Whatever the criticism that may be legitimately leveled against the administration’s economic reform policy – and some have been pointed up in this report – it has to be conceded that it is to the credit of our Administration that:
- it has a clear perception of the imperative for reform – the need for a new orientation in national economic management based on creating the right incentives framework for productive endeavors, resource use and allocative efficiency.
- It had the political courage to initiate the requisite reform – particularly, in the difficult circumstances of severe resource compression and payments crisis; and
- The reform program was home-grown.
We frankly admit that the economic reform program in some respects derailed in implementation due largely to the drift towards populism, resultant policy disarray and the transient victory of oppositional forces, particularly from 1990 on wards. In a related vein, we must also admit that we did not keep to the program’s necessary limits and targets that we had freely set for ourselves. The drift towards populism occurred mainly because we were a sensitive listening administration – sensitive to the complaints about a stringent budgetary stance; perhaps, we listened too much. But we preferred to err on the side of listening too much than listening too little. Violation of the limits and targets generally arose from a political transition program and depreciation – which resulted in greater financial expenditure than budgeted. These provide object lessons. If nothing else, it is now clear that success requires resolve in program implementation and a viable reform constituency; the reform constituency has to be sustained and enlarged, with a viable committed cadre – and this condition was lacking. This last consideration connects with the issue of leadership in the large or, equivalently, the elite.
We admit also that, especially with the benefit of hindsight, the abolition of the commodity marketing board system without any institutional set-up as a safety net to take care of the subsystem and its agents in the interim until the full experience of the operation of market forces was an error, particularly in the fragile conditions of early reform. But there was the counter force danger inherent in temporary structures having a tendency to become permanent structures.
We admit also that, considering their importance, the elements of the people-oriented project portfolio should have been accorded priority at the top of the economic agenda, and should have been affectionately and strictly monitored. Their fate should have signaled the fact that inflation should have been resolutely brought under control and not permitted to destroy their proportions.
But it is also true that the reform legacy has operational significance: what sustains domestic society today, despite its evident desolation, is the set of inviolable policy measures taken in that period. Likewise, the categories of discourse and conduct of public administration, developed in that period are still widely in use. For example, it is only reasonable to expect that the Foreign Exchange Market, SAP’s legacy of the democratization of access to foreign exchange, will hopefully, increase in depth and in sophistication; it is highly improbable that Nigerians will accept a return to exchange control and the import listening instrumentality. Similarly, as regard projects, it is gratifying to note that the stand-alone progress such as the OSO condensate and the NLNG projects, which we established, are in robust health and today are the only real money – spinners for government. It is also gratifying that today Production Sharing Contract formatting, VAT, Monetization of Fringe Benefits, privatization and such policies are in vogue.