Nigerian President Muhammadu Buhari took office a month ago on a
wave of hope that he would quickly deal with a deepening economic crisis and an
Islamist insurgency in the north. So far, he hasn't met those expectations.
While Africa’s biggest
oil producer has been hit by a 40 percent fall in petroleum prices in the past
year that has slowed economic growth and weakened the currency, Buhari, 72, has
delayed naming a cabinet until September. As the momentum of being the first
opposition candidate to win power at the ballot box fades, critics are mocking
him as a sluggish elderly man, or “Baba Go Slow.”
Buhari has acknowledged
the crisis, saying last month that his government is facing severe financial
strain, with a Treasury that’s “virtually empty,” and his party is calling for
patience. Yet his lack of urgency in tackling economic woes could leave Nigeria
badly adrift, said John Ashbourne, an economist at Capital Economics in London.
“Every week that Nigeria
goes without a cabinet increases the chance that it will face a dangerous shock
-- whether a revenue collapse or a currency crisis,” Ashbourne said by phone
Tuesday. “Leaving the federation without a finance minister would be a
questionable choice at the best of times; doing so during a period of economic
instability is difficult to explain.”
Investor Displeasure
Nigeria’s currency, twice
devalued in the past year in an attempt to cope with lower oil income, has
weakened 7.7 percent against the dollar this year on the interbank market. The
International Monetary Fund estimates that growth will slow to 4.8 percent this
year from 6.1 percent in 2014. The naira was trading at 198.85 against the U.S.
dollar at 2.38 p.m. in Lagos.
The Nigerian Stock
Exchange Index hit its 2015 peak of 35,728.12 on April 2, the day after Buhari
was declared the election winner. Since then it has fallen 8 percent.
The cabinet delay won’t
please investors, said Alan Cameron, an economist at Exotix Partners LLP.
They’re expecting tighter fiscal policy, a currency devaluation and a greater
focus on tax collection after the drop in oil prices, he said.
“There was initially some
hope that Buhari would be able to tackle these changes more quickly and with
more credibility, but the time line has now been pushed back,” Cameron said by
phone from London. “It’s going to be a difficult pill to swallow for foreign
investors.”
Inertia Concern
The central bank has
banned importers from using the foreign-exchange market to buy certain goods as
it seeks to stabilize the naira and hold on to external reserves, which are
down 16 percent this year to $29 billion.
“Even what little could
have been achieved so far, such as the nomination of ministers, has not been
addressed, and there is a sense of inertia,” Folarin Gbadebo-Smith, managing
director of the Center for Public Policy Alternatives, a Lagos-based research
group, said by phone Wednesday.
Buhari’s own party, the
All Progressives Congress, has recognized the growing public disenchantment and
pleaded for patience.
“Nigerians are right to
demand even a faster pace. Nigerians are right to ask that a government be
quickly put in place,” party spokesman Lai Mohammed told reporters at a June 30
press conference in Lagos, the commercial capital. “All we ask for is a little
more patience, a little more understanding.”
Government Change
Buhari is facing a unique
situation because his victory over the incumbent, Goodluck Jonathan, ended 16
years of rule by the Peoples Democratic Party, his spokesman Femi Adesina said.
“This is not a normal
changeover, it is from one government to another,” he said.
Buhari, who previously
governed Nigeria as military ruler in the 1980s, has moved more quickly in the
fight against the Islamist militant group, Boko Haram, which has waged a violent
six-year campaign in the north.
He ordered the army to
move its headquarters from Abuja, the capital, to the northeastern city of
Maiduguri, the scene of some of the worst fighting, and has traveled to
neighboring countries such as Chad and Niger to discuss cross-border military
cooperation.
It’s the “one area in
which the Buhari administration has hit the ground running,” Mohammed said.
Yet, while troops from
Nigeria and Chad have largely dislodged Boko Haram from its self-declared
caliphate in the northeast this year, the insurgents have stepped up
hit-and-run attacks.
Corruption Fight
Buhari will also have to
deal with shortcomings in his own army, which Amnesty International said last
month should be investigated for war crimes, including unlawful killings.
In a step toward meeting
his campaign promise to attack corruption that has crippled Nigeria for
decades, Buhari disbanded the board of the state-run Nigerian National
Petroleum Corp. The National Economic Council on Monday set up a four-member
panel to probe its accounts.
Even some opposition
lawmakers say Buhari needs more time.
“His approach may be
different, but I am patient, I will give him some time,” Ben Murray-Bruce, a
PDP senator, said in a June 29 interview in Abuja.
Where Buhari has come up
short is communicating a sense of engagement to the public, said Gbadebo-Smith.
“He doesn’t say anything
about anything,” he said. “The public would be satisfied with signals that say
we are doing something about this, we are on top of this.”
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