Encarta dictionary defines an asset as something or someone useful; of value.
After the NBS released its figures for the 3rd quarter of the year, it was revealed that Nigeria is officially in recession as it recorded negative growth in its GDP for two consecutive quarters (2nd and 3rd quarters). Ever since then, the Nigerian government has been devising means of stimulating the economy and bringing the country out of the recession. One of these solutions which has been generating a lot of controversy in the country has been the sale of national assets of which the most prominent proponents are Africa’s richest man, Alhaji Aliko Dangote and the senate president, Dr. Abubakar bukola saraki and the Federal Executive Council.
Since then, there has now been indications that the government will consider selling some of its national assets to raise money to get the country out of recession. The two major talking points here are for the government to sell its stake in the Nigerian Liquified and Natural Gas (NLNG) and the NNPC which are the primary non-tax revenue generating assets for the country. The begging question now is this: sales of National assets: a brilliant move or economic sabotage?
This scenario can be likened to a salary earner. Let’s say his salary dropped by more than 50% or less. And he has to feed, clothe and protect his family. Prices are rising but his income is low. Now he has 3 feasible options:
1) To start collecting food on credit and be paying in installments.
2) To apply for loan or overdraft.
3) To sell his appliances, and other things he considers as asset.
The question now goes to you as the salary earner, what will you do in this case in order to preserve the future of your kids and also maintain your level of living.
In my own opinion, the only situation you can sell your assets is when you are bankrupt (a situation of being legally declared or recognized as not being in a position to pay debts). At least, creditors are willing to give loans with low interests based on the credit worthiness of the country. Now consider a case where you do not have such credit worthiness again as a result of the decision which is about to be made. For God’s sake, these are the Nations pride!
This even keeps me wondering:
1) What happened to the $6 billion loan and currency swap deal with China?
2) What happened to the plan to raise $1billion on the Eurobond market?
3) What about the money generated so far from the fight against corruption.
And even recently the AFDB pledged about $4.1 billion loan offer for the stimulation of the Nigerian economy.
Or are they just propaganda in which the sale of national assets is chief? The government hopes to generate about $15billion from the sales. And personally, I think if we can hold on to the measures and agreements above (the loan agreement, AFDB pledge, eurobond, etc), the country can be able to generate up to $14billion from them and will be enough to stimulate the economy than just to sell those assets.
Yet, all they could think of now is to sell the Nations pride? Even if they want to embark on the sale, they can start from the sales of those assets that are more of a liability than asset to the country and not the ones that are sure and capable of generating revenue for the country year in year out.
Currently, Nigeria has about 10 presidential jets. We should not quickly forget the promise made by the present administration concerning those presidential jets. Their cost of maintenance is enough burden for us to bear. Why not start from there or from the enormous income received by the legislators every year, instead of deciding on selling those productive assets that generates revenue to the Nation.
So for me, the sales of the productive National assets is a ‘no go area’ as well as an economic sabotage!
KURANGA ABDULAZEEZ is a 400level economics student of the University of Ilorin. He is a young Nigerian passionate about the harmonization of economics and politics in Nigeria and Africa at large. He is writer on economic issues and a member of campus Leo club igniting the minds of the people through reorientation of values and leadership training.
Sales of National assets: brilliant move or economic sabotage?
ADEDAMOLA H. ADEPOJU
I wouldn’t support such because it will make the country less viable at the long run.
Also a country like Nigeria in this present state can’t manage the proceeds properly and will start to battle with misappropriation and mismanagement of public funds.
Sales of national asset can be seen as a right move not a brilliant one if only the proceeds can be kept in the national treasury for a while till we get our footing right on the way forward to curb corruption which in turn does not make the step an urgent one.
For now the government should give account on the looted funds recovered and it should be used to combat immediate crises and forget about selling the national asset.
Adedamola is a graduate of Obafemi Awolowo University from the department of Local government Admistration. He is a serial entrepreneur and makeup artist.
Sales of National assets: brilliant move or economic sabotage?
Victor Olabode Ayelabola
The President of the Senate Mr. Bukola Saraki, Mr. Aliko Dangote, a successful business man and CBN governor Mr. Godwin Emefiele are the main agitators of this desperate move.
The benefits they say, would be guaranteed paybacks, selling off some of the loss making assets will increase capital short term, calm investors, discourage currency speculation and stabilize the economy.
On the other hand trade unions say that the move is meant to only benefit just a few private investors, in whose hands the economy will be like clay.
Ultimately, there needs to be a drastic solution. What the trade unions are saying is true but we should remember it’s just a short term solution to get out of the deep and provision has been made for the possibility to buy these assets back of which only up to 5% is what is on offer.
In my opinion, the pros outweigh the cons, this is a brilliant and timely move.
Victor Olabode Ayelabola is a member of the Architectural UV Association of Kenya and graduate of Landscape Architecture from the Jomo Kenyatta University of Agriculture and Technology. He has the International Federation of Landscape Architects awards both in 2011 and 2013.