The Political Economy of Restructuring the Nigerian Federation: Let Us Sit Down & Craft A New Constitution That Provides for A Stable, Equitable & Just Polity
by Prof. Chukwuma Soludo
Former Governor of Nigeria’s Central Bank, Prof. Soludo, utilized his keynote speech at the Igbo Lagos Foundation’s event held at the Nigerian Institute of International Affairs (NIIA), Victoria Island, Lagos to proffer his unique insight on the urgent need to Restructure Nigeria before an inevitable catastrophic collapse supervenes. The speech was comprehensive in its analysis of the issues at stake, the plausible solutions posited and the preferred sequence for their implementation.
Our editorial team has edited the speech into PDF for easier portability and better fidelity. Full text of Prof. Soludo’s momentous speech can be accessed by clicking on https://goo.gl/9ZbPgB.
Whoever can are advised to find the time to peruse this speech in its entirety because of its didactic and analytical qualities. The intended target audience may be the Igbo elite gathered at the Lagos event. But the message content is for all Nigerians, in particular, and the world, in general. The former apex bank boss eloquently conveys the fact that Nigerians, in fact, have a clear understanding of what ails the post-colonial nation as well as what it would take to break the jinx keeping Africa’s most populous country from thriving as it ought to, based on its abundant endowment in human and material resources.
Emphasis must be placed first on the building of national institutions of which the Constitution must be seen as the primus inter pares. The economist/politician posits that “Nigeria’s meta institution, its Constitution (legal-political-governance architecture), is designed to share and consume the oil rents and has perverse incentives for a productive economy”. In order to shift the polity’s focus on sharing the national cake and consumption, the enabling constitutional provisions embodied in the current 1999 Constitution must, as the first order of business, be scrapped and replaced. It is because of the imposed errant 1999 Constitution that the Nigerian polity is afflicted and incapacitated by the “combination of the Dutch Disease syndrome and the Lottery Effect produced what I (Soludo) refer to as Nigeria’s Oil Structural Disease“. Due to this legal document, “The incentive system (which had spurred spectacular growth during the 1st Republic) tilted towards a culture of cake sharing and consumption – an indolent entitlement culture, and the earlier culture based on hard work, competition and cake baking died”.
Prof. Soludo’s recommendations for the way forward is predicated on the truism that “a system designed for consumption cannot be expected to become efficient for competition and production in the 21st Century (world)”. Sadly, many people miss this point. He prefers what he calls “hybrid restructuring” to the alternatives of “soft restructuring (tinkering with amendments of the 1999 Constitution) and hard restructuring (confederation or outright independence for any desiring part of the country)”.
He was, however, astute enough to note that there exists genuine fear in some constituents that once the Restructuring train sets in motion, what emerges at the end of such an open-ended process could be unpredictable. So, fear of the unknown constitutes one of the impediments to Restructuring. But even more important is the opposition emanating from minders of the status quo whose sustenance and sense of relevance are dependent on the current rent-sharing and consumption paradigm.
He summarized his preferred hybrid restructuring into three categories:
- Political-governance arrangements that ensure the participation and ownership of the Nigerian project by all segments of the federation – a stable and more efficient system which is fairer, more equitable and just;
Devolution of powers according to the principle of subsidiarity and variable geometry —away from the current system of unitary federalism, with its suffocating concentration of powers and responsibilities at the inefficient center; and
Fiscal federalism that is consistent with (b) above and which alters the incentives faced by economic and political actors, thereby unleashing the competitive spirit, hard work, innovation and efficiency which are the hallmarks of prosperous economies of the future.
He concludes by cautioning that, when all is said and done, the preferred Restructuring must not be seen just as “an optimization process where efficiency counts”, but should be understood to be a framework in which all the major constituents can see a clear path to a future of peace, stability, and equitable socioeconomic development.
Soludo notes that “so far, it seems that only those canvassing for hard restructuring have mustered some grassroots followership”.
“Beyond the elite declarations at sporadic events, where is the constituency and organized pressure group(s) for hybrid restructuring?”, queried the renowned economist and banker. To him, “restructuring is not only progressive politics but excellent economics”.