Introduction

The 2024 Financial Times Africa Summit was abuzz with excitement as policymakers, business leaders, and investors from across the globe trooped into The Peninsula London to share ideas and chart a course for driving new investments capable of shaping the future of Africa.

From the beginning of the 2-day Summit on 29th October, 2024, it became obvious that Nigeria is a cynosure in the discourse of economic and financial issues in Africa. The reason is not far-fetched. Nigeria is currently taking steps towards restoring macroeconomic stability with reforms that have been accompanied by adverse attendant effects, especially astronomical inflation. This has heralded both optimistic and pessimistic views about the future of the country while the government particularly continues to preach hope. 

To reinforce this, Roula Khalaf(Editor, Financial Times) while officially opening the Summit remarked that all eyes are waiting to see whether the “sleeping giant” would wake. Chinelo Anohu, one of the speakers at the summit would also later emphasise that “Nigeria is such an important country and we need to be careful in what we do because it will sort of affect the rest of the continent”.

The panel on the discourse on the ongoing economic reforms in Nigeria 

The Summit featured a thought-provoking panel session titled “Nigeria-Will Bold Reforms Lead to Restoration of Growth?” and I had the opportunity to cover this particular session for Right for Education. Moderated by Aanu Adeoye(West Africa Correspondent, Financial Times), the discussion brought together two experts: Chinelo Anohu(Senior Director, African Development Bank) and Bismarck Rewane(Managing Director and CEO, Financial Derivatives Company).

What are some of those reforms? Were they necessary?

Chinelo Anohu, previously the Director General of Nigeria’s National Pension Commission, asserted that the two main reforms — subsidy removal and exchange rate stabilisation — are necessary and, as a matter of fact, has formed discourse for many years. According to her, the initial effects cannot be pretty and, as a result of this, many people have shied away from doing them. “Many governments have known that it’s the right thing to do but didn’t want to take the political risk and economic risk of putting those reforms in place”.

The AfBD Senior Director said the focus should, however, shift from the question of the necessity of the reforms to measures that can be put in place to ameliorate the effects of the reforms on the people. 

Sequencing of the reforms and Historical Context of reforms in Nigeria

Bismarck Rwane pointed out the disparity between reforming or making policies in response to a crisis and reforming or making policies in anticipation of a crisis to strategically avert what could be a crisis to take advantage of opportunities. According to him, the historical context shows that Nigeria is accustomed to the former approach. 

“One thing that is also historically consistent about reforms in Nigeria is that the ones that were accepted were ones that actually transfer growth and income to the people. The ones that were resisted took income away from the people, especially when they see that the proceeds are not being efficiently deployed or the money is stranded and there is a negative multiplier effect”, Bismarck said.

Challenges of cushioning the effects of these reforms through social safety net

Chinelo Anohu observed that the major challenge of driving an effective social safety net amidst the effects of the ongoing reforms in Nigeria is the lack of data accuracy and integrity in terms of the identity and population of the country. 

“There are so many undocumented people in Nigeria… Cash Transfer without names, that is National Identity Number, becomes almost a recipe for disaster”.

The efficacy of the reforms 

Bismarck Rewane posited that the success of the reforms depends on addressing the consequence of the reforms, the consequence of wrong sequencing and the consequence of not having a holistic approach, and these must be addressed quickly.

Both panelists emphasised on the exigency of institutional reform to the successful drive of economic reforms. These, according to them, include the Legislature, Judicial system, Police, Financial System(CBN, Tax Authority, etc) and electoral commission.

Bismarck asserted that “Good leadership and good policy would fail without good institutions”.

They also noted that good and strategic communication is important to reduce resistance among the people, as resistance toward new reforms could occur as a result of lack of communication.

Conclusion

As Nigeria strives at the crossroads of necessary economic reform and policy decisions towards the prosperity of the country and the people, whether it will lead to the restoration of growth or not, depends on the government’s proactive and sincere steps towards addressing significant issues surrounding or arising from the reforms, to give the people leap of hope and assurance that they are not suffering for suffering sake.

In the near future, we will see if the reality of Nigeria would align with the words of Chinelo Anohu in response to the inquisition of the panel moderator, Aanu Adeoye, on the important marker to see when the reforms are working; “when you come to a country that’s working, people are not fighting to eat, people are not fighting for basic things like light”. 

Editor: Dessalegn Masrie, Ethiopia

Chief Editor: Marian Gloria Gyamfi, Ghana

Please contact us at seminar@rightforeducation.org/ marian@rightforeducation.org , if you want to get involved.