President Muhammadu Buhari has made no secret of the fact that he is seriously ill. But he has, so far, made secret of the nature of his illness on the basis that there is no need to release detailed information about it.
The President, we are told, is entitled to privacy. This reasoning is fallacious first, given the market sensitivity of the matter, and second, given the fact that he is not a private citizen.
A bland public acknowledgment of Buhari’s illness is not good enough. There is a difference between saying someone has stomach ache and admitting that the person is suffering from gastroenteritis. Markets are able to price-in the latter, but not the former, as it is too vague to have any real meaning. That, I am afraid, is precisely where the President’s health is vis-à-vis the domestic and international markets today.Ambiguity and uncertainty are the anti-thesis of a healthy market. It is therefore worthy of some reflection if only to raise the public’s awareness of its impact on the economy.
The macro-economic environment in this country is a function of two things: the government’s fiscal (tax and spend) policy and monetary (inflation/interest rate) policy. Although the governor of the Central Bank of Nigeria has control over monetary policy, the Federal Executive Council sets the target, as both the inflation and interest rates have direct bearing on politics in the electoral cycle.
The CBN is not really a ‘bank’ in the conventional sense; it is more a manager of banks. It is a bank of last resort in the crucial sense that it regularly steps in to bail out ailing banks with public money. This is a political cum economic responsibility for the governor, who reports to the President not, interestingly, to the minister of finance. When the CBN governor decides to raise interest rates, for instance, this has the effect of moving money away from the capital markets and into a safe (and more lucrative) bank deposit. Once this happens, share prices inevitably go down as money is drained away from companies into the banks.
A hike in interest rates also affects companies as it increases their debts. By the way, most successful businesses fund themselves through borrowing. In a developed economy, the policy of high interest rates attracts foreign money into the banks as well, from investors looking for quick gains. And, it has the medium term effect of strengthening the local currency, which the Nigerian economy badly needs right now. The only rider, though, is that any strengthening of the naira reduces the competitiveness of the country’s industries in that it makes export more expensive.
The above sounds rather dry and even specious, some would say, but it demonstrates the enormity of the power of the CBN governor and the significance of that office to the Presidency. Furthermore, investment decisions are made when there is clarity and continuity of government policy. The President not being well and not taking a medical leave creates a lot of room for ambiguity and uncertainty. It does not create conducive atmosphere for investment decisions.
President Buhari will not be the first to fall sick in office. John Kennedy of the United States did in the 1960s. Also, Leonid Brezhnev of Russia and Francois Mitterand of France, among other world leaders, also fell ill in office at different times in the past. What is peculiar about Nigeria is the level of taboo attached to an illness. This is particularly so because political office is much too personalised in this country.
I heard one governor of a state boasting on TV a while ago, while confronting angry demonstrators: “I am the constituted authority in this state”. What arrogance, how shameful! By way of an analogy, the United States does not have a ‘government’ as such. The US President instead, runs an ‘administration’. Centres of power and governance are diffused and multi-layered based on the constitution.
Institutions of government bureaucracy are equally diverse and independently functional. The Pentagon (defence), State Department (foreign affairs), Homeland (internal affairs), Federal Reserve (central bank), etc, all have a life of their own; their own institutional memories and non-partisan leadership. There is also a broad agreement on the essence of the US economy: It is to promote free enterprises at home and make the rest of the world safe for American capital. Consequently, American government can run without a government as such. The system is designed to run even if a bombastic moron was elected President.
Compared the above with what we have in Nigeria. The CBN governor, not being a member of the cabinet, is supposedly ‘independent’, but he reports directly to the President. And, if he (the President) is not well enough to be attentive, democratic control of the CBN becomes a figment of the President’s imagination. Decisions on fiscal policy is supposedly a collective cabinet responsibility, but who in their right mind, sitting across the cabinet table, would not make it a duty to pay attention to the body language as well as utterances of the President? And when Buhari is absent from the meetings, it complicates matters, even if the Vice President is barking orders to cabinet members from the rooftop.
Political allegiance runs far too deep in this country to overlook the absence of Mr. President on crucial issues of policy. What about the state governors? Only about six out of the 36 states of the federation are currently viable. The majority are dependent on the monthly handouts from the Presidency. The police through the Inspector-General of Police reports directly to the President. What about common roadworks?
Decisions affecting construction and repair of major roads in Aba, Jigawa, Ibadan, Yobe, Badagry, et cetera, are often said to lay in the Presidency because they are ‘federal roads’. Politics in this country is total and so is the conception of power; it is militaristic and it belongs to the President. When the embodiment of that power is nursing a serious illness, it injects paralysis into the economic life of the country. This, I am afraid, is what the Nigerian elite have settled for. It will change only when there is demand for a different arrangement from the bottom up. Till then, ill or not, whether he is receiving treatment in Katsina, Abuja, London or on Planet Zog, Buhari rules. Okay?
Tayo Oke, email@example.com
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