Monday, August 27, 2007

Substance Abuse

Ed’s Note: The Law has not suddenly become an economist, a macro-economist or any other sort of economic or financial pontificator. The Law, under no coercion, threat, other form of intimidation, hereby willingly admits that he knows sweet fuck-all about economic theory. The Law is merely speaking via the instrument of common sense. Which instrument is (according to The Law’s mother in one of her many pearls of wisdom) not that common…

No, no, boys and girls. This is not a treatise on the dangers of weed, cocaine, alcohol, or amphetamines. This is not about “just saying no.” This is not about resisting peer pressure.

Sometimes, men undertake certain actions which can not simply be explained away, actions which require deeper scrutiny as to the motives behind them. General Custer deciding that Little Big Horn was an excellent place to make camp, Hugh Grant deciding to get a blow job in his car, General Abacha forgetting to read the small pamphlet contained in the box of Viagra, Tricky Dick sending his men to the Watergate Hotel, Bill Clinton forgetting that dried, two-week old semen stains still contain DNA, Adolf Hitler looking at Great Britain, half-crippled and just waiting for the Wermacht to come strolling in, and deciding to invade the Soviet Union instead, and so on.

Given a chance to explain, these men, great, powerful, influential, popular, would probably mumble something about pressures of work, the need to relieve tension, and give the public the sad puppy look while pleading for forgiveness (this worked especially well for Hugh Grant, except his babe was not amused). If you probe a little deeper, you might find that there was one shot of whisky too many involved, or an extra hit off a stick of igbo so strong it shouldn’t even be allowed on the market.

Perhaps this explanation will suffice to explain the recent decision of CBN Governor Soludo to “re-denominate” the Naira.

Suddenly, with Baba gone, Soludo found himself in the cold following the ascension of Umoru to power, and this despite his decision to drop “Charlie” and get back to his roots. Chuks, as he now wants to be known, went into seclusion for a while. This was rather unusual for a man who did his best to stay in the media spotlight every other week during the tenure of Baba. Some disrespectful wags said he was merely taking the route of Old Testament prophets, and going into the wilderness for 40 days and 40 nights at the conclusion of which he would emerge emaciated, bushy bearded, and, perhaps, bearing a stone tablet or two containing the cure for Nigeria’s economic woes.

So, when Chuks called a press conference, everyone was curious. People wanted to know if he had indeed returned with a stone tablet, and whether God had managed to learn how to write in Igbo sometime in the past 4,000 years or so. A stone tablet would surely not have been as shocking as what Chuks did have to say. His resignation? No such luck. And no stone tablets either. Rather, Chuks announced that as of August 1, 2008, we would be dropping two zeroes from our currency, scrapping the all notes from 50 Naira and above, issuing new notes, and pegging our dollar exchange rate at N1.25 in the new currency. Over the next few days, persons took to the pages of the papers lauding the new direction of the currency policy, rolling out the drums, ticker tape, confetti, balloons and so on. Chuks’ speech was described as “ground-breaking” (indeed, the collective impact of millions of jaws hitting the floor was felt so strongly across the world that a tsunami warning was issued). He was hailed as the best thing to happen to Nigeria since…since…erm…Obasanjo.

This is the same Chuks who told us to spend hundreds of millions printing 1000 Naira notes which he explained as being necessary for “high volume transactions” (read PDP National Convention). Next, he told us to spend billions of naira printing new 50, 20, 10, and 5 Naira notes and minting new coins. Further hundreds of millions were spent on a nationwide publicity campaign to “sensitize” Nigerians to the new notes. Now, barely a year after, Chuks wants us to scrap the 1000 Naira note, (election don pass, abi?), and apparently print new 20 Naira notes to replace the current ones, as well as new 50 kobo, 1, 5, and 10 Naira notes. Naturally, this will run into further billions of Naira.

Now, re-denomination in and of itself is not a bad idea. If your currency is in the toilet, that is. If prices in your currency make as much sense as base jumping without a parachute. Or if your economy is in the midst of a crippling crisis and inflation has sent prices zooming out towards Alpha Centauri at Warp Seven. Indeed, the examples Chuks gave in his “ground-breaking” speech were all uniformly of countries experiencing one of more of the above.

Argentina was in the midst of a series of economic crises so crippling they tried everything short of contacting a babalawo (and I’m not sure they didn’t do that) when they re-denominated their currency several times between 1970 and 1992.

Germany was feeling the effects of an ill-advised attempt to conquer the world, and groaning under the effects of the Treaty of Versailles when they re-denominated the Mark in 1923. And in 1948, after yet another ill-advised attempt to conquer the world, they re-denominated again. Third time’s the charm, anyone?

Buying a bottle of Coca Cola (I could have said coke) in Ghana cost thousands of cedis, prior to their decision to re-denominate. Need I say more?

His other examples of Bolivia, Mexico, Brazil, Poland, and Uganda (yes, that Uganda) to mention a few, simply aren’t worth puncturing.

Was Chuks, by mentioning these crisis babies, perhaps trying to tell us we would were either experiencing an economic crisis, or would soon be in the middle of one? You’d lean this way if not for the fact that in the same speech, Chuks mentioned the fact that our banking sector was booming, and we would soon have not one, not two, but seven banks with market capitalization exceeding $1 billion. Hardly sounds like an economy in crisis, does it?

He said we would be restoring the Naira to its pre-SAP value by re-denominating. Let’s look at that for a minute. Prior to SAP, in the 80s, the Naira exchanged at close to par with the dollar, and while our economy wasn’t exactly booming like it was in the 60s, it wasn’t dead either. Maradona, in his infinite wisdom, decided to take an IMF loan, but opened the topic to debate by Nigerians. The people told him we didn’t need the IMF and their loans and conditions. Maradona nodded, wisely, announced his intention to abide by the wishes of the overwhelming majority of his countrymen, then took the loan anyway. As part of the IMF’s conditions, he devalued the Naira, and adopted such other economic “measures” as prescribed by the IMF which promptly sent our economy into diarrhea-induced intestinal cramps.

Even so, at the time of the dark-goggled one (of blessed memory), our Naira was exchanging at 85 to a dollar, and stayed that way for a while. When the reform champion, General-who-never-fires-blank, and all-round tough guy, Baba arrived on the scene, the Naira inexplicably nose-dived to 130 to a dollar, and has since hovered between 130 and 127. With the repayment of our foreign debt, and the rising clamor for our Naira to be restored to its pre-Maradona days, Chuks has decided to chop everyone off at the knees. If the Naira-Dollar exchange rate goes to N1.25 in the new regime, it simply means that we are now exchanging our currency at the current rate of N125. The value of the currency would not have improved, and Chuks is banking on the semantics involved to blind everyone to the reality of the situation.

As a friend in the banking sector put it, “If from August 2008, the 500 Naira recharge card goes for 5 Naira, you’ll still have to shed the same blood sweat and tears for the 5 Naira as you currently do for the 500. The value of the currency won’t improve in any way.” This is so true.

The difference between revaluing the currency and re-denominating is therefore stark and bare. If the currency was revalued, the value contained in the Naira would rise accordingly. Re-denominating is having currency of the same value, but without the same name, or as we liked to say back in UNIBEN, I say see neck, you say see throat.

Now that Umoru has “suspended” Chuks’ plans (prior to giving him the boot, it is whispered in some quarters) I hope he doesn’t give in to any flowery explanations or rationalizations, and the plan remains suspended indefinitely.

If Chuks could kindly let us have the number of his weed-man, I'm sure we will then be able to join him on cloud 27, or where ever he was when the crazy idea entered his head.

Thursday, August 16, 2007

Diplomatic Impunity

I have no doubt that every morning, the staff of the British High Commission in Nigeria wake up, peruse their newspapers, and heave huge sighs of relief. Another day has passed, and their offices haven't been bombed, burned down, invaded, etc.

They probably exchange "jolly goods" and any other nonsensical expressions when they arrive at work, and settle down for another day of doing what they perhaps enjoy more than anything else - looking for new and innovative ways to scam Nigerians.

For, make no mistake about it, a massive, massive scam is going on at the British High Commission, perpertrated through their UK Visa Applications Center.

Now, perhaps, we Nigerians are partly to blame, what with our apparent burning desire to visit their country and contribute our quota to its development at the expense of our own, and they can perhaps claim that in the mire of thousands of applications that pour in daily, legitimate persons get the bum's rush. But come the fuck on!

Here's how the scam works - you pay your Visa Application fee, and are given a form to fill. The staff of the UK Visa Applications Center are remarkably helpful in letting you know what documents to submit in support of your application, depending on what type it is. You go off, get the required documents, ranging from Sponsors' Letters to Bank Statements, and submit them in support of your application. Then you settle down for a two-week waiting period (officially). At the end of two weeks, assuming you've done all they asked, they should grant your request, right? You'd be sooooooo wrong.

Over the past year, several people I know have applied for varying visas from the UK VAC. All of them have been denied. Perhaps, you say, all these people have wrongly filled in their information, or failed to provide vital documents, but that isn't so.

My good friend, who is now in the UK and contemplating a Ph.D, was denied a student visa on his first application on the ground that although he'd paid his school fees in full, he was not considered to have sufficient funds to pay for his Masters Programme! Huh? He paid the entire fee, submitted evidence of this fact, and yet was told he didn't have the funds to pay for a Masters programme, which he'd already done. It was only on his second application that the Visa was granted. Naturally, he had to pay another Visa Application Fee, and submitted the exact same documents, before he was granted his Visa.

Another friend was denied a student visa on the grounds that the tax clearance certificate submitted by him in support of his application was "fraudulently obtained". Mind, the tax clearance certificate in question wasn't his personally, but belonged to his father's company. In support of his student visa application, he submitted bank statements from 4 banks, each showing a healthy account balance, and corresponding history of high volume transactions. Apparently, not being able to deny him on financial grounds, they came up with "fraudulently obtained tax clearance certificate". The young man has now obtained a letter from the tax clearance comptroller verifying the certificate, and re-applied, paying another Visa Application fee. They'll probably grant this one.

Yet another person was denied a visiting visa on the grounds that he deposited money into his account "suspiciously close" to the time he paid his Visa Application fee. Naturally, they failed to provide a definition of "suspiciously close". So, while he had evidence of funds to finance his trip, he failed to provide evidence of their origin, and could not therefore be given a Visa. Nice, eh? So, if you were to come into a million naira contract after years of sweating it out, and slogging away, you should wait a few years to apply for a UK Visa, so as to avoid applying "suspiciously close" to when you were finally smiled upon by God for your years of hard work.

And finally, my personal favourite, and one that doesn't simply take the cake, but takes the entire fucking pastry industry. A young lady I know wished to visit the UK on holiday. She happens to hold a respectable job at a big bank, and she's worked there for a number of years. In her case, she was told that while she had submitted print outs showing places of interest to visit in the UK, she had failed to provide a "reason" for her trip, and then, the whopper - she was further informed that while she had shown evidence of financial status vis her ability to pay for her trip, the trip would consume her savings and was therefore not feasible!!! Since when did the UK VAC become a financial advice center? And is it not customary for people to save money for vacations? I've heard people give interviews on TV and say stuff like "I always wanted to visit Australia, so I've been saving up for the trip", or something along those lines. The lady has since decided to take a trip within Nigeria for her vacation, somewhere down south.

Now, when a man who was previously dirt poor becomes a Senator or Honorable, decides to take a trip to the UK and submits personal bank statements in support of his application, you'll never hear questions like "origin of funds?" or any other bull shit. They don't want to know whether he had N20,000 in his account a few days ago, and a sudden deposit of N200 million two days to his Application would not be considered "suspiciously close". Fuck no. The Visa would be granted with immediate alacrity so he can go shopping on Bond Street for fine new suits, and spend some of our hard earned currency in their land. Indeed, they'll probably give him directions to the most expensive shops. For such people the normal rules of rejection do not apply.

I say these people are extremely lucky they do not provide these shabby services to people who have short fuses, and I don't believe they would dare run such an ovbious scam even in Ghana!

But this is Nigeria, no? The land where anything goes, and usually does.

Saturday, August 04, 2007

Dear Chxta,

I know you care a great deal about this fucked up country we call home, and you always have good ideas about what we can do to fix it, but the sad truth of the matter is that things will never improve unless certain persons are sent swimming to the bottom of the ocean. And, sadly, that looks like it ain't never gonna happen.

One prominent businessman, who had his fingers in the attempt to steal Nigeria's refineries, and has over 1000 trailers, would never allow the rail system to work as that would end his business. And, seeing as the said Dangot... *sorry* businessman is heavy into the government, I don't see how he, for one, would allow the improvement of the railway system. Hell, enter Abuja. Their idea of mass transit is to buy hundreds of buses. And they call Abuja a "modern city". I'll bet they always say that tongue in cheek. For, what modern city in the world doesn't have a viable and working inner city rail system? The traffic jams are growing as more and more people pour into Abuja in search of the golden fleece, and the roads are beginning to choke up. I guess the consolation is that every weekend, Abuja becomes a ghost town.

Our Igbo brothers, who have considerable interests in the luxurious bus transport business, vowed never to allow the government construct an airport at Onitsha, and the airport has truly never been built. Never mind that doing so would drastically reduce the number of senseless deaths caused by accidents, armed robberies, etc. on the east-west highway axis. My sole trip to Onitsha to date left a lasting impression on me. It was late evening, and myself, my elder brother and our dad were passing through Onitsha on our way to Port Harcourt. And what did my young and impressionable eyes see? Huge buildings on either side of a road that was no more than a dirt track. A rain-hammered dirt track. The ride through town was a rollercoaster of highs great enough to see glittering jeeps in compounds, and lows deep enough to invoke impressions of Hades. A slalom of lefts and rights, with a bit of freestyle swimming thrown in. If the French hadn't engineered the Peugeot 504 to be the meanest road machine ever built, we'd never have made it out. I wondered how people could live like that and came to the realisation that the jeeps were for the road. So, it was a case of "Nna, if you can't buy ya own jip, go an fix de road." So how, then, could this me-first mentality allow anything that would help others?

Our generator importers have vowed never to allow NEPA/PHCN work as that would end the generator business. In Abuja, the nation's capital, virtually every single traffic warden's box has been donated by a generator company, in demonstration of their prosperity. Naturally, they feel like they're giving back to the community. Never mind that the community would be better off without them. No doubt, closer inspection will show that the people behind these companies are some of the big shots in Naija.

So, therefore, my good man, how the hell is anything in this country supposed to work? How can we fix Nigeria?

Well, we could ask Ghana to borrow us Jerry Rawlings, for starters...

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I love my country, enjoy a cold beer once in a while, rabidly support Arsenal FC, but I don't get Diet Coke...