QUESTION : What is your perspective on the Nigerian economy? Olisa Agbakoba: It is an obvious question that the Nigerian economy is in depression. There is an argument whether it is depression or recession. But we have had two consecutive economic slowdowns. We had slowdown in the 4th quarter of 2014, and 2nd quarter of 2016 has seen the second contraction. That is a recession. Which means that if you sell 100 mangoes, you now sell 80 and 60, your business is dropping. If you sell nothing at all, that is a contraction. A slowdown is different from a contraction. Two contractions is depression. So the forecast by the National Bureau of Statistics is that the 2nd quarter of 2016 will see a second contraction. So the economy is in a depressed state. I think what is needed is for President Muhammadu Buhari to quickly articulate his economic plans. I think he started off by being highly statist. He felt that state control was the underpinning philosophy of the economy. But I can see tension in the team which is why the Minister of State for Petroleum, Ibe Kachikwu, made statements suggesting that we are liberalising the market. But you don’t liberalise the petroleum market when you fix a price; the same thing with flexible foreign exchange. Initially, the president was adamant. In a way, I agree with him because how do you devalue a currency when you produce nothing. So emotionally, I agree with him, but economically, we were strangulating the economy, investors were leaving. There are two kinds of investors: foreign direct investment, which puts factories on the ground, were not coming; then the hot money- portfolio investments, were all running. So everything was in decline. So it is not surprising that we have got a hybrid economic policy which permits state control and some kind of liberalisation. We now need to see an economic team. There is no chief economic adviser. The council on economy that the vice president chairs is too large. So we need to see a more compact council of economic advisers that will assist in shaping policies. QST: What is the role of the Nigerian lawyer in the economy? Agbakoba: The role of the Nigerian lawyer is to use the tool called development law. Development law is the application of law to economic analysis. So if you are thinking of releasing money from the real estate sector it’s huge. The estate sector, when you value the entire houses in Nigeria, is worth $7 trillion. Unfortunately, it is not trading. It is dead capital. So how can we unlock the capital in the real estate sector? That is our work. What we do to unlock it is to have a strong mortgage system. To create a legal framework for strong mortgage system in which if you wanted a loan, you can’t carry your house to the bank, you take your documents. But if your documents are in tatters, some of the registries in Nigeria are 100 years old, were not fungible. You need legal fungibility. Just for me to shock you. I am 40 years at the bar, I have never got a mortgage in Nigeria. But I have got six mortgages in the UK. How can that be? The rule is if you have a job, you have a house. Can you imagine if everybody that has a job, the real estate sector will boom. That is just one sector. You turn to the maritime sector, there are 34 derivatives. All people know about is crude. But crude has in my own area, four by-products: law, banking, shipping and insurance. It is all controlled by foreigners. We need to also have a local content policy. QST: What are the solutions to the economic situation? Agbakoba: This is a country that produces nothing but imports everything. So we need a very strong import substitution policy. This means we stop importing and create the work here. Now all of this means you need very strong lawyers in designing the legal processes. Now the PIB, the oil is in the ground but as a result of weak legal and institutional framework we are getting nothing from it. So law wets business to create a sound economy. QST: What about the Cabotage Law? Agbakoba: It was passed in order to enrich the Nigerian economy. But as a result of lack of clear thinking on the part of government, we have ten thousand foreign vessels on our waters excluding Nigerians. So when the president talks about job creation, we ask where it is going to come from. I am not suggesting that we shouldn’t have foreign participation. But you mustn’t crowd out Nigerians. What is the war going on in Britain’s EU referendum between the ‘Leave’ and ‘Remain’? It is all about people saying we are tired of Europeans. So if they can say it why can’t we say it? QST: What is your take on calls for restructuring the country to a true federalism? Agbakoba: That is the underlying nugget. When you and your wife are always fighting, if you like have billions, you both won’t be happy, nobody will make progress. So with all the war in the Niger Delta, the Biafra issue, Book Haram, herdsmen, the president should be asking what’s going on? What is going on is clear. We have not been able to agree on how we want to live among ourselves. We have to answer the question ‘do we actually want to be in one country?’ I think we all agree we want to be in one country. Next question is ‘exactly how?’ It reminds me of the polygamist who has five wives in one house. So wife number one wants egusi, number two wants miyan kuka, wife three wants afang, so there is a clash. So the solution is to restructure my house and move you out to your own house and say ‘you live in this house, have your space and I give you your own money.’ Peace reigns. When all these nuggets are determined, we have to determine clarity to the highest, ‘where are we headed?’ we need to give Nigerians participation, determine the correct value of the naira, create import-substitution, revitalise the housing market, make sure that the maritime sector is working, build peace and stability. If we pull all these together, I predict that by the first quarter of 2017 we will be out of recession. Source:dailytrust]]>