Is It Nigeria For Sale?

The debate over the planned sale of some of the nation’s choice assets remains overtly heated and controversial. In this report, Ibrahim Apekhade Yusuf, Nduka Chiejina and Biodun Thomas-Davids examine the pros and cons of all the arguments

WITHOUT making light of the issue, the back and forth arguments over the planned sale of some of the national assets clearly remind one of the famous lyrics of the inimitable Afrobeat legend, Fela Anikulapo Kuti, No Agreement, recorded in 1977, which goes thus:

No agreement today, no agreement tomorrow!

No agreement now, later, never, never and ever.

No agreement never, no agreement never

No agreement today, no agreement tomorrow…

Indeed for many discerning Nigerians, the proposal to sell the national assets is tantamount to selling our national patrimony. Thus, like Fela, they are not willing to yield any ground. For them, as far as the issues concern the sale of our national assets, there’s no agreement of sort.

But for the proponents of the sale, this appears to be the only option in sight to rescue the economy from total collapse.

The dramatis personae involved

Clearly, Aliko Dangote, billionaire businessman, may have flown the first kite in an interview with CNBC last September when he impressed on the federal government the need to sell its assets to save the country from its current economic woes instead of going seeking fresh foreign loans.

Speaking on a Bloomberg television interview at the US-Africa business forum in New York last Wednesday, the business mogul said, “Through the sale of assets, through loans from the Bank of China or wherever, we need something like $15bn. We’re having a problem as the reserves are low. The banks, entrepreneurs and everybody are speculating on the currency.

“In my own thinking, we have a lot of assets to sell. We can sell part of the joint venture, part of the shares. You know that government normally owns 60 per cent. We can sell in an open tender, be it Chinese. We can change the term and make it an operating one, just like what we have in the NLNG.

“We also have another asset I think we don’t really need. The African Finance Corporation can fetch $800m easily. My suggestion before was that they should even sell 100 per cent of the NLNG. I don’t think government should be in any business of investing in the liquefied natural gas sector. A company like that, with earnings of $1.5bn on the average, should fetch anywhere between $12bn and $15bn.”

Dangote suggested that the proceeds be invested into the economy to boost development. “Considering the crisis we have today, if we have $15bn and add it to $25bn; that is $40bn reserves. Confidence will come back and government will back it up with proper economic policies where people can see the roadmap. Latest, by the fourth quarter, we will be out of recession. It should be a partnership between government and the private sector. We have all the answers,” he said.

He said if the government boosted its reserves as suggested, the naira would fall to N250 to the dollar and help the economy. “Once we can sell assets and put $15bn together, you would be very shocked at how much the dollar would actually drop. What is happening today is mere speculation,” he maintained.

As if acting out a written script, Dangote got the nod of some eminent Nigerians, including the Emir of Kano and former governor of the Central Bank of Nigeria, Muhammadu Sanusi II, as well as Senate President Bukola Saraki.

Also, speaking at an interactive session with top media executives in Lagos last weekend, the CBN governor disclosed that the country would soon commence the sale of about 15 per cent of its oil assets held by the Nigerian National Petroleum Corporation (NNPC), which is expected to yield an inflow of $10bn for the country.

Emefiele said a team of consultants had been commissioned to carry out a study on the proposed sale. He noted that the country’s income would have been beefed up to $15bn if the assets had been sold earlier in the year.

Last Monday, the minister of finance hinted that the federal government might opt for asset sales next year to boost public coffers.

“We have started working on the 2017 budget, and we are looking at a mixed strategy of debt and asset realisations,” Adeosun told the CNBC Africa.

Naturally, the National Economic Council (NEC), last Thursday approved the sale of some federal government’s prized assets. The NEC, comprising state governors, confirmed government’s resolve when it approved that some national assets be disposed of.

Specifically, in a statement released from his office last Thursday, Vice President Yemi Osinbajo said the step was aimed at “tackling the current economic recession in the country.”

Although details of the assets the federal government intends to sell have not been made public, the National Assembly was expected to pass the resolution of the NEC on Tuesday, September 27, 2016 but failed to do so because of the dissenting voices in the upper chamber.

Projected income from sale of assets

The Federal Government wants to raise $15b from the sale of these assets to ease pressure on the nation’s foreign reserve.