By Udeme Clement
INTERVIEW IN BRIEF
Dr. Shamsuddeen Usman is the Minister, National Planning Commission, Chairman of the Steering Committee on Vision 20:2020 and immediate past Minister of Finance.

The first Nigerian Minister to publicly declare his assets before assuming office as a public officer, Dr. Usman, in this interview explains why people get public service appointments and appear to have lost capacity to deliver, and the possible benefits from the removal of subsidy.

Being a minister you should be able to sincerely answer this question: Why do many people who have so much energy and ideas enter into government and simply become something else – they talk differently, see things differently?


Shamsuddeen Usman
Well, I do not know of any. I know of many people who are full of ideas and when they get into government become much more active. For instance, look at the constitution of the present cabinet.

They are people who have the capacity to turn the economy around for greater productivity. There are probably some constraints because sometimes the public service machinery does not move as fast as the private sector does. But that again is the nature of public service. The issues of accountability and democratic system.

For instance, you can not just spend money that is not budgeted for. You can not do things that are illegal. If you want certain things to be done, you have the appropriate legislation to back what you want to do. So, sometimes these things seem like people are slow. They are not slow in any way. To the extent that you are pursuing appropriate legislation, to the extent that you are working, it does not mean you are slow.

I am very optimistic about this country for a number of reasons. For example, I grew up at a time when things worked. When you got admitted into a University on merit. I got admitted into schools by sitting down to write examination. While in the University then people came to interview students for jobs. The trains were running, electricity was not wide spread but it was constant. What made us to get things right in those days were leadership and commitments. I am optimistic because it has been done by other countries. Countries have been transformed within 10 to 20 years, but with efforts, strategic planning, commitments, leadership and implementation.

Is vision 20:2020 realisable considering the high level of poverty and unemployment in the economy?

Vision 20:2020 blueprint is a perspective plan target set by the government to guide in its macro economic policies aimed at achieving rapid economic development. It is important for a country to set ambitious target for its economy. More importantly, some people misunderstand the concept of the Vision.

The blueprint of the Vision answers the question on what policies, programmes, projects and actions that the three tiers of government, the private sector and individual Nigerians can do to reposition the economy for optimum production. The Vision anchors on specific targets such as, by 2020, GDP of not less than $900billion. People, per capita income of not less than $4,000 per annum, growth aimed at improving the quality of life of the citizens, the people fundamental reason for growth and achieving inclusiveness, equity and balanced development in the economy.

This talk of double digit growth, which way for Nigeria?

When we did the calculations and projections in 2009, clearly we needed a double digit growth of about 13.5 per cent but that was an average over a 12 year period at the time. Obviously the projection that time was that the top 20 economies were also going to continue growing at the pace that they were growing at that time.

But with the global economic crisis, many of them are not growing as fast as expected and many of them are growing negatively. But we are moving faster and if we continue with this pace and higher, the prospect of being among the top 20 economies will become much easier.

We are working now on calculating the figures. So, it does not actually require double digit growth rate. Mathematically, if an economy is growing at seven per cent and above, it means it is going to double the size of the economy.

Assuming by 2020, we double the size of the economy, that is still a remarkable achievement. I believe we can do even better. There are many sectors of the economy with enormous potentials to be harnessed. For instance, the telecom sector is growing at the rate of 35 per cent per annum. The agricultural sector which was between eight and nine per cent is going close to 10 per cent with little that is being done.

So, with agricultural revolution that the Minister is now talking about, clearly, this is a sector that will soon move into double digit. One problem with our growth is that it has not impacted very much on employment and majority of the people. Unfortunately the poverty rate is still high in Nigeria and that is what Mr. President is trying to tackle with the transformation agenda.

Why is the economy growing at eight percent without creating jobs, it would be difficult to explain this to the average Nigerian or does it mean Nigeria is experiencing a jobless growth?

There are certain types of growth that are not jobs creating, depending on which sectors are growing. The oil industry for example is not a big employer, though it is a big contributor to revenue, foreign exchange and Gross Domestic Product (GDP). That is why the focus of government is to identify those sectors with greater potentials for employment generation such as agriculture, transportation sector, Small and Medium Enterprises (SMEs) with improved power supply, roads and other public goods. These are sectors that will create large number of jobs and people will feel the impact of the growth.

Do we still need the Medium Term Expenditure Framework (MTEF) since we are back to planning, it seems implementing both the MTEF and Perspective Plan blueprint already in place may bring conflict in the fiscal policy framework?

There will be no conflict in fiscal policy.

The reason is that medium term fiscal strategy focuses more on the fiscal side and is also a legal requirement. Under the Fiscal Responsibility Act, the Minister of Finance is required to place before the National Assembly the medium term document. The planning aspect goes beyond the fiscal strategy. For example, we are also looking at the monetary framework. The Central Bank of Nigeria (CBN) is leading an effort to the whole financial sector to what is called financial sector strategy 2020.

Before Mr. President was re-elected, he started the transformation agenda by setting up a team, which I chaired, to work on producing a set of key policies, programmes and projects that he would implement when re-elected. That is what we are calling the transformation agenda.

Nigeria’s economy experienced structural lag due to delay in the approval of the budget, is 2012 appropriation bill going to be different?

I believe 2012 budget will be approved on time because there have been a lot of consultations between the executive and the legislature. To address the key element for example, the fiscal strategy document, there was a meeting between the President and the economic team as well as the leadership of National Assembly, on the key features of the document. There was another meeting between the President and the Senate during which other issues were discussed, in particular, the petroleum subsidy.



Most people believe that if government increases fuel price from N65 per litre to N149 per pump price, the quantum jump in price will cause structural inflation in economy and the multiplier effect will spread to other sectors. What’s your take?

The market has it own discipline. There will be some immediate reactions.

Just immediate reactions?

But if you increase your prices beyond a certain limit, there is tendency to lose customers.

In an economy where the one is contingent on another? Where are the options? In some instances there would be no option?

It is important to realise that diesel has been deregulated already. We are just talking about Premium Motor Spirit (PMS) commonly known as fuel. What is the major element of transport in Nigeria? The Lorries carrying goods from Lagos to other parts of the country are using diesel and diesel is selling at a commercial rate.

Clearly, the effect will only be temporary because the market forces will regulate the prices in the long-run. Look at the telecom sector for example, initially the unit price was very high, while phones were also expensive. The lines were very expensive as well.

So, with the competition and coming in of other service providers, prices began to decline. It will be similar to fuel subsidy. Right now the subsidy is not going to the right pockets and everyone knows that.

The masses using public transport are still paying actually the correct prices. Many people got licenses to build refineries and should be encouraged to go a head. Some people are asking why government’s refineries are not working, forgetting that government has carried out Turn Around Maintenance (TAM)) on the four refineries generally with nothing tangible to show for it.

But whose fault is that? Why are the four refineries inactive?

The reason is that some agencies run by government seem to be inefficient.

That was why I asked earlier whose fault it is?

For example, NITEL is almost dead, but Nigerians are getting along with Global System Mobile Communications (GSM).

But that is not ideal?

We still need land-lines yes; but Nigerians can get along without land-lines. The reality is that we need private sector efficiency to get new refineries built in order to stop excessive importation of petroleum products that is not helping us and the economy in any way. After a short while, the benefits of subsidy removal will begin to manifest to every Nigerian.

Some years ago, the government declared certain goods to be essential commodities. For example, rice, salt and sugar. People formed queues at co-operative shops because there were import licenses for those goods. People were not allowed to import without licenses. Who were those making the money? People who got those pieces of papers called import licenses. They made so much money but an average Nigerian still bought his rice, salt and sugar very expensive at the market prices.

Today, nobody cares because when you need these goods you simply go to the market and buy them. That is what fuel will become one day. We will be laughing at ourselves one day.

Back to unemployment. The rate of unemployment officially stands at over 21.9 per cent, what are the economic implications of an increasing rate of unemployment in a developing economy like Nigeria’s?

The rate of unemployment is high, which ever figure you use like 21.9. The National Bureau of Statistics (NBS) recently put the figures slightly upward to 23.9 per cent. The point NBS made is that unemployment is much higher among the youths between the ages of 15 and 35. So, government is working towards empowering them with small and medium scale loans so that they can actually work for themselves. Especially those who are already running businesses and have ideas on how to expand those businesses to become big employers of labour.

But at present, banks are not giving loans to operators of SMEs; and the few banks willing to assist give very stringent conditions, what is government going to do about this?

Some banks can give very good account of themselves in terms of facilities that had been given to entrepreneurs. They may not be giving as much as needed.

That is why the President is looking at other schemes that will assist this group of young people and as much as possible no stringent condition is required. Clearly, that is not to say that we have an arrangement whereby everyone walks in and takes his own share of the national cake.

Everyone must show evidence of some business organisations, records of previous business transactions and credible business plans to show seriousness in the exercise. It is actually targeted at people who will become entrepreneurs and employers of labour to solve the unemployment problem in the economy not only for themselves but for other people.

http://www.vanguardngr.com/2011/12/subsidy-what-nigerians-stand-to-gain-by-shamsuddeen-usman/

this idiot must go home and address boko haram issues before addressing nigerians and fuel subsidy.
i wish boko haram kills him before the removal of fuel subsidy.