Emir Muhammadu Sanusi II, speaking to BBC Africa Business Report on Nigeria On Economic Crises

Emir Muhammadu Sanusi II, speaking to BBC Africa Business Report on Nigeria
On Economic Crises
Certainly, if you have an oil producing economy that has not made much progress in structural reforms and the price of oil crashes from over $100 to under $30 barrel, you're going to have major headwinds.
And when you add to that the fact that when oil prices were high the government did not save and with notorious leakages in the system, whoever inherits that situation is going to find that he's been dealt a very bad hand.
So, I think that it's important that as we talk about Nigeria to understand how difficult and how bad the situation was that was inherited by the current government.
On Devaluation
This argument for me has been framed wrongly. It's not an argument of do we devalue or do we not devalue, the Naira has already been devalued.
What is the value of the Naira, it's what you can get for the USD in a free market between a willing buyer and a willing seller, and it is not N197.
What is happening is that the government has chosen to sell its own USD at a subsidised rate to the private sector. That's what is happening.
So if you are lucky, you get something worth N300 for N200, and you save N100. For every $1 billion that the Central Bank sells, it is transferring N100 billion to the private sector. That's what is happening.
So, you've got a high arbitrage opportunity which by the way undermines the government's anti-corruption stance.
You also take away so much money from States and Local Governments because this is money that comes from oil proceeds, Petroleum Profit Tax, Royalties that should go into education and health care for the poor.
So while the president is looking at the pain inflicted on the poor by a higher price of imports, he also needs to look at the pain inflicted on the poor by taking away revenue that could go into education and health care.
On Diversifying the Economy
Until recently when Gen. Buhari came to power, it is very difficult to think back to a government that was really interested in building the economy as opposed to rent extraction.
So what's happening is that you have an administration that is stopping all of that because these opportunities have been removed and we are getting more transparency.
I think people are going to begin to see some focus from a policy perspective on structural reform.
Having said that, there has to be a clarity of thinking, so of you go back to the foreign exchange policy, the government on the one hand says it wants to encourage domestic production.
The governor of the Central Bank says he wants to reduce import dependence, but one would think that the way to reduce import dependence is not to make imports cheaper.
If you subsidise the exchange rate and have a stronger exchange rate, you're making imports cheap.
So you're actually pursuing a monetary policy that undermines your stated structural objective, and I think these are the engagements and arguments that we need to have.
On Corruption
I saw first hand what was happening to the economy and I know this economy was brought to its knees by the massive corruption in the last administration, and I think at least the major perpetrators should be brought to book.
But beyond that, I think we need to ask ourselves, do we have in place systems and processes that allow corruption to thrive if we have corrupt leaders, because Gen. Buhari is not going to be president forever.
So for example, taking away the kerosene subsidy, nobody says subsidies cannot be administered honestly but you can't have a system that relies in having honest people because when you have dishonest people they abuse them.
The thinking that has to be done is beyond looking for these (corrupt) people, beyond recovering money, beyond prosecuting them, what kind of institutional changes do we need to have in processes, systems that will make it impossible for the next president to do the type of things that were done in the past.
On Tackling Boko Haram.
You've got to look at countries like Afghanistan and Iraq to know that these things don't happen overnight.
Therefore, there is now need to go beyond conventional military approaches and strengthen intelligence, strengthen coordination, strengthen community awareness.
What we find in Kano is because we have taught people to be security conscious, I fact to be ready to defend themselves if the need arises, we have a relatively muted situation, but we have to guard against complacency.
If you look at most crises in the world of a regional or religious nature, they tend to conform largely to fault lines that are defined by perceived horizontal marginalisation, where people believe because of their religion they are treated differently.
I am not sure that there has been that type of deliberate marginalisation of Muslims in Nigeria, after all we have had Muslims in government.
Now, Boko Haram is a highly marginalised group that is alienated, that does not have any type of acceptance in mainstream Islam, that does not have any genealogy in Muslim intellectual traditions.
So to that extent, Boko Haram do not represent any kind of position of Northern Nigerian Muslims.
Now, this is not to take away the fact that when you have got poverty and a lack of education, then you create an environment that is conducive to the emergence and survival of groups like Boko Haram.
At this point, there is a need to deliberately put in resources that are aimed at a more even development for this country, and these are broad developmental concerns.
Now it could be Boko Haram today, tomorrow it could become an ethnic issue, the next day it could become anything.
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