By Mike Hunder
For eight consecutive years, the Buhari administration had been spouting the “no money” rhetoric. Added to the puzzle, at a time when Oil-producing countries were reaping sustained windfalls from high oil prices, in above $100 per barrel on average by 2022After the Russia-Ukraine war, the NNPC did not make remittances to the federation account for most of the year.
Now, a series of startling revelations have contradicted the administration’s “no money” statement, with dramatic speed.
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First, the Auditor General, in a 2022 letter to the Senate, revealed that “a total of 17,877,705 barrels of crude oil valued at $1,020,969,281.12 (more than one thousand twenty million dollars), were exported between 2016 and 2020, without the proper records. This may explain the non-remittance of funds by the NNPC to the federal account that characterized the administration.
Second, things got so bad that the then Finance Minister, Ms. Kemi Adeosun, clashed with NNPC for defrauding the government on several occasions. In one case, in June 2018, there was a clash between the National Economic Council and the Nigerian National Petroleum Corporation (NNPC), when the then Finance Minister, Ms. Kemi Adeosun, deliberately accused the NNPC of misleading the government. She Declared the NNPC Account to the Federal Accounting Committee (FAAC) “Unacceptable” and Called for a Full Account of the “Missing Billions”!
What happened there after? The “deep state” clipped her wings, with allegations that she falsified her NYSC certificate. Three months later, he quit and life went on.
Another revelation came out in the full Senate in December 2022. Nearly 100 federal MDAs went unaccounted for to the tune of #1.9 trillion naira between 2017 and 2021, despite several invitations. More shocking, most of the agencies involved report to the presidency. This included the State House, the Presidential Fleet, the Ministry of Finance, the armed forces, the Police, the General Accounting Office, NEMA, the Ministry of Defence, the Special Assistant to the President on Niger Delta Affairs and many others. .
The fourth was a bigger problem than many thought at first. The CBN has embarked on unrestricted “money printing” for the Buhari administration since 2015, in repeated disregard of the laws. Under the CBN Law, the “ways and means” service (a code for printing money for the government) must not exceed 5% of the previous year’s government revenue and must be paid within the financial cycle. then again, article 38 provides that, “the means”… must be reimbursed before the collection of another.” However, the Buhari administration continued to collect CBN “ways and means,” without making a refund, in a zeal never seen before, reaching $23.7 trillion by December 2022.
when the Edo State Governor Godwin Obaseki first revealed the beans about CBN printing money for the federal government in April 2021, the government denied it. Now, realizing that the “ways and means” account cannot be kept from the public beyond May 2023, the president has sent a request to the Senate to give it a second life. Call for legislation to restructure it and pass it back to future generations over a 40-year period! Other than the puzzle, the request contained no records of how, when, and what the $23.7 trillion was spent on.
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Until recently, the administration claimed that Nigeria does not have a debt problem, but an income problem. It then embarked on constant foreign borrowing, increasing foreign debt by 300% between June 2015 ($10 billion) and June 2022 ($40 billion), with no corresponding increase in foreign currency earnings. Now, Patience Oniha, director general of the Debt Management Office, appearing before the House of Representatives to defend the 2023 budget, revealed that Nigeria does have a foreign debt problem. As Moody’s and Fitch downgraded Nigeria to a ‘B’ category economy in 2021, the international market has closed its borrowing doors against Nigeria, making it more difficult for the country to borrow.
On top of this, the huge stock of national debt fell, by seventy-seven trillion naira.
Thus, a horrible spiral has developed: huge sums of money going unaccounted for, constant foreign borrowing with no corresponding increase in foreign earnings, and a gigantic national debt of seventy-seven trillion naira comes full circle!
In the current climate, what puzzles people is, where did all this money go? Many who have defended the administration on financial prudence now say they can get no further than this caricature. Then again, after May 2023, things will likely get worse before they get better. So now comes the hangover!
*Mike Hunder, Lagos-based economist and business training consultant, was CEO of Union Bank Plc and Oceanic International Bank respectively. He can be reached at: hundermike@mikehunder.com
