On Osun: Is Dagunro Really That Different from Tete?

Yoruba people, in song and proverb, like to make much of the difference between tete – an amenable to the palate type of vegetable that’s easy to eat – and dagunro – a coarse type of vegetable that carries thorns on its stems. The warning goes that you shouldn’t be so silly as to eat dagunro the same way you eat tete or you’ll have yourself to blame.

Take it away Ogbeni

In the video, Ogbeni and his supporters are issuing the explicit warning, presumably to the PDP, that dagunro (Osun) should not be eaten the way tete (Ekiti) was eaten. In the end, they were proved right with Ogbeni’s rearguard action to win re-election.

But what can the APC learn from this victory?

The APC’s model of winning elections is clearly unsustainable.

This is why it is losing more than it is winning lately. Consider the facts about Osun:

Nuhu Ribadu defeated GEJ there by 60-40 in the 2011 Presidential election. The APC (then ACN) swept all the State House of Assembly, Senate and House of Reps seats in the same general elections of 2011. If you know a fiercer campaigner in Nigeria today than Rauf Aregbesola, please point them out to me. As much as he may have had some misguided policies in his 4 years in office, he definitely got many things right. Osun state is almost certainly the APC’s strongest state in Nigeria. A friend who was part of a ‘fact finding delegation’ from Oyo state to one of Ogbeni’s campaigns said they were incredibly inspired just by watching him, especially after he rode on top of a bus for 20 kilometres (I did not see a single photo of him inside a bus during the campaign, he was always on top of it).

All of that went into beating an ex-jailbird who will probably go to his grave with the smell of a high-profile murder never departing from him. I quibble with the votes he racked up in Ife which flattered his final result, but leave that aside – he was beaten 57-43. What if Aregbesola didn’t campaign as hard as he did? It’s a real warning that if any of those perfectly lined ducks had moved, the state could have been lost.


This is still not being used enough. For a party that is seeking to overturn an established order, it really has no choice but to do this. Over at the FTF we did some very simple stuff on the day of the election (more on this later) and the response was quite interesting. Of course if this played any role in the election result, it could not have been more than 0.0001%. The work had already been done by then. Still, there are plenty of low hanging fruits to be plucked. But it cannot be a scatter gun approach.

The battle now moves to Adamawa. I am a Man United fan and I know what it feels like to go through a terribly predictable season punctuated with the occasional false high of beating Arsenal 1-0 at Old Trafford. Enough said.

The Ogbeni Coalition and Party Loyalty

The man seems to be assembling what is clearly some kind of Bourdillon-free coalition that is tested and trusted to deliver elections if only in Osun state. But then everyone needs a strong base from which to launch a bigger ambition. He convinced Serubawon (Isiaka Adeleke) – which turned out to be a very good move and ‘Prince of Peace’ (Olagunsoye Oyinlola) – which turned out to be a waste of time – to join him from the PDP. I doubt these people came over because of Bourdillon but it will be a test of his own clout to see how he manages these very inflated egos.

Staying with defections and as an aside – do we overrate defections in our democracy at the expense of loyalty? There are plenty of people in the PDP and APC who have remained loyal inside the party even after not getting what they want. There are many who will never defect to another party no matter. Yet, people who cross carpet dominate discussions about our ‘nascent’ democracy which in turn increases cynicism among voters who feel they are all the same anyway.

Cynicism when dealing with politicians is always recommended but as with everything, moderation should be the watchword. By signalling to politicians that bad behaviour is expected of them and not raising the status of those who remain loyal enough, we are lowering the cost of the very thing we hate. If you let a politician know that you expect bad behaviour from him, he will ‘deliver’.

I don’t have data but how much does defection pay anyway? Would be nice to compare the number of elections won by politicians immediately after defecting to a new party with those of all others. The most high-profile one I can think of was Isa Yuguda in Bauch in 2007 who lost his party’s ticket, crossed over to another party, won the election and then crossed back to the PDP. But many people who do so regularly lose both ways, most notably an Ondo Senator who was part of 3 parties in the run up to the 2011 general election, losing 2 primaries and one general election in the process.


Given all these what are we to make of the much hyped difference between dagunro and tete? I think that, like many other Yoruba proverbs, the distinction needs to be updated for a modern reality. Indeed we live in a time of genetically modified foods being as mainstream as mainstream can be. A motivated scientist will not take too long to modify dagunro so it grows without thorns. And then what? It will be eaten like tete very easily, catching those who were relying on the status quo never changing, badly off guard. A few years ago, the thought of self driving cars would have been laughed out of the room, but here we are today. Assumptions are there for the taking for those who rely too much on them.

Ogbeni Rauf Aregbesola deserves all the commendation he can get for coming out on top in this battle but for the APC as a whole, there is no rest. There is so much work to be done by the party which faces a mortal danger of being annihilated in next year’s general elections, giving the PDP an implausible bigger vote share than it has now. A useful opposition party is such a critical part of the democratic furniture that we cant afford to have a hopelessly weak one. This is why some countries pay parties with tax payers money to oppose the government elected and funded by taxpayers. Here in the UK as an example, Her Majesty’s Leader of The Opposition, gets a salary rise from roughly £65k to £140k when h/she’s elected opposition leader to bring him/her in line with the Prime Minister.

A big shout out to all those who made the victory possible, but the work is still very plenty.


Boom Time?

This will be the high point of my day, it’s all downhill from here” – Lester Burnham, American Beauty


Given that when it comes to government revenues, we are an oil based economy, what kind of times do we live in? The numbers suggest we are in an economic boom, regardless of what the reality ‘on ground’ might be.

I thought to do a comparison of Obasanjo’s first term in office and GEJ’s first 4 years in office viz oil prices and government revenues:

1999 – 2003


The dates I used are from May 29th, 1999 to May 28th, 2003. In June ’99, oil prices touched $15.86 while the highest point was September 2000 when prices hit $33.15. As is evident from the chart, prices fluctuated quite a lot in those 4 years – indeed the high and low points happened within almost a year of each other.

Think of it another way – oil prices closed at $21 at the end of 1999 so if legislators were going to budget based on that for 2000, it would have been a bit of a mess because within 5 months (May ’00) prices had dropped below that high point. Perhaps this uncertainty is what caused that government to save money like it did and not really spend on big infrastructure projects.

2010 – 2014

chart (2)

The dates used here are from May 6th, 2010 when GEJ officially took over and July 31st, 2014. The lowest point of the period was in that same May when prices were $70 per barrel i.e. since GEJ came to office, prices have never been lower than he met them. The high point was in March 2012 when they hit $125. Other than that, from the graph you can see that prices have been fairly consistent around the $100/barrel mark.

I am not sure any Nigerian leader has enjoyed this kind of boom before. As an example, the chart below is for the IBB years – August 1985 to August 1993:

1985 – 1993

chart (3)


Can you guess what that sharp rise in 1990 one is? (Hint: Pius Okigbo report). In October 1988, oil prices hit a low of $12 and in October 1990, they hit a high of $36.

Barring a miracle, GEJ will be re-elected as President in February 2015. It’s worth thinking about what his second term might look like just in case his oil price luck runs out changes. It’s possible for things to get even better than they currently are. The chart below is for Obasanjo’s 2nd term as President:

2003 – 2007

chart (4)


The direction of travel is unmistakable – the lowest point of $26 was in May 2003 and the highest point was in July 2006 at $74.

With all that mind, here are some random thoughts:

1. Can you name any major project being carried out by this government that is not being funded by a loan or grant? From 2nd Niger Bridge to all the various airports being built. This is a genuine question as I am sure there are some big projects funded with oil revenues but which aren’t so obvious.

I tried to use a FoI request to work out how much foreign aid and loans were being used to fund the budget but so far there’s been no response.

2. In March 2011, GEJ signed the new minimum wage of N18,000 per month into law, up from N11,000 per month. What is often not understood is that organised labour got the government to maintain the difference between the bands after the new minimum wage came into effect. The effect of this was to almost double all salaries.

This partly explains why the Finance Minister was complaining recently that the FG’s wage bill had risen from N857bn in 2009 to N1.8trn this year – the bulk of that increase would have happened post the new minimum wage. She says the wage bill is for 1.2 million workers but the workers themselves say there are only 870,000 of them in the work force. But note that they do not dispute the N1.8trn being spent only on who it is being spent on. Whatever the truth may be as to the actual number of workers – we are spending around 38% of the budget on less than 1% of the population.

3. Bear in mind that the planned budget deficit for this year is almost N1trn (it could be more, it could be less) and there was only one surplus month between May 2013 and June 2014 i.e. a month where the government spent less than it earned.

4. Given that the bulk of government’s revenues still come from oil revenues and its finances are at full pelt at the moment, what do you think might happen if oil prices were to fall to say, $75 for around 6 months? Or what if we cant sell as much crude as we normally would? Certainly not that far-fetched – it’s getting harder to sell our crude quickly on the international market (partly due to the Americans not buying as much as they used to). By the 3rd week of July, around one-third of the August cargoes remained unsold.

As a business owner, will you be willing to pay more taxes to support the ‘Transformation Agenda’ if oil prices start to drop? Definitely worth thinking about.


A couple of people have taken me to task about comparing 1999 – 2003 dollars with 2014 dollars without using a base year. So I have inflated the 1999 – 2003 numbers to 2014 dollars. For example, $1 in 1999 would be worth $1.42 today, $1 in 2000 would be worth $1.38 today and so on.

So taking that into account to update the numbers, you get a chart like the one below:


Screen Shot 2014-08-07 at 12.21.37

Apologies for the dodgy looking chart but you get the gist – the low point of June 1999 which was $15.86 back then would be worth $23 today, around a quarter of current prices while the high point of September 2000 which was $33.15 back then would be worth $46 today, around half of today’s prices. In other words, comparing the first 4 years of both terms means that the current government is doubling the best revenues that the Obasanjo government ever managed.



Spot The Difference

Much noise has been made and continues to be made about Nigeria’s magic auto policy. By the way, I found what I think is a copy of the policy at the National Automotive Council’s website here. Nothing new in there except that I found an admission that prices will rise (page 105) even though the government continues to deny it. There’s also a lot of exclamation mark usage as if to drive home the point. But that is neither here nor there.

So a few days ago, the Director of Policy and Planning in the National Automotive Council, Lukman Ahmed, gave Nigerians this wonderful news:

The National Automotive Council on Tuesday announced that plans had advanced for about 30 vehicle manufacturing plants to open business in the country.The Director, Policy and Planning, Lukman Mahmud, said this was in line with the Federal Government’s plan to ensure local production of vehicle components begins in-country.The arrangement would ensure the distribution of vehicle parts through the Nigerian automotive industry at competitive prices, to create employment opportunities for the people.Prior to the introduction of the National Automotive Industry Development Plan by the Federal Government in 2013, the country had 14 existing plants at different locations in the country.According to Mr. Mahmud, the provision of incentives and protection to the industry under the new auto policy persuaded 16 fresh companies to establish their assembly plants in the country.

This is fantastic news indeed. Especially because many countries are dying for this kind of investment. As I have said previously, some countries actually bribe car manufacturers to come and setup plants in their country. In terms of investments, a vehicle manufacturing gig is one of the best ones a country can hope to have. It’s not just the jobs it creates, but the quality of those jobs as well. Workers get trained in very useful skills and a single vehicle plant can be the economic lifeblood of a town for decades. Here in the UK, if you take Nissan out of Sunderland, devastation is what you will get in its wake.

Yet Nigeria, simply by publishing a document, is now in danger of being overrun by so many manufacturers who want a piece of the action. The fact that Toyota felt the need to publish a disclaimer in the papers need not detain us here. They are simply haters who wont know a good investment if it landed on their lap.

photo (2)


Be that as it may, I want to do a quick comparison around the world of investments in car plants just so we know what we are getting in Nigeria. That way if, God forbid, things don’t go according to Aganga’s plan, we can at least know where things went wrong.

As we know, Nissan has been the first out of the blocks to start ‘making’ cars in Nigeria under the ‘Proudly Nigerian’ slogan. Thankfully, when carmakers announce new plants in a country, they tend to issue a press release about it which summarises their plans and what they hope to achieve. With that in mind, let’s sample some Nissan announcements.

On y va Brazil

In January Nissan announced a new engine plant in the Resende Industrial Complex in Rio de Jainero [emphasis mine]:

Nissan will invest R$140 million in the construction of the engine plant and will generate approximately 200 direct jobs. The industrial unit will use an existing building adjacent to the Vehicle Plant and will begin its activities with the production of the 1.6-liter, 16V I-4 flexfuel engine, with 111 hp and torque of 15.2 kgfm – when using ethanol – one of the most efficient in the Brazilian market.

Also this bit

The local production of engines makes the project of Nissan’s Industrial Complex in Resende a complete center. With investments totaling R$2.6 billion (U.S. $1.5 billion), the industrial unit will be one of Nissan’s most sustainable in the world, and will originate in 2014 two Brazilian cars: Nissan March and Nissan Versa.

On y va Thailand

Only a couple of weeks ago, Nissan announced its second plant in Thailand to produce the Navara:

Nissan today announced the opening of its second production plant in Thailand. The new plant will be a production hub for the NP300 Navara, Nissan’s new generation pickup truck, destined for export to 45 countries around the world. Thailand is a key market for Nissan, an integral part of their growth strategy in Asia. The country now boasts two plants and an R&D facility, and is increasing in importance as the company’s Asian hub for exports and manufacturing. Nissan has invested 3.7 billion Thai Baht ($116m) in the 580,000 square meter facility, bringing with it 2,000 new job opportunities. Full production capacity is expected to reach 150,000 units per annum.


Nissan has also invested 162 million Thai Baht in the new plant’s zero discharge program, and will recycle all industrial wastewater through the Reverse Osmosis (RO) process. Nissan will continue to provide training to subcontractors and employees to raise the awareness of waste management and resource reduction

On y va Mexico

In June, Nissan announced an alliance with Renault and Daimler to build a new plant in Aguascalientes, Mexico:

Renault-Nissan CEO Carlos Ghosn and Daimler CEO Dieter Zetsche announced today that their companies have agreed to establish a 50:50 joint venture, the business entity that will oversee construction and operation of the new plant in Aguascalientes in north-central Mexico. The new plant will be built in the immediate vicinity of an already existing Nissan plant and will have an annual capacity of 300,000 vehicles when fully ramped up.

Start of production is planned for 2017 with Infiniti models. The production of Mercedes-Benz brand vehicles will follow in 2018.

Daimler and Nissan will share the total investment cost for Aguascalientes of approximately €1 billion. The companies will add almost 5,700 jobs (including engineering, line workers and support staff) by the time the plant reaches full capacity, expected in 2021. In addition, a high localization rate will significantly increase the Mexican supply base


In November, Nissan opened the first stage of a US$2 billion manufacturing complex in Aguascalientes. This increased Nissan’s total capacity in Mexico to more than 850,000 vehicles annually

On y va Indonesia

In May, Nissan announced the opening of its second plant in Jakarta:

Nissan today inaugurated its new manufacturing facility in Indonesia. The second plant in Purwakarta, Indonesia, represents an investment of 33 billion yen (US$325m) and is a significant step forward for Nissan to become a leading brand in the country. The investment is also an important part of the company’s market expansion plan stated in its six year mid-term business plan, Nissan Power 88.

The 60,000 m2 facility includes body assembly, paint, trim and chassis operations. With the expansion, Nissan increases its production capacity in Indonesia from 100,000 units per year to 250,000 at full ramp-up. The new plant will generate up to an additional 3,000 jobs in the region.

On y va China

Two years ago, Nissan announced a new plant in Dalian, China under its joint venture programme with Dongfeng Motor Company:

Dongfeng Motor Co., Ltd. (DFL), Nissan’s joint venture in China, today announced it will build an all-new manufacturing facility in Dalian, Liaoning Province, China with an investment of up to RMB 5 billion (USD $800 million). The Dalian plant, scheduled to begin manufacturing NISSAN-branded passenger vehicles, will have an initial annual production capacity of 150,000 units by 2014, and will expand up to 300,000 units.

On y va Russia

Also in 2012, Nissan announced a new plant in St. Petersburg, Russia:

Nissan is targeting a 10% share of the rapidly growing Russian market by 2016 (up from 5.9% today) which will be achieved by tripling annual sales from the 2011 total of 161,000 units.

To support this, capacity at the St Petersburg Plant will double to 100,000 units in 2014FY The announcement follows last year’s capacity increase at the plant which currently manufactures the Teana sedan, X-TRAIL SUV and Murano crossover, to 50,000 following the introduction of a third production shift.

Nissan will now invest a further €167m to add 50,000 square metres of new production facilities, including Press and Plastics Shops. As well as bringing total plant capacity to 100,000 units, the expansion will enable St Petersburg to produce up to five different models simultaneously

On y va India

In 2010, Nissan started production at its new plant in Chennai, India. As usual, it announced it:

The plant at Oragadam, spread over an area of 640 acres, represents an investment of 45 billion Rupees ($990 million) and the capacity to produce 400,000 units per year at full ramp up. Today, the plant employs 1,900 workers and will reach 3000 in two years time. The company, along with its supplier park in Chennai, estimates a total of 6,000 jobs to be created in the region.

Ok I can see you rolling your eyes which tells me you are getting bored with all these. So one last one

On y va Portugal

Five years ago, Nissan announced a new plant in Aveiro, Portugal to produce car batteries:

Under the agreement with the Government of Portugal, Nissan will invest over €160 Million in the new facility and directly create 200 new jobs at the plant. This investment follows the announcement in November 2008 that Portugal will work with the Renault-Nissan Alliance to implement a zero emission mobility program from 2010. Within this plan, the Alliance will supply its electric vehicles from January 2011, and the Portuguese government will leverage an extensive network of 1,300 planned recharging stations that will be installed across the country over the coming two years


All the press releases are taken from Nissan’s websites. Feel free to click on the links. Now that we have been around the world and have a decent idea of how Nissan announces production in a country, we only need to compare these with their announcement in Nigeria. Apologies, but I will paste the whole press release from April this year below:

Nissan today became the first major manufacturer to build a car in Nigeria in response to the introduction of the new Nigeria Automotive Policy.

The inaugural vehicle, a Nissan Patrol, rolled off the production line at the Lagos assembly plant, marking a key milestone in the company’s continued wave of expansion into high-growth markets.

Nissan is targeting significant growth in Africa as the company builds momentum towards achieving its Power 88 goals, a commitment to reach 8% profitability by the end of fiscal year 2016. Elsewhere in the world as part of the high-growth markets strategy, plants have been opened in Mexico and Brazil with projects underway in Indonesia, Thailand and China. Last year Nissan announced it will be the first manufacturer to build cars in Myanmar, after the opening up of the economy in the south-east Asian country.

The first “built in Nigeria for Nigerians” Nissan Patrol follows the signing last year of a Memorandum of Understanding for vehicle assembly in Lagos between the Renault-Nissan Alliance and West African conglomerate Stallion Group.

Since then, preparing for production in Nigeria to global production standards has been achieved at a rapid pace, setting a new benchmark in responsiveness and organisational agility.

Takashi Hata, Nissan Senior Vice President and Chairman for the Africa, Middle East and India region said: “For Nissan, Africa is our strategic growth driver. Demand for cars is growing quickly in African markets as demonstrated by the first model being produced a mere seven months after the announcement of the new Automotive Policy. By acting quickly to begin production in Nigeria we are securing for ourselves first-mover advantage.”

Nissan South Africa Managing Director Mike Whitfield, who also heads up Nissan’s Sub Sahara Africa region, is delighted with the successful launch of the first Patrol. “Nissan was a pioneer in the foundation of the car industry in South Africa. Now we are once again at the forefront of manufacturing in Africa, this time in Nigeria where we see huge potential. We want to play our part in the economic growth of Nigeria and Africa.”

The rollout of the first Nissan vehicle comes shortly after confirmation that Nigeria’s booming economy has now overtaken that of South Africa. Africa’s most populous country is pivotal to Nissan’s mid-term growth plan, which seeks to double sales on the continent by FY2016, up from 110,000 units at the end of FY2012.

Nissan’s growth strategy in Africa gained momentum with the introduction this year of Nigeria’s new Automobile Industrial Policy, aimed at stimulating development of the auto industry in the country.

“We are grateful to the Nigerian government for implementing automotive legislation that is conducive to investment and that was instrumental in our decision to open an assembly plant in partnership with the Stallion Group, already our exclusive distributor in Nigeria,” added Whitfield.

Nissan anticipates vehicle demand to increase in this oil-rich country, which is seeing a rise in fast-growing industries including finance, retail, communications and film.

In addition to the Patrol, Nissan also plans to produce the Almera and NP300, starting in early May and followed by mass production in August. With these three models, Nissan aims to be a significant player

Hmmm. What’s going on here? Where is the money? From what we can see from all the examples above, a car plant is a serious investment and costs a lot of money. And Nissan never fails to tell you how much it has invested or plans to invest in the future. But these rules have been suspended in Nigeria – without investing anything, Nissan has managed to roll out cars ‘built in Nigeria for Nigerians’.

There is no mystery here – no investment has been made in the country. This auto policy has handed them a captive market without any upfront commitment from them in terms of hard cash. Nigerians should remember this in future when they are tempted to complain about ‘foreign companies ripping us off’. If you were Nissan, would you do different? Simply by removing the tyres before importing and then adding them back when the cars land in Nigeria, you have qualified as a ‘car manufacturer’ in Nigeria. Even the plant where this ‘assembly’ is going on in Lagos was already assembling buses long before the noise of this ‘auto policy’ started.

It’s not even the end of the world if things like this happen. Anyone is free to come and build cars in Nigeria without investing anything. Good luck to them. But to make a song and dance about how your ‘policy’ is causing a stampede of investors and then – adding insult to injury – raising tariffs on Nigerians in the name of this briefcase investment is completely ridiculous. When you see carmakers coming to invest in Nigeria, you will know. And the government will need to back up such investments with more than a badly written piece of paper.

As usual, we have turned a serious matter into a joke. Something which costs hundreds of millions of dollars in other countries has ‘transformed’ into a thing so trivial that 16 manufacturers are coming to Nigeria to just be littering the country with car plants. We know how this movie is going to end.

Left to Ifeanyi Ubah, Chief Cosmas Maduka is doing nothing more than ‘pure water business‘. But credit where credit is due, the man has been selling cars in Nigeria for a while and probably knows a thing or two about how the industry works. Recently he gave an interview to CNBC Africa on the ‘auto policy’ and after starting off by pledging his loyalty to said policy, he let slip his real thoughts on the thing. The video is here

Around the 4 minute and 20 second mark, you hear him say ‘we should not do things just to get attention‘ in reference to the auto policy. Or perhaps the minister.

Maybe this is what this is all about then. In which case, nothing much to worry about as the policy will probably die a natural death after the elections next year. Vote wisely because your vote will not be refunded if you hand it to anyone on the expectation that 30 car plants are going to start production in Nigeria.



Simon Kolawole’s Watery Cement Argument

If you think the problems we create are bad, wait for our solutions” – Government

Simon Kolawole is back pushing his argument for the justification of phasing out 32.5 grade cement in Nigeria. In his latest backpage column for ThisDay, he tells us how a part of a building site behind his house collapsed last week Friday. As is the case when these things happen, it’s always a tragedy and people are injured if they are lucky enough not to lose their lives.

However, in record time, Mr. Kolawole has managed to investigate this building collapse in 48hrs and concluded that it was caused by low-grade cement (in fairness, he admitted later in the piece that cement grade is not the only cause of buildings collapsing). He then goes to throw a few jabs at people (like myself) who were opposed to banning 32.5 grade cement [emphasis mine]:

Recently, when I added my voice to the clamour for the standardisation of cement in Nigeria from 32.5 megapascals (mpa) to 42.5 mpa – which industry experts say is far better because of its setting strength, yield and adherence capability – I was shocked at the fierce opposition by some Nigerians. Not even evidence from across the world that 32.5mpa cement was going out of fashion could convince the critics. Some even rejected the proof that India and China had decided to entirely phase out 32.5mpa from the construction industry – either for plastering or concrete work.

My shock was: how can anyone reject a proposal to improve construction standards in Nigeria, with all these gory tales around us? Does it make any form of sense at all? I was glad that the blackmail and intimidation did not work. The House of Representatives has taken a position on the need to standardise cement in the country and the Standards Organisation of Nigeria (SON) has also signed on to it. Industry players are now finally shifting ground and accepting that they will now do the right thing. BUA, Ibeto Cement and Dangote Cement have all committed to upgrading cement quality. We don’t stand to lose anything

This is the typical watery stew argument that Mr Kolawole is fond of serving his readers in ThisDay. Yes, Simon, it makes sense. It’s interesting that people who opposed this move have now become ‘blackmailers’ in the book of Mr Kolawole. For having a different opinion? Wonders. Once you start hearing people say ‘there’s nothing to lose’, it’s a good sign that you are the one going to pay for the experiment, not them.

What is the ‘proof’ from China that he’s speaking about? It is true that in January of this year, the China Building Material Academy announced plans to phase out the 32.5 grade of cement this July. Why are they doing this? The answer to this question is very important because it helps to illustrate how Nigerians copy policies from one country and by the time it arrives in Nigeria, it is something completely different yielding the opposite result.

The first clue in answering that question is this recent tweet and chart from Bill Gates:

Screen Shot 2014-07-20 at 14.44.52

As statistics go, that’s one of the most staggering we’ve seen in recent times – in just 3 years, China used more cement than the US did in 100 years. How did this happen? A basic understanding of the Chinese economy lets us know that the Chinese have ‘over-invested’ in a lot of areas. The kind of investment that has gone on in China in recent years is unprecedented in human history. To achieve this kind of staggering cement output, they have been expanding output for years. No expensive degree in economics or business is required to understand that when a company invests $1 back into the business, that is $1 that cannot be consumed by shareholders. In other words, for the owners of the business, the more a company invests, the longer it takes for them to realise a return on their investment. The game gets longer and longer.

As at 2012, there were approximately 3,000 – yes, THREE THOUSAND – cement manufacturers in China of different sizes. This explains why the market is hyper competitive with rock bottom prices and massive output as illustrated above. No genius is required to know that the Chinese government is the biggest shareholder in the biggest Chinese manufacturers there. As an example, the table below shows the shareholders in the biggest manufacturer of cement in China, Anhui Conch [taken from their 2013 annual report here]:

Screen Shot 2014-07-20 at 15.04.21

The biggest shareholder is the state-owned Conch Holdings. No point going through all the other big players – the pattern will be the same. The SOE model of China invests in different companies and allows them to compete fiercely against each other.

So with all this information, here’s the actual reason why China is phasing out 32.5 grade cement:

Screen Shot 2014-07-20 at 15.08.34


This is the answer you will find almost everywhere – in an industry with 3,000 players producing a ginormous amount of cement, the government wants to reduce competition so it can start to make returns on its huge investments in the sector. Most of the smaller players in the industry produce 32.5 grade which is of course easier to manufacture. By getting rid of the smaller guys, the big guys who have spent enormous amounts to increase their capacity can gain a larger share of the market and deliver better returns. If Mr Kolawole has any other sources that show that 32.5 grade is being phased out in China over safety concerns, he should kindly share it and educate the rest of us.

This is how we Nigerians see a medicine that was used to treat depression successfully in one country and then bring it to Nigeria to treat malaria. For Mr Kolawole, it is enough that China is phasing out 32.5 grade cement. There is no need to interrogate further, Nigeria must do the same thing. ARE YOU A BLACKMAILER AND DENIER OF PROOF?! Or do you not want Nigeria to be like China?

And yet, not only are our industries completely different, the problems being solved are two completely different things. In Nigeria we barely have 2 serious players in the cement industry and one controls over 60% of the market. We are nowhere near the kind of market that should be reducing choice and competition for any reason at all. Until prices start to come down and cement manufacturers are no longer making 50% profit margins, we should look to increase competition. We have so many houses to build and complete.

Yet it does not matter to Mr Kolawole that he probably lives in a house built with 32.5 grade cement or works in an office built with the same 32.5 grade or the reality that 99.9% of buildings in Nigeria do not collapse. Something must be banned. And of course since Aliko Dangote has said it, how can it be wrong?

No doubt about it, even one collapsed building is almost always avoidable. But this should lead us to ask serious questions as to why many many buildings built with the same cement do not collapse and some do. How can it be the cement? The proof that Mr Kolawole is ignoring is how this whole move has been an elaborate puppet master scam. I have documented in a previous blog post how this all began with one ‘Tunde Ojo’ and a faceless coalition of civil society groups in the civil construction industry in February of this year. This ‘Tunde Ojo’ has since disappeared, along with his coalition, from the face of the earth. Nigerians are being strung along and of course people like Mr Kolawole do not want buildings to collapse near them.

This banning of 32.5 grade cement is the surest way to take a problem that affects a small number of people – each one a terrible tragedy – and spread it across the whole population. In the name of keeping Nigerians safe, their pockets will now be picked even more forcefully by the same people who are already selling them cement at 3 times average global prices. The deed is of course now done and there’s almost no turning back. But it’s useful to understand that even as powerful as government and its crony capitalists friends are, it still needs journalists like Mr Kolawole to shill for them with emotional arguments containing approximately 0% logic.

This is the real tragedy. When the government, business and regulator are all in bed together, the only hope is the press. No one is asking Mr Kolawole to accept or reject the argument against 32.5 grade. But for Pete’s sake, dig a little deeper into the arguments and let your readers come away from you more educated. What we are getting is an eagerness to ‘conclude the matter’ in favour of Aliko Dangote and co.

I wonder why….




The Mekunu Revolution

I sent someone to a barber shop nearby just to hear what they are saying about my governor there. He said the barber was just complaining about how the governor is not giving them money. When they now pointed to a big school opposite his shop that the governor is building, he said ‘is it the school that we will eat?

That was a friend of mine who works in one of the South West states in Nigeria in the wake of Fayemi’s loss in Ekiti.

It is hard to escape the feeling that Fayemi’s loss has left a lot of incumbents feeling uneasy because they fear that the issues which toppled him are not unique to Ekiti. There is a Mekunu Revolution afoot and it threatens to consume any politician who stands in its way. But what is it all about? The answer likely lies in the way politicians have been reacting to whatever it is.

Fayemi himself kicked things off a month to the election which removed him from office by reversing his own reforms:

Ado Ekiti — Ekiti State Governor Kayode Fayemi yesterday went back on the decision of government to organise the controversial Teachers Development Needs Assessment (TDNA)for teachers in the state. Fayemi also announced the decision of his administration to commence payment of the 27.5 per cent Teachers’ pecuniary allowance.

Because it worked so well for Fayemi, Edo state has now decided to do the exact same thing:

Edo State Government has reversed the planned competency test for teachers in the state  and  recalled the 936 teachers whose names were deleted from the payroll over certificate discrepancies and age falsification.

This is depressing stuff. Presumably, the teacher who couldn’t read her own certificate last year when questioned by Oshiomole himself is part of the 936 teachers recalled:

Not to be left out, Governor Amosun in Ogun State has declared a ‘naira rain’ for civil servants who now have the bit between their teeth and are threatening to do him a Fayemi:

OGUN State governor, Senator Ibikunle Amosun, has approved car and housing loans for civil servants as a way of boosting their morale and efficiency at work. Amosun also  promised to implement 27.5 per cent Peculiar Allowance for teachers, as well as payment of outstanding allowances.

As anyone knows, this is as good as a gift to the workers. To further boost the productivity of these amazing civil servants who produce so much, Ogun State went ahead to build a dedicated market for them where they can shop in peace and quiet away from the Great Unwashed Masses:

‘Oja Irorun,’ a farm produce market for public servants constructed by the Ogun State government, has been established at the state secretariat, Oke-Mosan, Abeokuta.

The Head of Service, Mrs Modupe Adekunle, while declaring the market open, said it was an avenue for civil servants to shop with ease.  Mrs Adekunle noted that the market would be opened every Friday and would enable workers to purchase fresh farm produce, which would improve their healthy living.

In addition to all these there are the well worn complaints from Ekiti that Fayemi gave contracts to ‘outsiders’. This is now reverberating in Osun State where Ogbeni Rauf is being accused of hiring the ‘foreign’ Sam & Sara to set up the Omoluabi Garment Factory in Oshogbo to produce school uniforms. Sam & Sara, the complaint goes further, then went on to perpetrate the dastardly crime of hiring Igbos (who are not Nigerians) to staff the factory. To make matters worse, Ogbeni’s opponent, Senator Iyiola Omisore, unencumbered by any morals, scruples or underpants, has been playing up his ‘man of the people’ credentials by making sure he is photographed riding shotgun on a motorcycle, eating roasted corn and guguru (a derivative of corn, it must be noted).

photo (2)

Does it matter that the man is wearing what looks very much like an Audemars Piguet watch on his wrist? Afterall, the watches have a starting price of a mere £12,500.

What does this all mean for our democracy? I fear things are not looking good. For starters, the electorate seem to be sharply dividing into ‘the masses’ and ‘the elitists’ who cannot drink their coke without a dash of lime in it. The whole point of running for office is quickly boiling down to the question – na who grassroots pass?

Yet, and for personal reasons, I feel this is all sadly very wrong. I am by no means a rich man today (infact if you were to offer me some money today, I will happily relive you of it) but only a few years ago, I experienced what it felt like to be desperately poor. I was raised by my mother, almost single-handedly, and anyone who grew up in the same shoes will know how difficult, and often impossible, that task is. While I was in University in Nigeria, my Mother went through a terribly difficult financial period where my ability to continue going to school was under serious threat. In the end, an Uncle came to our rescue and the evil day was averted. Perhaps you might not be reading this blog post if things had turned out differently.

Yet, what I remember vividly from that whole period was how that desperate financial situation turned my mother and I against each other. I felt she wasn’t doing enough to find the money and she of course felt I wasn’t appreciative enough of her efforts. And on and on it went until a resolution was found. This is what I know poverty does to you – it turns you against whoever is near you and stops you from thinking properly. Come with me to the book of Proverbs, the 15th verse of the 15th chapter [Amplified], the first part:

15 All the days of the desponding and afflicted are made evil [by anxious thoughts and forebodings]

The emphasis is mine because ‘foreboding’ is exactly the word to use to describe the kind of poverty I knew. If it goes on for too long, people begin to think it is permanent state of affairs and cease to think about tomorrow. I recall reading a story some years ago which tried to explain why the January 2010 earthquake in Haiti killed 220,000 people. One of the reasons given was that there was so much foreboding in the country long before the earthquake that people could not be bothered to put basic fortification in their homes. Something was bound to come and kill them anyway so why not spend the money on something else?

When you begin to hear people asking if they are to eat the roads and schools provided for them, you are seeing a dangerous sense of foreboding. In our case as a nation, this foreboding has been caused by years and years of mindless theft and squander of our commonwealth by people who pretend to be our leaders. What the ‘common man’ sees is a system awash with naira and dollars and he cant seem to find a way to lay his hands on any of it. The people no longer want schools; they want money in their pocket. They do not really care if a school or road is built properly – they want it to be built by a local contractor who will ensure they get some of the money. All this requires is for a politician to promise to do these things and he will get a hearing.

Predictably, where leadership is required, our politicians, who had no convictions to begin with and have spines made of chocolate, have utterly capitulated. Was there no reason in the first place why construction contracts were given to reputable (the other name for ‘outsiders’) firms? A bad contractor is a bad contractor, period. This is an opportunity for governments to crackdown on those who do terrible jobs and use that as justification for the decisions they make. Is there no cost to bad teaching? Why were the reforms instituted in the first place? Is there any more evidence required for teaching reform than looking at the shambolic state of our education which does not equip anyone to solve the problems facing us as a nation. And surely, there are people who have benefitted from these reforms – where are they to act as cheerleaders for it?

It is not that ‘the masses’ are stupid and do not know what they are doing. Far from it. I think that those who exchange their votes for money know exactly what they are doing. There is a foreboding and the people want to take their payment upfront or perhaps ‘eat their seed corn’. Why be patient with a politician who promises reform when chances are that he is lying and stealing anyway? There will be no tomorrow.

Where is this Mekunu Revolution leading us? I do not know for certain but I doubt it’s a very good place.

But the biggest message in all of this is that we now have a pretty good idea of how the vast majority of the population are against any kind of meaningful reform even if they all have different reasons for their opposition. Once upon a time, Baptists and Bootleggers in America were on the same side supporting alcohol prohibition too, as implausible as it sounds.

We can remain like this as a country for many many years to come.



Corporate Affairs Commission – Satan’s Embassy

I am not feeling in a particularly nice mood so I am not obliged to be generous or polite – the people who run Nigeria’s Corporate Affairs Commission are the First Born Sons of Satan (FBSS). They are the Devil’s Ambassadors in Nigeria carrying out his work for him.

The Vanguard carried a long story today about how the utter shamelessness of this organisation and how it cannot successfully run a tap let alone a bureaucracy. It is the story of how a body has chosen to be unreformable and will regress to the mean no matter how many times you try to change it. Completely smashing it is the only solution.

Make no mistake though – this is not anyhowness. That is a different phenomenon on its own. There is a bureaucracy at its worst – existing for no other reason other than to generate more bureaucracy ergo, any attempt to reduce some of this bureaucracy is resisted.

Barely two years after it was commissioned by the Minister of Trade and Investment, Mr. Olusegun Aganga, the 24 hours registration of businesses by the Corporate Affairs Commission, CAC, has collapsed due to technical hitches occasioned by server failure.

As a result, business registration now takes between one to three months, while business name availability search takes more than one week

No, there is no server failure anywhere. Not at all. In fact, nothing has failed. The system is working precisely how the FBSS want it to work – it is a characteristic of a bureaucracy to ‘make work’ where there is none. There is no Fermat’s Theorem to solve – simply putting a lot of these things online will cut the time to do register a company considerably and make things easier for everyone.

So why haven’t we managed to put the CAC’s processes online? It is not for lack of trying. Here’s what the World Bank said in the Doing Business Report a few years ago:


CAC Screen Shot

For nearly a decade, the FBSS have been resisting going online. Perhaps they have had no electricity since then. But the clue as to the reason for their behaviour is plain to see – even when they ‘experimented’ with going online, they still wanted people to come down to their office to complete the transaction ‘online’. Is this because you cannot collect a bribe online? Is it because you need physical interaction to facilitate a lot of corruption? I don’t know, you tell me.

One of the most annoying things about the Trade and Investment Minister, Olusegun Aganga, is that he has a habit of announcing things to much fanfare and newspaper headlines and then moving on to the next thing. As if, things are supposed to work by magic.

While unveiling the 24 hours business registration in November, 2012, the Minister of Trade and Investment, Mr. Olusegun Aganga said that, “The target is to ensure that companies are registered within two hours and to institute a vibrant and transparent companies’ registry, where services will be user-friendly.”

He had also at the time directed that a complaints register be opened for anyone who is not able to get his company registered within 24 hours. This he said was to show that, “We mean business and that we care about our customers.

If the FBSS have resisted online registration since 2005, defeating this 24 hour ‘announcement’ would have been no more than a cake walk for them. If Aganga cared about making business registration easier, he would not have left it to simply an announcement especially when the thing never worked for more than 5 minutes.

And this is the most ironic part of the piece:

This is also leading to loss of revenue on the part of CAC because any availability search initiated is paid for and if a particular name is not available, a client may have to pay again to initiate another search. The implication is that the more names they search for, the more money they make but now that availability takes like three weeks, it means they will generate less revenue from name search

We can assume that one of the main reasons why people register a business is to make money. Yet the people charged with being gatekeepers to this very business registration process are not interested in making money themselves. It’s not so difficult to conduct a name search if people are motivated to do it, yet the FBSS drag their feet and do it at their own pace (they also close to the public at 2pm everyday…no doubt after doing massive work). Their incentives are clearly elsewhere.

Why is business registration so important? The answer is in the failure rate of businesses. The benefit to society only materialises when those businesses start to make money, pay taxes and employ people. None of these is guaranteed. Instead, what is almost certainly guaranteed is failure – perhaps only 3 out of every 10 new businesses will survive past their second year maybe. Or to put it another way, to get 3,000 successful businesses, you need to register maybe 10,000 of them and be prepared for the vast majority to end up as failures.

By handing control of this process to the FBSS, we are preventing the necessary failure that leads on to success from happening. This is why making it easier to do business is such an important reform for countries. Beyond the actual reforms, it is a signal as to what kind of society a nation wants to be. Signalling that you are open for business is telling would be entrepreneurs that its ok come and fail so you can succeed. Instead what are we doing?

Screen Shot 2014-06-30 at 23.46.31

Almost every indicator worsened from 2013 to 2014. On Starting a Business, where the FBSS hold sway, we dropped down 8 places on the rankings. With Kenya launching mobile company registration today, it is almost certain that we will do worse next year.

People who stand in the way of doing business really are the children of the devil. They are economic Boko Haram. The thing they are preventing from happening is the greatest known antidote to poverty in the history of man. We need to wake up and resist this madness.

And we haven’t even spoken about the ridiculous costs of registering a business -charging a fortune for the privilege of having your business registered in 2 or 3 months.





Parsing The Ekiti Handwringing

A loss like Kayode Fayemi’s in Ekiti on Saturday was bound to generate plenty of commentary and analysis. Predictably, people want to nail down ‘why’ he lost given that he was quite popular on social media and in ‘elite’ circles.

I am not sure I know exactly why he lost, but some of the reasons being thrown around can be examined as a way of adding to the discourse. I am not sure some of the theories out there cut it and here’s why

Fayemi did not share money and even when he did, it was too little, too late 

This is one of the most common theories floating around and it is certainly true, give or take the odd embellishment. The people wanted ‘stomach infrastructure’ but Fayemi was too ‘tight fisted’ and didn’t cater to that need. By the time he realised and started sharing the money (that Fayose was presumably sharing liberally), it was too late and the tide had turned against him irretrievably.

The implication of this is that you cant afford to be stingy as an elected official in Nigeria. Even more worrying, it doesn’t matter how many roads you construct or projects you commission, if you don’t attend to this stomach infrastructure, the people might tell you to come and ‘carry the road’ you built for them. Also, if you have been stingy for long and you suddenly start bringing out the rice and money near the elections, the people will turn up their noses at you.

This explanation makes a lot of sense but it has one problem and that problem is Peter Obi.

You will struggle to find an Anambra man who thinks that Peter Obi didn’t perform while in office. The man generally served his state well and the people recognised that. But the ‘complaint’ you will hear from most people is that he was ‘tight fisted’ and never shared ‘money for boys’. More interestingly, if you followed the news in the final months of his governorship, you would have noticed the Naira rain he embarked upon – everywhere he went, he was donating one large sum of money or the other. My usually reliable ‘sauces’ tell me that he finally brought out the big guns, to the tune of N3bn, in the final few weeks of the campaign and shared it to get his protegé, Willy Obiano, elected. I’m told that Obiano had the mind to cancel some of the last-minute contracts Obi awarded before he thought the better of it. Obi never borrowed money and his ‘tight fistedness’ meant that he had cash to spend when he needed it.

So what gives? Why was Fayemi’s stinginess and last-minute money sharing punished so severely while Obi seemingly got away with the same ‘crime’? Aside from the obvious fact that Peter Obi is not Kayode Fayemi, I think the answer lies elsewhere in a more fundamental law of politics. I will proceed to name this F’s Law of The Opponent In Front Of You. You’re welcome. This law simply states that all electoral strategies and tactics are subject and subordinate to the opponent you are facing.

One of the most reliable tricks politicians, especially incumbents, have used to win elections since time immemorial is to label their opponents as ‘outsiders’. If you can successfully paint your opponent in an election as an outsider who is different from the majority of the electorate, you will be on solid ground. As an example, the frontrunner in the Indonesian presidential slated for July 9th, Joko Widodo, has recently been battling charges that he is a closet Christian. In the world’s largest Muslim country, this is a deadly ‘crime’ indeed and as such Jokowi has been scrambling to have his photo taken with popular Imams and releasing pictures taken when he went on the hajj.

Where Peter Obi and APGA could label Chris Ngige as an ‘outsider’ sponsored by ‘Bourdillon’, this tactic probably wont have worked with Fayose given that GEJ is not unpopular in Ekiti. If anything, the outsider tag was more likely to stick on Fayemi himself. But perhaps trying to label your opponent an outsider by tying him to GEJ might work in a state like Kano where GEJ is much more unpopular. Or perhaps not.

The point is that ‘stinginess’ is not a fatal flaw in a politician. Fayemi was not the worst governor in the world so even this sin could have been forgiven by the voters given a different opponent in different circumstances. So the message to any politician currently opening the treasury to flood voters with stomach infrastructure in a bid to win the next election – it might work, it might not work. It all depends on the opponent you will be facing and the atmosphere under which that election will be contested.

Fayose is popular with the masses

This is the one most people agree on. Fayose eats corn and banana with the ‘masses’ by the roadside. He knows his way around the streets and the people love him etcetera etcetera. One would think that popularity is all that’s needed to win elections in Nigeria these days.

In the 2007 gubernatorial elections in Ekiti, Fayose threw his ‘popularity’ behind the ANPP candidate, Yinka Akerele, who leveraged all the popularity and gallantly came third. After this, he moved to the PPA and then the Labour Party. In the next governorship election he threw his weight behind the ACN and openly campaigned against the PDP who still won the rerun election. Finally in 2011, he moved back to the Labour Party where he used his popularity to contest the senatorial election. He came a distant third. It was after this he moved back to the PDP from where he won last Saturday’s election.

The man’s a maverick, no doubt about that. But he’s also ‘anyhow’. And an anyhow candidate needs a solid structure to translate whatever talents or popularity he has into electoral victory. To put this victory down to Fayose’s ‘popularity’ is to miss a couple of important points.

First, Adamu Mu’azu’s appointment as PDP Chairman has been the political equivalent of replacing Shola Ameobi with Ruud Van Nistelrooy. I was joking with a friend earlier today that the APC should have gone to court to stop GEJ from replacing Bamanga Tukur as PDP Chairman. Not only has he stopped the PDP bleeding, he has infused it with new energy and put them back on the front foot. Observing him at the World Economic Forum in Abuja last month, he was everywhere talking to everybody. When he wasnt holding hands with someone gisting and walking briskly, he had his arms around their shoulder talking directly into their ears. Those who know him say he is full of cunning and if you spent years running succesfully from Ribadu and his EFCC, then you must have some useful political skills indeed. Putting the power of a newly invigorated PDP machine at the service of Fayose played a crucial role in converting whatever latent popularity Fayose had into victory at the polls. It doesnt happen automatically.

Secondly, political fashions are notoriously easy to misinterpret. Many politicians across the world have gotten elected purely by portraying themselves as the opposite of X, where X is a currently hated politician. Would Barack Obama have defeated George W. Bush in 2000? It is doubtful given that Bush won by being more folksy than Al Gore who people thought came across as too Professorial. 8 years later, Americans were tired of Bush’s folksiness and bad grammar and Obama the well spoken law Professor was in fashion inspite of the charges of elitism and arugula eating levelled against him. Francois Hollande campaigned against Nicolas Sarkozy in 2012 by telling the French people that he was ‘Mr Normal’, in contrast to Sarkozy who often acted like he was crazy.

There is a tide in the affairs of men,

Which taken at the flood, leads on to fortune.

Omitted, all the voyage of their life is bound in shallows and in miseries.

On such a full sea are we now afloat.

And we must take the current when it serves, or lose our ventures

It’s hard to imagine that a candidate is ‘permanently popular’ anywhere. They go in and out of fashion and the smartest ones are those who take the current when it serves. The people of Ekiti had come to dislike Fayemi and his style of governance. They were tired of his ‘elitism’, real or imagined. Tomorrow they may come to desire elitism once again. It’s the nature of democracy and the way voters like to change their minds every so often.

To paraphrase the immortal words of Ice-T – Fayose didn’t choose the game, the game chose him. To take Fayose’s victory as some kind of Iron Law which repudiates elitism is an interesting conclusion if not hilarious.

The scale of Fayose’s victory

This aspect of the outcome is curiously being treated by many people as something normal. As if, incumbents always lose elections so heavily in Nigeria to the point of losing every single local government in their state. I remember during the 2011 guber elections in Nigeria. I had voted in Lagos and the results were more or less a formality for Fashola who was quickly announced as the winner. But in Oyo state, getting out Akala was never a walk in the park. I kept texting a friend in Ibadan to ask if the results had been released and in the end an Army General was drafted in to escort the final set of results to INEC’s office.

You don’t just beat an incumbent in Nigeria. No matter how bad the person was and even the most uncharitable people wont say Fayemi was the worst Governor in Nigeria’s history. It’s a big job and incumbents go down kicking and screaming. So how did this happen in Ekiti?

The one thing most people can agree on is that INEC did an excellent job on Saturday. A few changes were made which made things like ballot snatching a waste of time. Around 2pm, a friend who was in Ekiti said ‘it’s over. Fayemi has lost…he’s losing everywhere’. And that is exactly what happened – he lost everywhere.

If this was all down to INEC’s improvement, then the logical next question to ask is – how many governors have been losing elections in Nigeria in reality but manage to return to office using the power of incumbency? If Fayemi could lose in every local government, then it is safe to say many governors in the past have also lost every LGA in their state. Yet, this is the first time we have it on record as this happening.

If INEC keeps up this level of performance, then we can expect many many incumbents to lose elections spectacularly next year. Voters will vote out many politicians ‘for the fun of it’ or to test their new-found powers.

So what does this tell us? Was Fayemi uniquely bad as a governor? Or was he the pioneer of a new trend we are going to see a lot more of? If it’s the latter as I suspect it is, then in a few months time, this defeat will be overtaken by much bigger ones.


I don’t know exactly why he lost. I suspect it’s a number of things and not just one thing. But I know that a lot of reasons being given don’t quite cut it and many will learn the ‘wrong’ lessons from this. But what do I know.

Sorry I made you read nearly 2,000 words without giving an answer.



Who Pays The Taxes Around Here? Not Seplat

First let me state a couple of points

1. I hate taxes. I am from the school of thought which defines taxation as the art of plucking the goose with the least amount of hissing. So you will never catch me arguing for higher taxes (except when there’s an externality that needs to be dealt with or bad behaviour corrected). Nevertheless, I think that what is worse than taxation is a system that allows different people to play by different rules. If taxes are levied at a 99% rate, I can live with them insofar as some people are not finding a way to game the system and end up paying only 10%.

2. I don’t really understand the oil and gas business. My knowledge of how things work there is perhaps no more than basic. So part of my reason for writing this post is to learn some more. I invite you to use the comments section under this post.

Industrial Development Act

Nigeria has something called the Industrial Development Act which was passed to encourage investment in the country. If you build a new plant or industry, you get exempted from paying taxes on it for a number of years. This is a good thing of course because if a company had a choice between investing in say Kenya and Nigeria and Kenya does not offer such incentives, then this law can easily swing things in Nigeria’s favour.

But rather than speculate, let’s quote from the law itself as amended in 2004:

Pioneer conditions

1Publication of list of pioneer industries and products and issuing of pioneer cer- 

(1) Where the President is satisfied that-

(a)       any industry is not being carried on in Nigeria on a scale suitable to the eco-
nomic requirements of Nigeria or at all, or there are favourable prospects of
further development in Nigeria of any industry; or

(b)       it is expedient in the public interest to encourage the development or estab-
lishment of any industry in Nigeria by declaring the industry to be a pioneer
industry and any product of the industry to be a pioneer product,

That’s from Section 1 of the act. Pretty straightforward to interpret that this is something that should apply to new industries in the country i.e. something we are not currently doing but we want to or something we are doing but not enough. So we can safely conclude that a pure water manufacturing company should not be able to get pioneer status based on the letter and spirit of that law.

So far so uncontroversial. If we move down to Section 10 of the law, we see how long the pioneer status is supposed to last for:

10. Tax relief period

(1) The tax relief period of a pioneer company shall commence on the date of the
production day of the company, and subject to sections 3 (6) and of 7 (2) of this Act, the
tax relief period shall continue for three years.

(2) The tax relief period of a pioneer company may at the end of the three years be
extended by the President-

(a)      for a period of one year and thereafter for another period of one year com-
mencing from the end of the first period of extension; or

(b)       for one period of two years.

So the maximum period for pioneer status is 5 years. Again, nothing controversial here. Let’s skip some more legal jargon and go to Section 16 to see what exactly this pioneer status does for a company:

16. Profits exempted from income tax

(1) Subject to the provisions of subsection (2) of this section and section 17 (6) of
this Act, where in the application of Parts IX and X of the principal Act, a statement is-
sued under section 14 (4) of this Act has become final and conclusive, any profits shown
by that statement shall not form part of the assessable profits or total profits of the pion-
eer company for any year of assessment and shall be exempt from tax under the principal

(2) The Board may, in relation to any statement issued under section 14 (4) of this
Act, declare that the whole or a specified part of the profits is not in dispute, and any such
undisputed profits shall be exempt from tax under the principal Act pending the statement
becoming final and conclusive.

I highlighted the section above for emphasis. Once you have been granted pioneer status, after fulfilling the necessary conditions, you don’t pay any taxes on the profits you make in the 5 year period of the pioneer status (assuming the initial 3 years is extended). The best example of a company using this pioneer tax status is perhaps Dangote Cement:

Screen Shot 2014-06-21 at 13.57.35

Looking at the numbers above (page 3 of the Dangote accounts) you see that rather than pay any taxes, the company actually got a tax credit as a result of the new cement plants like Obajana that it built. This is how the system works. In the case of Dangote, we know for a fact that cement production in Nigeria has increased as a result of his investments and he has built new plants that weren’t there previously.

For a quick primer on the IDA, click here (PDF).


Which brings me to the purpose of this post. Seplat was in the news recently when it raised $500m on the London and Lagos Stock Exchanges. It’s one of, if not the most, successful beneficiaries of Nigeria’s Local Content Act which has been transferring assets in the oil industry to Nigerians to allow them participate and grow their skills.

Seplat acquired 45% of 3 oil-producing assets from Shell and Agip namely OMLs 4, 31 and 41 in July 2010 when they were producing around 18,000bpd. My rudimentary knowledge of the O&G industry tells me that the difference between an OPL (where the P is for Prospecting) and an OML (where the M is for Mining) is that an OML is one that is already producing oil i.e. all the exploration and investment has been done and the oil is already coming out of the ground. In other words, buying an OML is like buying a shoe that comes with socks inside it, if you like. An OPL on the other hand has not produced any oil but it is a given that there is oil in the asset i.e. plenty of investment is required to get the oil flowing.

I’m told, reliably, that not only did Seplat buy the OMLs, it even ‘bought’ Shell staff as part of the deal. That is to say, it was handed the keys to the working asset along with people who had experience operating it. This is not to say that Seplat has not done anything since purchasing the assets – it has increased production in the fields mainly by boosting community relations which in turn has greatly reduced the piracy challenges that Shell was finding difficult to manage in those sites.


Having said all that, let’s go to page 28 of the investment prospectus the company released to investors when it was preparing for its IPO:

Screen Shot 2014-06-21 at 14.24.28 This is very interesting to say the least. Upon acquiring these assets, Seplat somehow obtained pioneer status on them. Think back to the spirit of the act above on how a company gets pioneer status and then apply to that a company buying working assets and simply continuing a business that was already in operation. How exactly does this work? As you can see from the extract above, the company is exempted from every possible tax it would normally be liable for.

Indeed we can see the effect in the company’s 2013 accounts (page 18):

Screen Shot 2014-06-21 at 14.37.27

From 2012 to 2013, profits increased by 45%. In 2012, the Nigerian government collected taxes on these assets to the tune of $95m. By 2013, these same assets that generated tax for the government had somehow become ‘pioneer’ and ended up paying a big fat zero in taxes. Zilch.


What is going on here? I have no idea, but maybe you do. It is indeed difficult to understand how an extant company that was previously paying taxes to the government somehow ‘transformed’ into a pioneer company that pays no taxes.

Tax To GDP Ratio

Why does all this matter? Well, one consequence of rebasing our GDP to $510bn is that it has exposed how little the government is collecting in taxes as a share of GDP. Indeed, the Finance Minister said it in April that this percentage – tax to GDP – declined from 22% to 12% following the rebasing:

But now with this recalculation, our revenue to GDP ratio is 12 per cent and our non-oil revenue ratio to GDP is four per cent, which means that we live worse than before.

“As you know, our revenue ratio to GDP before was 20 per cent, just about in the middle of the emerging market economy, not as good as the 22 per cent that we want to be.

“For tax revenue to GDP, we now have to redouble our efforts to get back to the 20 per cent ratio at least to where we were before,” she said.

What this means is that there is a lot more tax out there to be collected which is a no brainer given the amount of work that needs to be done in Nigeria in all spheres of our development. If you’ve been following the news recently, you will have noticed that every other day the Federal Inland Revenue Service (FIRS) is embarking on one ‘crackdown’ or the other in the name of boosting the government’s tax collection. A random example from last week was when the FIRS carried out ‘enforcement activities‘ against NICON Hotel and NICON Insurance over the companies’ failure to pay N90m it owed in taxes. In the days and months ahead, we are going to be seeing more of such ‘crackdowns’ especially because the Nigerian government has only managed one surplus in the last 13 months – everything it earns, it spends and then borrows more. The deficit – the extra the government had to borrow on top of what it earned – for the first 4 months of the year alone stood at N430bn. The tax forgone from Seplat is at least N15bn (assuming it paid the same tax for 2013 as it did in 2013).


Who pays the taxes around here? Is it the little guy who gets harassed by FIRS and has his business shut down for not paying a couple of millions? I haven’t bothered to check any of the other local content guys but I am almost certain that I will find the same arrangement there. The pioneer status is now evidently meaningless and is something that can be obtained by interpreting the laws very loosely. As I said earlier, I have no problem with anyone not paying taxes as long as the option is available to everybody and not just some connected people. Can we all be pioneers and not pay any taxes? If that’s the case, sign me up!

This is just one aspect of the byzantine laws that are so easily abused in Nigeria. There are waivers and there are concessions that have been abused in the past. All these things increase the government’s desperation for revenues and that in turn contributes to the harsh business environment of Nigeria where all sorts of government agencies turn themselves to parasites on small businesses with all sorts of taxes and levies.

But maybe this is all fine and Seplat is indeed a pioneer company? So what have I missed?


*P.S Thank you to the person who helped me with information in writing this post. You know yourself.



Someone sent me some interesting comments but wants to remain anonymous. They raise some very interesting points I missed out.

I wanted to fill you in on some areas that you may find interesting:

1. The IDA which you referred to, is actually a subsidiary legislation to the Companies Income Tax (CIT) Act.  It makes several references to “The Principal Act” which it then defines as the CIT Act. So technically, the tax exemptions in the IDA only relates to companies liable to CIT, rather than Petroleum Profits Tax (PPT).  Also, the powers granted to the President or Executive Council to exempt companies from tax (which is what the IDA was enacted to accomplish) is in line with Section 23(2) of the CIT Act.  No such powers are given under the PPT Act.

2. So why does a company taxed under the PPT Act enjoy Pioneer Status from the IDA (a CITA subsidiary legislation)?  Well strictly speaking, it shouldn’t, based on the above point.  And this was the FIRS’ position on the matter until sometime last year, as far as I know.  What changed?  It received a directive from the Presidency that it should honour the Pioneer Certificate issued to oil and gas companies by the NIPC.

3. I must say that there are arguments that could be made for the NIPC to grant a pioneer certificate to an O&G company (I must admit they are not water tight).  For instance:

  • The original pioneer list provided in the IDA can be expanded by the Executive Council.  The powers of the Council in the IDA has been granted to NIPC (See Sections 22 and 23 of the NIPC Act).
  • The NIPC a long time ago (nobody knows exactly when) expanded the pioneer list to include “Mineral Oil Prospecting and Production” and “Petroleum” as pioneer industry and pioneer product respectively.  You can find a full list on the NIPC website.
  • The presidential directive may have legislative backing.  Section 51(1) of the FIRS Establishment Act subjects the FIRS to the general direction of the Minister of Finance.  The provisions of this Act takes precedence over those of the PPTA (which has no provisions of tax exemption powers, like I mentioned in 1 above).
  • A Pioneer Status Incentive (PSI) Regulation was issued in January 2014 by the NIPC.  It provides that an applicant must have incurred a capital expenditure of N10million (small change abi?).

4. You missed out on something interesting, which adds to the question on how an extant company suddenly becomes a pioneer one.  The PSI Regulation also provides that an application must be submitted within one year of the applicant’s commencement of commercial production.  The IDA (Section 6(1)) also has something similar.  You would think that this should fall within a commencement years of the business.  However, the NIPC, in practice, gives a discretionary waiver of the timeline for this application.  Therefore, whenever you apply, you may get it. And the tax relief period will commence on the date of the Production Day certified by the Federal Ministry of Industry, Trade and Investment.

5. From what I know, Seplat was one of the O&G companies to obtain pioneer status only recently.  A few others have obtained same in the past. I know one that has even come out of its 5 year pioneer period. Seplat most likely needed it to make their prospectus smell a lot nicer.  So they joined the band wagon.  I guess their case is more popular because they went public.

6. Finally, there are strong rumours that the Government is reviewing its policy on granting pioneer status to indigenous O&G companies, as it is causing a serious decline in revenue from PPT.  You mentioned that Seplat’s pioneer period commenced on 1 January 2013. Isn’t it odd that it commenced last year when they only obtained the certificate this year?  As you may be aware, PPT is paid in installments in advance, so it already paid a significant amount of its 2013 tax.  Now they are requesting a refund.  They might just be the harbinger of a policy reversal.

Guest Post: The Word On The Streets XII: The Luanda Edition

A friend of mine recently spent a few weeks in Angola. He then reached out to me to do a TWOTS type guest post for the blog (previous editions here). The imitation flattered me and the education is most welcome. I have to say that my record of travel in Africa is really terrible – I have visited more of Asia even. Hopefully that changes soon.

Enjoy the piece (he wants to remain anonymous) 

So my job takes me very exotic destinations. In the past 18 months, I have been to the vacation destinations that are N’djamena (Chad), Douala (Cameroon), Addis Ababa (Ethiopia), Malabo (Equatorial Guinea) and most recently Luanda in Angola. I must admit with shame that prior to these trips, I had never gone to any African country, not even Benin Republic.

Anyways, this article is just a summary of what I noted on my recently concluded trip to Luanda in Angola.

1. If you think getting a UK, US or even Nigerian visa is difficult, then you haven’t applied for an Angolan visa. I started the process in Feb 2014, with a Letter of Introduction from my company in Angola (duly signed by the Ministries of Petroleum and Export). It took 6 weeks.

2. Application for visa is another kettle of fish. I processed visa for 3 weeks and at the point of stamping, I learnt I needed a new LOI because of some administrative reason. Cue another 2-month wait. In all, the process took 4 months. My passport was stuck in the embassy for 2 months

3. Ethiopia is doing what any sensible government should do. They have made Addis Ababa a hub for travel in Africa. Very simple concept. Make people sleep overnight. Every night, hotels, restaurants, clubs and the likes in Addis make money from transit visitors. It is a win-win situation for them. The people come in; spend money overnight, thereby boosting an economy that has no major natural resource. I guess necessity is really the mother of invention. Of course, entry into Ethiopia is probably the easiest in Africa.

4. Entry into Angola is the third part of the hydra headed monster. First time entrants are kept in a waiting room for hours, while a Letter of Guarantee by your host is processed. Grapevine states that if you know your way, you wont have to wait (more on that later). I was lucky in that my company had just had an agreement with the government for free passage for us, so no waiting room. My colleagues had spent 3 – 6 hours there on prior trips. One fellow Nigeria expat lady spent 9 hours!!!

5. Nigerians are everywhere. Word on the street is that our Igbo brothers control the spare parts market in Angola (as they do in Malabo). How do they get visas you ask? Well, the grapevine says that for a specific amount of money, you can get an original Angolan visa. All you need to learn is how to speak Portuguese. Also, if you are caught as an illegal immigrant, your freedom is available for $2,000. See evidence of our Igbo brothers in the picture below:

Luanda 1


6. Oh yeah. Angola is the most expensive city in the world, which is why the $2000 bribe is not ridiculous here. A minor misdemeanor like not going out with your passport on a night is usually settled for $300! I experienced Angola’s expensiveness first hand. Bought a N50 padlock (see picture below) for 500 Kwanza ($5). Also, needed to shave, it cost $7. A full haircut is $30! An average meal in a restaurant costs $100/head. A take out meal is about $40. Cars are sold at double the value you can obtain in the US. Hotels start from $700/night.

Luanda 2


7. Rental prices are another kettle of fish.  The high rent here suffers from two causative factors in my opinion: one: traffic and general Angolan expensiveness.

8. Luanda has a BIG traffic problem. The roads to the city are narrow; they are usually 2 lanes. Additionally, Angolan houses do not have car parks so they park on the road, meaning that the major highway is effectively one lane. A 6-mile journey from the Guest House I stayed in to the office is 1hr to and 1.5hrs fro. And that’s because we leave at 6am for work and leave work at 4pm. The ironic thing is that Luanda is surrounded by water and you would imagine that ferries will be used more than cars. However, I found out that there are less than 5 large commercial ferries to town. Typical Luanda road below:

Luanda 3


9. Funny enough, for a city with that much traffic, the roads are sane. No horns blaring, drivers very considerate, even zebra crossings are obeyed. I think this stems from the easygoing nature of most Angolans. They know things are not perfect but as all of them still have vivid recollections of the war, they know how to take life easy. No hurrying for Angolans, every one does stuff at their own pace. They love living life to the fullest; flashy cars, designer wares, very fitness conscious and yeah, they are very blasé about sex, single parenthood and the likes. It is not a big deal here.

10. For a country that just came out of a civil war, Angolans are very nice. I have never seen a collection of people who will go out of their way to make a foreigner comfortable. Everywhere you go, people have a smile for you! I experienced random acts of kindness and courtesy I normally would not expect from people speaking a different language.  I went for dinner one evening and Isabel dos Santos was on the table next to me, absolutely no airs. However, I was told that plain-clothes security men surrounded the place.

11. Angola can be called the most expensive slum in the world. Their favelas are extra dirty as shown in the picture below. Even the $5k flats are very dirty. The houses are very old, drainages are not cleared, people living and laughing in absolute squalor. Not unlike Nigeria. However, even in these slums, I noted that there was power every time I passed and that Angolans love air conditioning and DSTV.


Luanda 4 Luanda 5 Luanda 6

12. Angolans still have a close affinity to Portugal and as a result, among the working class people, you have a lot of mixed race people. Their ladies are extremely beautiful and ‘endowed’. The men; very fit and tattooed. They all have the mentality of an average European and sure know how to have fun. However, vex them and they let you know they are African. One of my mixed race friends told me that I should be careful or “she will get her voodoo doll out for me”. I backed off immediately.

13. Back to rent, if you live in Nigeria and have a spare 1.5M USD, buy a flat in Angola. My colleague bought one around the office and receives US$15k rent per month. The building in the next picture is $5k per month. Due to the traffic, there is very high demand for flats in and around the city center (which the government has mandated all companies to operate from). This high demand, coupled with the general high cost of living in Luanda, makes rent very very high.

Luanda 7

Luanda 8

14. Final word on Angola – my impression is that this is a country struggling to understand the enormity of oil resources they have, so soon after a long war. ‘Anyhowness’ is here too, not on our scale though. The people are much nicer but you need a lot of money to survive here.

P.S: What happened to the renovation works at MMIA. Came in on a rainy day. Noticed the roof was leaking, the ACs and lights they just bought do not work and the arrival hall stinks. Can we actually get anything right?






Guest Post 2: The Case FOR Sanusi Lamido As Emir of Kano

So yesterday, you read the case AGAINST SLS as Emir of Kano. Yes, I know you read it because it is now the most popular blog post on this blog after 6 years. 

I have to thank my writers – they did this at very short notice and managed to deliver clarity on an issue that carries a lot of emotions around it. Na gode.

So here’s the case FOR SLS as Emir. Enjoy and I hope for us non-northerners, we have been educated on northern Nigeria




On Sunday the 8th of June, former Central Bank Governor, Sanusi Lamido Sanusi (SLS), was announced as the 57th Emir of Kano, succeeding the revered late Ado Bayero. Like most people, I was shocked but pleasantly surprised at his selection, as just hours earlier ‘official’ congratulatory messages had publicly been extended to the late Emir’s eldest son, thereby unofficially confirming Sanusi Ado Bayero as the new Emir. It turned out that the premature felicitations were an “error” and that deliberations were till underway to choose from a list of three nominees: Sanusi Lamido Sanusi (the Dan Maje), Sanusi Ado Bayero (Ciroma) and Abbas Sanusi (Wambai). The nominees were screened and compiled by four (4) kingmakers after a careful assessment, as has been the tradition for centuries.

Sanusi Lamido Sanusi having built a successful banking professional career outside the emirate needs no introduction here other than to say he has publicly stated his desire to be emir, and is tagged as polarising due to his penchant for speaking his mind and sticking to his convictions, qualities that depending on who you ask are either virtues or vices for an Emir. But more on this later.

Sanusi Ado Bayero, a lawyer, is a career royalist and has reportedly been groomed to succeed his father. He is perceived as reserved and was known to be close to his father, the late Emir. As a result, people’s affection towards Ado Bayero is projected on him.

Abbas Sanusi, SLS’ uncle, is the oldest surviving son of the late powerful Emir Sanusi I (SLS’ grandfather). He has for decades been the strongest member of the Kano Emirate Council and was rumoured to have colluded with Abacha to depose late Ado Bayero and have himself enthroned. So his ambition is well-known.

The kingmakers certified all three eligible, having met all criteria; the most important of which being they’re all descended from Emirs. All nominees are of Abdullahi Bayero’s lineage – the father of late Ado Bayero and Emir Sanusi I. (Emir Sanusi, the eldest son and successor of Abdullahi Bayero decided not to use Bayero for reasons not known). It would then appear that no choice would be a wrong one. Far from it!

Immediately after the announcement of SLS, pockets of protest around the seat of the emirate centred within the ancient walled city of Kano, which now constitutes 4 of Kano’s 44 LGAs, erupted. Now, this is to be expected considering the late Emir was so loved and ruled for 51 years, a period in which almost 80% of present Kano population either came of age or were born. Most have either never experienced or do not have a conscious memory of the death of an emir and the succession power tussle that follows; people did not know how to react. A contributing factor to this confusion is the royal tradition of immediate succession, which doesn’t allow a lot of time for people to grieve. This makes it difficult to differentiate between grief over the loss of revered Emirs and dissatisfaction over succession issues. In reality, these are entirely different things. But the system is what it is and people have a right to be sentimental up to the point that they do not try to change facts or fabricate information.

When opposition to SLS persisted beyond certain constituencies and into what I considered saner climes, I decided to sample opinions and let myself be convinced. After all, I thought, since the choice has been made and in my eyes no rules were broken, the onus is on the “bamayis” to convince me of Sanusi’s unsuitability. I only had one condition: I will accept “I just don’t like him” but all other arguments must pass the common sense test. Easy right?

After speaking to a number of people, most of whom were quite adamant that the decision be reversed, I found an overwhelming consensus among dissenters. The kind of consensus that makes you wonder if they were indoctrinated into rejecting the new Emir, for the arguments were illogical, mostly emotional and monumentally ironic (if they were songs they would be sung by Alanis Morissette!). I address the main ones below.

1SLS’ selection is somehow a betrayal/disrespect of the memory of late Ado Bayero – The biggest irony of this argument is that it is mostly made by people who think the Emirate is still very influential, relevant and can play a vital role in society. Yet, they advocate a selection process that makes being the son of late Ado Bayero the deciding factor, disregarding all other considerations. The memory of late Ado Bayero is beyond desecration. Such is his mark on history. His family will rightly be transferred all the reverence and respect he has earned throughout his legendary reign but not subjects. Subjects aren’t transferred by fiat. Within the confines of royal tradition, subjects are only transferable through the process of succession, following the selection of a new Emir from ALL the eligible candidates. Reducing honouring late Ado Bayero to ensuring his son succeeds him when father-son succession isn’t one of the conditions minimises his legacy. This argument is more emotional than the rest and, I suspect, is rooted in an inability to separate grieving the loss of a great man from dealing with the inevitability of the change that will follow a long and remarkable reign. Considering its emotional nature, this view may be very temporary.

2. SLS’ name was ‘sneaked’ onto the list – This is perhaps the most illogical argument of all. I think it’s partly based on perceptions that SLS’ claim is not legitimate simply because most are too far removed from his grand father’s reign. They neither remember nor care that his father, a crown prince (Ciroma, ironically the same title as Sanusi Ado Bayero), was also set to succeed his father only to be bypassed for late Ado Bayero via Muhammadu Inuwa after Emir Sanusi I was deposed. To think that the grandson of an Emir, son of a crown prince, and most accomplished member of the royal family who was raised by and married to the daughter of late Ado Bayero would not make a list of contenders is just incredible. According to this story, the new Emir did not make the 1st draft but was sneaked in at the behest of Kwankwaso, who reportedly told the kingmakers to show respect for Emir Sanusi I’s lineage by including SLS on the list. Never mind that one of the kingmakers, Muhtar Adnan, the father of former finance minister and current World Bank ED, Dr Mansur Mukhtar, was involved in the selection of 3 emirs (counting SLS) and is beyond intimidation at this stage of his life. Never mind that Kwankwaso in the presence of all the kingmakers and the media said SLS was not just on the list but his name was first. Never mind that none of the kingmakers showed any sign of disagreement with the governor!

The fact is late Ado Bayero’s uncommon humility and patience has covered up a lot of the deficiencies of typical royal behaviour. It is easy to forget that royals are very proud, sometimes arrogant people who would not be coerced.

But let’s even entertain the idea that these kingmakers who come from an era where the emirate had executive and judicial powers have somehow been coerced into submission by this nobody from Madobi (Consistent with the mindset of all royals the world over, the Kano royal also thinks there are only two classes – royals and masses. And that includes the governor!). And let’s, for a moment, entertain the notion that SLS’ name made the list just to appease the Sanusi lineage and that Kwankwaso and the kingmakers lied to the world. Why were there then 2 names (out of 3) from this lineage – Abbas Sanusi and SLS? Did things suddenly change from appeasing Sanusi’s lineage to disrespecting Ado Bayero’s?

3. Kwankwaso has politicised the Emirate – This argument would have made sense if the new Emir didn’t have a legitimate claim or if any succession rules were broken. Father-son succession has never been automatic (in the last century only SLS’ grandfather, Emir Sanusi I, directly succeeded his father) and is currently not a condition. The fact that SLS made a list of suitable candidates chosen by the custodians of the process (kingmakers, who, by the way, aren’t getting any bad rap for this) is good enough for me.

Politics may have played a role in SLS’ emergence but it has done so for almost a century. It was politics that led to the dethronement of Emir Sanusi by Sardauna of Sokoto, Sir Ahmadu Bello; it was politics that led to the transfer of the throne to his uncle, an already aged Muhammadu Inuwa; it was politics that led to the ascension of a young Ado Bayero who the Sardauna felt at the time shared his vision for an upcoming northern Nigeria. You could say Sardauna thought late Ado Bayero a progressive at the time. Again, the irony!

If politics played a part here it did no more than it has done in the past and it is not the only motivation. This decision is too expensive and politically unrewarding for Kwankwaso to make solely for political reasons. Consider this: if SLS’ selection is entirely political and since politicians make decisions for political gains, how can SLS repay Kwankwaso? SLS isn’t overwhelmingly popular in a way that can favour the APC, at least not in the short-term – before 2015, Kwankwaso’s time of need. Moreover, SLS’ propensity to be fiercely independent makes him a very risky political bet. It’s not like Kwankwaso can remove him or wait for his tenure as Emir to expire if his requests are denied. Why then would Kwankwaso risk it all if he did not believe SLS to be the better man?

4. SLS is elitist, capitalist and too ‘hip’ - SLS’ support for subsidy removal earned him a dan jari hujja (capitalist) tag in Kano. That the nation’s top banker responsible for economic decisions would be expected to do anything else is baffling. To point out that his support for subsidy removal was purely professional is to state the obvious. But more importantly, the Emirate is not getting SLS the economist or the CBN Governor the same way it didn’t get Ado Bayero the policeman or the diplomat. What ‘capitalism’ will manifest as in an Emir will likely be a determination to eradicate endemic laziness, support community and human development projects, etc. – a determination to not just be for the talaka but to reduce the number of talakawa. I am not sure these are bad things.

Some say he is too loud and ‘hip’ for Emirship in an attempt to stereotype him as an outsider for daring to excel outside the royal family. This might carry a bit of weight if not for this bit of irony: the late Ado Bayero was also ‘hip’ at  the  time of his ascension. He was an established professional outside the emirate in the same way we consider SLS an outsider today. He was the 11th son of Abdullahi Bayero and figured, with the odds not in his favour, he should have  a life outside the emirate. But being emir was his destiny even though at the time Ciroma (SLS’ father) and oldest son of Emir Sanusi who had just been deposed 3 months earlier was considered an ‘insider’.

5Bringing the Emirate into disrepute – This is the most baseless argument of all. The notion that the enthronement of SLS somehow risks the reputation of the emirate as a traditional institution and custodian of culture is just absurd. Simply remembering that he is by acclamation an Islamic scholar and a man of proven integrity who spent his formative years in the traditions of the institution under the tutelage of late Ado Bayero disabuses one of that notion. This is one of those arguments I simply can’t imagine anyone that considers SLS a legitimate contender and grandson of Emir Sanusi I would make. With this particular set, there is no reasoning. If SLS does not add to the prestige of Kano Emirate I can’t fathom how he will take away.

6. He’s not the people’s choice – Reports that SLS is not popular should be taken with a grain of salt. While it’s true that there have been protests, these have emanated from expected areas, specifically the 6 LGAs closest to the seat of power where the late Emirs sons are district heads. With or without the princes’ approval, their supporters can decide to protest against the new Emir’s emergence. It’s noteworthy that there are 38 other LGAs with large populations as Kano has one of the largest rural populations in Nigeria. And considering the fact that Kano’s rural and urban political dynamics usually run counter to each other, it is reasonable to expect SLS is popular outside the metropolis. This is not to say that SLS isn’t unpopular in some quarters or that he is the most popular among the contenders. But new Emirs seldom are. Reaction towards them generally tends to range from indifferent, to mixed to negative. Overwhelming popularity is earned and SLS will have every opportunity to earn it. Popularity during the selection of an Emir, in as much as the choice is not overwhelmingly rejected due to glaring deficiencies/personal failings (in which case the contender will fail other conditions anyway), is irrelevant. Prospective Emirs only need be popular enough for the Kingmakers. Competence, experience, education and lineage are the decisive conditions for selection and SLS emerged having scored better than other contenders.


There are a lot more fringe anti-SLS arguments making the rounds but the 6 outlined above make up the overwhelming majority of the ‘grievances’. Most of the arguments have nothing to do with SLS’ merits, and the very few that do are based on fabrications, misconceptions or unverified information. They are illogical, arbitrary arguments by a section of the population that has decided for itself who it wants as its Emir and would not be convinced otherwise. While a part of this rejection stems from not knowing how to react to the first succession in the lifetimes of many, some of it is due to a misplaced sense of loyalty, the feeling that support for SLS is a betrayal of the legacy and memory of late Ado Bayero. It doesn’t matter that SLS has a claim or that he is at least equally qualified. It doesn’t matter that, considering the dire challenges facing northern Nigeria, selecting a new Emir is too critical a decision to be based entirely on sentimentality.

To argue that the throne should be left with late Ado Bayero’s family just out of respect for his legacy is to diminish his sons as individuals by denying them the dignity of being assessed on their own merits; it is to diminish the throne by dismissing and undermining the important role it has the potential to play in the lives of people in an increasingly insecure and underdeveloped north that requires cultural, traditional and religious leadership now more than ever.

I am happy SLS emerged but had Ciroma been chosen I would still have supported him without hesitation realising that I’m helpless in this matter – public opinion has never swayed a royal succession. It is not a democratic process. It is rather a traditional process that selects based on criteria that at any point in time multiple individuals will satisfy. To claim that selections aren’t subjective is to be naïve. Choosing Emirs has always been ‘hit or miss’ considering the small sample size and the handful of people who get to decide. But it what it is. So, unless the rules change, if you don’t complain when you get your preferred choice, you shouldn’t when you don’t. This realisation makes me even more grateful to Kwankwaso and the kingmakers for making what is in my opinion (and I’m open to being convinced) the right decision perfectly in accordance with the rules as they stand.

My support for SLS came instinctively and the reasons are straightforward: The Emir of Kano has control and influence over a massively influential traditional network that is severely underutilised at the moment. Though ceremonial, the emir’s words can sway public opinion and have profound effects on a wide range of things, from affecting the success of projects like vaccination programs, to galvanising support for human and community development initiatives, to attracting international aid and investment. A progressive Emir like SLS can overhaul this traditional structure and unlock its potential as an effective outreach network that can be used to address some of the pressing challenges facing the state and region. Given he has been successful in everything he has tried his hands on, I have no reason to believe he will fail.

Of course SLS is not perfect. I do worry there might initially be moments of minor embarrassment, particularly regarding his proclivity to be argumentative and blunt but I believe the emirate will tame him and he will learn to control the urge to the ‘rightest’ man in the room (In most cases this wouldn’t be a problem since he will be spending a lot of time in the palace where he will be so bored he would wish someone would challenge him). On a more serious note, the emirate council has a strong precedent of taming Emirs. An emir is as likely to effect radical changes in traditional royal affairs as the POTUS is likely to alter US defence policy working with an opposition congress. It is a very conservative culture – this is why I think that “bringing the emirate into disrepute” argument is pure BS. All in all, I think he will make a great Emir; his positives by far outweigh his negatives, and, crucially, his personality and experience are just the set of qualities needed right now.

The people of Kano are very passionate and emotional. Nothing proves this better than the drastic about-turn to support SLS by a significant number of royals, religious leaders and the general public over the past 24 hours, suddenly realising that he is zabin Allah (God’s choice). It is only a matter of time; Kano will eventually come around and fully support its Emir. Sometimes, in a state of emotion, logic takes a back seat, but eventually, when passions dissipate, common sense prevails.

May His Royal Highness Emir Sanusi II have a long and prosperous reign, may he strive to attain the lofty ideals of the great late Ado Bayero and Emir Sanusi I, and may he be guided rightly.