The average oil price in 1999 when President Olusegun Obasanjo returned as Nigeria’s civilian president was $17.80 per barrel. Our official foreign reserves that year amounted to just $5.4bn. GDP size was $50.48bn which at then exchange rate of N92.69/$ was only N4.6trillion. Throughout Obasanjo’s first term, the highest oil price was $26.10 in 2000, with slight declines to $24.50 and $25.40 in 2001 and 2002. In spite of relatively low oil prices, Obasanjo grew FX reserves to over $10bn in 2001 before falling to around $7.5bn in 2002 and 2003. The exchange rate depreciated by 30% by 2002 falling to N120.97. On the policy front, the main economic achievement of Obasanjo’s first term was telecommunications sector deregulation which transformed Nigeria’s telephony and later internet/data sectors. No rational person will deny Obasanjo the credit for the over 150million active lines in Nigeria today. He also established the EFCC and ICPC. Obasanjo’s main political achievements in his first term were stabilizing our democracy and re-establishing Nigeria in the global community.

Obasanjo recorded more significant economic achievements in his second term, enabled by the arrival of Ngozi Okonjo-Iweala, Charles Soludo, Fola Adeola and others into economic positions. The most important milestones were pension reforms, banking consolidation and the revolutionary Paris Club Debt Write-off. Okonjo-Iweala introduced the oil price rule that enabled the accumulation of “excess crude” savings in addition to our foreign reserves. The “Excess Crude Account” (ECA) starting from nil in 2003 was $24.36bn by December 2006 while foreign reserves were over $42billion totaling over $66billion of sovereign savings. In 2003 average oil prices were still below $30 per barrel and GDP size was only $76.64! It was only in 2006 and 2007 that oil crossed $60 per barrel. The effect of Obasanjo’s reform cabinet on FDI manifested for the first time in 2005 (not surprisingly AFTER (!) the Paris Club Debt Write-off as foreign investment jumped to $5.1bn and $7.7bn in 2005 and 2006 respectively.

Obasanjo’s policy failures were the neglect of the social sector as poverty and unemployment began to rise, and crony capitalism began to entrench its roots. Boko Haram and “Political Sharia” were also birthed under Obasanjo and the public sector began to expand in that era. The signal failure of Obasanjo was not to transform the power sector in eight years; but the irony (and redemption perhaps) was that he laid the foundations for reform through enactment of the Electric Power Sector Reform Act. On the political side, Obasanjo diminished the quality of our democracy with scandalous elections in 2003 and 2007, and his third term bid.

Late President Umaru Yar’adua was in office from 2007 to 2010. His reign was dogged by poor health and eventually cut short by his demise. He also had an economic challenge in the global financial crisis and great recession of 2008-2009. Yet average oil prices ranged between $60-100 per barrel during Yar’adua’s time in power, higher than under Obasanjo. Yar’adua drew down significantly on both the ECA and foreign reserves falling to $6.5bn and $42.3bn by 2009 (having risen to $20bn and $53bn respectively by 2008 a legacy of the Obasanjo cabinet). This depletion of reserves was part-justified as a result of the decline in oil prices during the global recession and part-unjustified because the Yar’adua government wasted substantial time reversing pro-market initiatives of his predecessor and stalling the power sector reforms in favour of an unrealistic $85billion government spending programme pushed by Rilwanu Lukman. Under Yar’adua and as a result of the global recession-induced oil price decline, the Naira was devalued from around N120/$ to about N150/$.

Yar’adua’s most important achievement was the Niger-Delta amnesty which restored oil production after the regime’s attempt to deploy military force failed.

President Goodluck Jonathan enjoyed the bounty of high oil prices ranging from about $80 in 2010 to over $100 per barrel between 2011 and 2014, when oil prices fell again. He initially built-up foreign reserves from $32bn in 2010 to over $43.8bn by 2012 before it began to decline to approximately $30bn by the time he left office in 2015. The ECA also fell to $2bn. As president, Jonathan bore ultimate responsibility for the non-accumulation of reserves during a period of high oil prices, but he can plead some extenuation-first he indeed tried to do so, in fact setting up a sovereign wealth fund to institutionalise same instead of Obasanjo’s illegal ECA, but governors stalled the process in court; the CBN refused to countenance even minor adjustments in currency value as imported consumption (and export of capital by corrupt officials rose); governors (again!) insisted on sharing the illegal excess crude account and persistently used it as political blackmail against the hapless president; and Jonathan and Okonjo-Iweala (who had returned as finance minister in 2011 under less-auspicious circumstances as I presciently warned back then) can argue correctly that they also tried to force savings through conservative budget oil price benchmarks, which the National Assembly consistently raised. Jonathan also bears, more directly, liability for the escalation in corruption, which will also have contributed to decrease in reserves. The biggest embarrassment to Jonathan was seeing fuel subsidies rise from an average of N1trillion to over N2trillion in 2011. In this case as well he tried to fix the problem once and for all through deregulating the downstream in January 2012 but political opponents opposed deregulation, which we have now been forced to adopt under worse economic circumstances.

Nevertheless Jonathan’s policy achievements were important-the establishment of the Nigerian Sovereign Investment Authority (NSIA); the revival and substantial completion of the power sector reforms; successful reforms in agriculture and trade; GDP rebasing and growth resulting in Nigeria becoming the largest economy in Africa at $510bn; and the exponential increase in FDI crossing $20bn in 2013 and 2014! Politically Jonathan enacted the Freedom of Information Act and ensured free and fair elections including the one that saw to his displacement in 2015! His main failing was his weak leadership which manifested in a festering Boko Haram insurrection and large scale corruption in his government.

By 2015, Obasanjo, Yar’adua and Jonathan all bore varying levels of responsibility for worsening poverty and unemployment as policy pandered to crony capitalists at the expense of the mass, even though Jonathan made modest efforts through Almajiri schools, “You-Win” and SURE-P programmes and investments in the education sector. The cost of governance also escalated with both the executive and legislature to blame.

http://opeyemiagbaje.zone/index.php/2016/08/24/nigerian-economy-since-1999-myths-lies-and-data/

lalasticlala

We need to start thinking "solutions"

I love that last paragraph. People tend to forget that the cost of governance and corruption rose exponentially.

Wow so Yaradua was this cute. Ndi Hausa eh

Nigeria fought a civil war without borrowing from 1967-70 when oil was $2 a barrel and there was no recession but in 1983 when oil price collapsed from $40 to $8 our economy was in austerity and recession even without a civil war to finance. That gives an idea of what's happening today

hahn:
We need to start thinking "solutions"

thinking or doing. Solutions boku. Na laziness de worry una

Ovamboland:
Nigeria fought a civil war without borrowing from 1967-70 when oil was $2 a barrel and there was no recession but in 1983 when oil price collapsed from $40 to $8 our economy was in austerity and recession even without a civil war to finance. That gives an idea of what's happening today

Why would they have borrowed when war mongers and greedy foreign capitalists were falling over themselves to supply weapons, financial, technical and tactical support in order to protect their pecuniary n selfish interests thereby retaining this unholy alliance we labour under today? You can see they aren't quite willing to bother with Nigeria these days other than to keep leeching.

mikolo80:
thinking or doing. Solutions boku. Na laziness de worry una

Who be una?

kenny987:


Why would they have borrowed when war mongers and greedy foreign capitalists were falling over themselves to supply weapons, financial, technical and tactical support in order to protect their pecuniary n selfish interests thereby retaining this unholy alliance we labour under today? You can see they aren't quite willing to bother with Nigeria these days other than to keep leeching.

That's not what the narrative is about, don't let prejudice eat you up

IN

The aspect of social welfare is not complete.

Obasanjo raised the minimum wage to N7,500 while Jonathan raised same to N18,000. These were responsible for the growth of the 'middle-class' significantly, while the poverty index arguably reduced.

To underscore this, the average teacher even in rural areas started buying cars 'tokunbo' by early 2001, while significant numbers of salaried workers, artisans and blue collar workers constructed their own houses between 2006-2014.

The period also witnessed massive investments in children's education by households; in private schools across the country and abroad.

What is more? The opening up of university education to private sector participation not only resulted in competition, but also increased access to candidates who would have been denied opportunity of higher education pre-1999.

We also witnessed the growth of SMEs. A direct result of business friendly reforms. Red tapes slowing down business registration were cut, as bottlenecks impeding business such as multiple taxation, business dispute/legal administration were fixed.

Life expectancy rose significantly as well. The activities of fake drug manufacturers, which largely accounted for untimely deaths in the country were tackled by NAFDAC's 'scientific' and systematic regulations. Other regulatory institutions were allowed to function similarly.

The secret behind the modest achievements of Obasanjo, Yaradua and Jonathan is that they did not use the performance of the former government as excuse for failure.
Though these men has their faults and weaknesses, they were able to stabilize Nigeria economy throughout their tenors. At least I know that Nigerians did not suffer under OBJ regime despite the fact that OBJ inherited worst situation than what PMB is claiming to inherit. If OBJ can perform when oil was less than $30 per barrel throughout most of his tenor, PMB should not complain as oil is still above $45 per barrel.

egbonnla:
The secret behind the modest achievements of Obasanjo, Yaradua and Jonathan is that they did not use the performance of the former government as excuse for failure.
Though these men has their faults and weaknesses, they were able to stabilize Nigeria economy throughout their tenors. At least I know that Nigerians did not suffer under OBJ regime despite the fact that OBJ inherited worst situation than what PMB is claiming to inherit. If OBJ can perform when oil was less than $30 per barrel throughout most of his tenor, PMB should not complain as oil is still above $45 per barrel.

You can't compare economy situation in 1999 to 2015
You can't compare cost of governance In 1999 to 2015,
You can't compare nigeria's populations from 1999 to 2015
You can't compare insecurity in nigeria 1999 to 2015
You can't compare standard Of living in 1999 to 2015
I Can go on and on.


When all these re increasing annualy, a sane govt must save and have a robust foreign reserve to complement all these.
if nigeria's economy,and savings cannot complement the above mentioned it will result to disaster.meanwhile it is happening already.

You can't be earning 50k when single and expect it sustain you when u get married, and give birth, you need to increase your income and save to meet all those challenges unless the next neighbour will be yanshing ur wife with peanuts.

hahn:


Who be una?

you, me, we Nigerians

egbonnla:
The secret behind the modest achievements of Obasanjo, Yaradua and Jonathan is that they did not use the performance of the former government as excuse for failure.
Though these men has their faults and weaknesses, they were able to stabilize Nigeria economy throughout their tenors. At least I know that Nigerians did not suffer under OBJ regime despite the fact that OBJ inherited worst situation than what PMB is claiming to inherit. If OBJ can perform when oil was less than $30 per barrel throughout most of his tenor, PMB should not complain as oil is still above $45 per barrel.

The economy is not just a function of oil price.
Have you considered the fact that production has drastically reduced?

Clonus:

The economy is not just a function of oil price.
Have you considered the fact that production has drastically reduced?

Check your facts. Production under OBJ was not up to what we have today under PMB. I also voted for PMB but we should not blindly support his obvious incompetency when it comes to matter of economy.

Trashy

The secret behind the modest achievements of Obasanjo, Yaradua and Jonathan is that they did not use the performance of the former government as excuse for failure.
Though these men has their faults and weaknesses, they were able to stabilize Nigeria economy throughout their tenors. At least I know that Nigerians did not suffer under OBJ regime despite the fact that OBJ inherited worst situation than what PMB is claiming to inherit. If OBJ can perform when oil was less than $30 per barrel throughout most of his tenor, PMB should not complain as oil is still above $45 per barrel.

Thank you.
Don't mind someone who thinks that ruling Nigeria is his birthright, but is completely bankrupt of ideas and vision about what it takes to rule a multi-ethnic, multicultural, and complex country like Nigeria.

OkoNDOoBo:


You can't compare economy situation in 1999 to 2015
You can't compare cost of governance In 1999 to 2015,
You can't compare nigeria's populations from 1999 to 2015
You can't compare insecurity in nigeria 1999 to 2015
You can't compare standard Of living in 1999 to 2015
I Can go on and on.


When all these re increasing annualy, a sane govt must save and have a robust foreign reserve to complement all these.
if nigeria's economy,and savings cannot complement the above mentioned it will result to disaster.meanwhile it is happening already.

You can't be earning 50k when single and expect it sustain you when u get married, and give birth, you need to increase your income and save to meet all those challenges unless the next neighbour will be yanshing ur wife with peanuts.

I am sorry to say this, but I get tired of the level of economic illiteracy and selective amnesia I see here all the time.

The fuction of government is actually to SPEND money to provide social services for the welfare of the people, NOT, I repeat, NOT to save money for the people.

Everyone keeps shouting ignorantly that Jonathan didn't save money for the rainy day, etc.
Bullshyte !
The more money government takes in, the more it spends for the provision of social infrastructure and services.
During GEJ era, States and local governments got a lot more money for education, health, security and infrastructures than they did during OBJ and Yaradua era.
During the GEJ era, the governors asked for and even sued federal government for more money.

Now, only someone who doesn't understand the purpose of government and the techniques of governance would be SULKING that a previous government didn't leave so and so amount of money behind for him.

Only ignorant or disingenuous people would say that our economy is tanking because GEJ didn't save enough money.
Save enough money for whom and for what ?

The government spending is the single largest contributor to our GDP
Can you imagine if a government refuses or holds back spending on social services and infrastructures with the excuse that it wants to save money for the incoming administration ?
Would that make sense ?
There is nothing, absolutely nothing wrong with the government spending all the money it gets or even borrows more.

GEJ spend money commensurately with income and national projects.

The issue, the main issue for all sincere patriots, irrespective of party loyalty, should always be how well monies are spent.
That's is the only thing that should matter.

Ironically, this was the Change that most us were sincerely expecting; Drastically cutting down the high cost of governance,at all levels.

This is where Buhari has woefully failed.
So far, it is obvious that he either doesn't get it, he has been insincere all along, or, that he lacks the political will to effect any meaningful change in governance.