in-put. My take is that the typical Nigerian is not patriotic.The decision to sell these assets is not altruistic. It's typical Nigerian way of finding short-cuts to problem solving rooted in corruption. Now, tell me; is this the first time we will be selling national assets. Where are Nitel assets, Federal secretariat at Ikoyi, Federal Palace Hotel, NEPA, Daily Times, NICON Insurance, et al. Can't really exhaust the list.
Yes, we sold them, have the proceeds of sale bettered the lot of the ordinary Nigerian? We're merely pretending and orchestrating in the circus show we're used to. Nigeria saw oil boom. We said our problem was how to spend the petro-dollars. Obasanjo and Jonathan saw good dollar in-flow when oil price was continuously peaking at the international market. What did they do with all the income. Sharing to Governors and looting jambore! Did the rise in oil price change our lives positively? A very big and CAPITAL…NO!.These national assets we're going to sell again (as if this is our first time), will the proceeds surpass the petro.trillion dollars we've been making. Oh Nigeria! God will surely judge our "leaders". I can swear by anything that even if we sell all our assets, including Aso Rock Villa, the lot of the common man will still remain the same while the politicians and their associates and families will continue to loot the treasury blind.
Christy Nsan
Selling those national assets is a very wrong option. If the situation is as bad as that, that govt. can contract or lease for a period time and source for other money generating avenues to complement the revenue. But the question is, shall we fine sincerity in them?
Ugbe Tony
Not long ago, I realised PMB as a former military head of State with constant financial emoluments could not transform his normadic farm in Daura to a Modern Diary Farm as obtained in Europe & middle east, Then I realised I am guilty for supporting a man who is not smart in thinking to save or transform Nigeria. My heart bleeds because Nigeria can't succeed on a wrong structure and an analog leader no matter…
Patrick Undiandeye
you may recall that for the past months, the major source of revenue is NLNG, now if such assets are sold and the proceeds are not invested in productive ventures, the country would be worst for it. bearing this in mind and taking into cognizant what happened when some government assets were pravitized, I will never subscribe to the sale of government assets
Frank Osang
Nigeria has many houses in the first place. Why sell the house that brings rent regularly? Will the country begin to produce and export to other countries? Citizens of countries sold their gold in period like this. Right policies and inclusive governance will stimulate the economy.
Achu Stephen Achu
If you sell properties when you are broke, there are possibilities that u are going to be at the losing end.. Nigeria is broke but that doesn't not mean it can borrow. Even with stable economy USA still top the chart of countries with high debt. we should instead review our policies abegi… to me we are not even in any serious recession! If we were companies,banks etc would hv done massive sacks to cut down cost. Have we forgotten what happened to USA so soon when they were in what I call real recession and how they managed through? Let's stop deceiving ourselves and be quiet already…
Eteng Okah
The problem with us is too many sycophants.you will discover at the end of the day, those clamouring for sale of the nations properties will be the beneficiarise of it. My question is these, what if these propertise are sold and the proceed could not meet the demands what happen. Nija should not be liken to a debtor who sold propretise to offset debt and the debts still stire on his/her face. Bros lets shine our eyes well welloooooo.
Missang Agbor
Have you ask your self who the buyers are? Hmm, don't worry one day you will here that one selfish senator bought d oil factory and use one white man for coverage. Those people are ambassadors of poverty there are all merchants of loot.
One Chimezie Charles Harry had noted elsewhere that:
1) the NLNG as at today, is the most lucrative, most profitable, and so far the only world class asset Nigeria can boast of.
2) In terms of profitability, the NLNG generates an estimated profit of $1.5b annually to the Nigerian coffers.
3) Nigeria is ranked seventh in the world and first in Africa with natural gas reserves base totalling 188 trillion cubic feet, TCf, as at may 1, 2015.
4) Nigeria's natural gas is regarded as one of the best in the world with low hydrogen Sulphide (H2S) and Carbon dioxide (CO2) impurity level.
5) The economic problem we want to fix at the moment is a short term problem which demands a short term solution.
Is NNPC, LNG, etc worth selling to fix a temporary economic palava?
Efio-Ita Nyok
Is a Blogger & the Editor of NegroidHaven.org
