The seven issues that will shape Nigeria's future in 2022
Elections, Petrol and Unicorns
Good morning.
Yes, I’m back after a lengthy break. It’s hard to find an alternative to what Substack does for email publishing, so the transition to a traditional platform stood little chance, if any.
But what a better time to return! It’s the beginning of a new year. The Christmas trees and lights are still out. The leftover turkey (chicken?) is still in the fridge. And the hangover of Detty December hasn’t fully passed. We have a full year ahead of us, a golden opportunity to redefine ourselves and aim for world-class performances and joy.
I started this newsletter as an attempt to understand what’s happening in Nigeria. The operative word here is attempt. After nearly a decade of attending press conferences and conducting interviews across the country and reading millions of words, it isn’t uncommon for me to stumble upon a news piece and pause and wonder WTF is going on here. The more I know, the less I understand. But I’m hoping you will join me on this journey, these attempts to walk through the maze of confusion, to find meaning.
And one final thing before we dive into today’s business: share this newsletter with a fellow confused Nigerian. I’ll publish at least once a week. And I promise it’s worth your time.
The seven issues of 2022
This year, we have to keep our eyes on the ball, to focus on the things that matter. And here are my top seven issues that will shape how 2022 pans out for Nigeria:
1. Race to 2023
Most of the primaries for next year’s general elections will take place in 2022, so expect a lot of fireworks, especially for the presidential tickets. Nigerians are obsessed with the Presidency, perhaps because of how much power is concentrated in the title. But I don’t expect any major surprises beyond the major faces operating within the two leading political parties, the APC and PDP. Of course, talks of a third force will soon emerge, but it’s time-wasting nonsense: building a political structure in Nigeria takes time and is extremely difficult. I think people tend to underestimate how hard it is. But there can be some gains for smaller parties in states and maybe even the National Assembly.
2. The electoral act amendment bill
President Muhammadu Buhari declined his assent on the bill in December and the National Assembly has vowed to revisit it when they reopen. The bill allows for electronic transmission of election results but what the President objected to was the introduction of direct primaries. According to Buhari, allowing political parties to choose candidates by popular votes will be too expensive for the nation. The President won’t change his mind on the issue. So, it’s left for the National Assembly to decide to force the bill into law with a two-third majority vote or cut out the direct primary clause. The former is unlikely because of the President’s hold on the APC lawmakers who are in the majority. Expect the National Assembly to compromise.
3. The end of insecurity?
On January 1, I read out a wire story about two persons dying in a Colorado disaster and my editor dismissed the story’s importance. Two deaths were not enough for an event that happened so far away from home. He was right, but it also was a reminder that human death isn’t a rare thing, especially in a place like Nigeria where hardly a week goes by without news of a bandit massacre somewhere. Or kidnappings. The Nigerian security forces have made huge gains in recent months, but the problem is hydra-headed and has an economic dimension. The Chief of Army Staff and the Inspector General of Police have already charged their officials to expect more attacks in 2022, making it appear as if the dance has just begun.
4. To subsidise petrol or not?
According to the World Bank, petrol subsidy in 2021 is estimated to have cost Nigeria N2.6 trillion, equivalent to about one-fifth of the 2021 national budget. Meanwhile, poor households purchase just 3 percent of all petrol sold in Nigeria. All these cheap fuel benefits mostly wealthy households, concentrated business interests, and criminal enterprises, according to the World Bank. The Bank has advised the Federal Government to cut out the subsidy and instead provide cash transfers to the poor as compensation. The Federal Government appears to have bought this idea, but I’m not sure they have the gumption to do it, especially with general elections months away. Removing the subsidy may triple the price of common goods, deepen unemployment, and, in effect, insecurity. Or it may free up much-needed resources and allow the Federal Government to invest more in infrastructure, education, and healthcare. Actually, both scenarios can co-exist; the problem is do we have a government competent enough to manage the short-term shocks and efficiently allocate the extra resources?
5. How much can we borrow?
Some people like to criticise the Federal Government for excessive borrowing. But like I have argued in this newsletter more than once, debt is amoral. A country can borrow into economic trouble, but it can also borrow to transition from poverty to prosperity like South Korea. It depends on what the money is being used for. One journalism project I’ll love to collaborate on is the tracking of public debt and how these resources are being used.
6. The regulators
Last year was marked by government regulation that threatened to stifle free speech (Twitter ban) and financial innovation (crypto crackdown), but this year should provide more clarity on how regulators are thinking about the future. I’m optimistic because neither Twitter nor crypto is going away soon. A doubling-down on crackdowns without first counting the cost will do the country no good. Nigeria is not alone in navigating the muddy waters of what constitutes ‘correct’ speech or the novelty of crypto. And regulators should learn to watch before they leap.
7. Unicorns in the making
Nigerian startups raised well over a billion dollars in 2021 and while that’s impressive, the numbers can easily double in 2022. Personally, I am expecting one or two more Nigerian startups to attain unicorn status. It’s still early days and the upsides, not just for the tech scene, but the entire country, are massive. Again, one hopes government regulation (okada ban??) and general insecurity don’t dampen investor appetite.
Those are my top seven issues to look out for in 2022. You may notice I didn’t include anything related to COVID-19. That’s because I believe the pandemic is over, at least as an existential threat to humankind. It will take some time for government policies to catch up, but the virus is destined to go the way of the common cold.
However, a worthy mention is climate change. It’s not on the original list because I don’t expect any seismic changes this year. Renewable energy is still out of reach for most Nigerians and gas will continue to be a source of passionate debate. However, expect more flooding and natural events (a locust invasion?!) that threaten food security and livelihoods.
Let me know what you think I missed.
That’s it from me today. Have a splendid week.
So good to have you back. I really missed your brief. Wishing you a happy and prosperous new year.