1. Getting ready to board in London, I walked past someone who looked familiar. Looked back and this time I recognized it was Governor Peter Obi of Anambra dressed very casually in jeans and a jacket over a simple shirt. Went to say hello and tried to make small talk before the people in 1st Class were called to board.

We got to Lagos and when I got to baggage claim, I saw him pulling off one of his boxes from the conveyor belt. All the while he was waiting for his other bag (I left him there as his second bag didn’t come out in time), he stood there gisting with other passengers and even collecting phone numbers and business cards from seemingly random people.

Of course, this is not why we are here. You can ask the French how they are faring after they elected a guy who campaigned as ‘Mr Normal’ last year. But in Nigeria, abnormality is so rampant that the people who act ‘normally’ end up looking like the crazy ones. Well done to the Governor for carrying his own bags.

2. Overheard: “We (the army) were asking GEJ for funding to increase numbers and efficiency. Only for the guy to turn around and create a battalion to guard himself”

3. I don’t want to come across as insensitive about this and it’s important to know that 99% of Nigerians won’t share my opinion on this, but I found internet access to be a bigger headache than electricity. Every morning, I try to do a newspaper review through my twitter handle. The idea is to pick out like 10 (mainly business) stories and tweet the links with a short smarty pants comment. It’s rather amusing that I couldn’t do this review of Nigerian newspapers because I was in Nigeria.

I was on the receiving end of some incredibly useless service from MTN. It’s one thing to see Nigerians complain about poor service from the company but to actually experience it was painful. For example, when I was last in Nigeria in August 2012, I spent 3 days so I just set up my email on my blackberry using the BISWEEK plan (one week blackberry internet service). Worked without any problems and I was at least able to use emails very well. So this time around I did the same BISWEEK plan and set up my email as usual. The emails started coming in as expected. But I then tried to reply an email and got a message saying I couldn’t do this because ‘my plan wasn’t set up to reply to emails’. What kind of monumental idiot comes up with stuff like this? It’s not enough that you charge me for 1 week access, you want me to either pay or jump through another hoop for the privilege of being able to reply to the emails you allow me receive?

Things are hard in Nigeria and people will do well to heed the maxim – First, do no harm. Because it seems that where things are already difficult and stressful to use, some sadists relentlessly come up with ways to make them even harder. MTN did not also bother to tell me how exactly to go about entering into this privileged place where I would be able to reply to my emails. So I was restricted to responding to emails by going via the web. I do not have the words to describe how painful this was. I saw so many different error messages driven by internet access on my phone…I didn’t even know such messages exist.

How about holding a conversation with someone? I was in traffic trying to firm up details with someone for a meeting. To make sure we coordinated time and location, we were chatting on BBM and WhatsApp at the same time. Once I send a message via BBM and it ‘hangs’, I switch to WhatsApp until that one also seized up and then I switched back to BBM. Ad infinitum. World without end. Etcetera etcetera.

4. The experience at the ‘International’ airport also follows the policy of making life as hard as possible for Nigerians. By the time I was being ‘checked’ for the 5th or 6th time just before boarding the plane, I lost my rag and gave the hapless guys rifling through my hand luggage and pledging their ‘loyalty’ a handful. What exactly is the thing they are looking for? You frisk me thrice and check my bag endlessly. You collect my passport 3 different times and take the details in it. You rifle through my bag while looking at me and asking me to do weekend for you. It really is a frustrating experience especially because the airport is quite small so the efficient thing to do is to get people in and out of the place as quickly as possible.

And this time around, I observed how begging has become such a massive industry in Nigeria. The professional beggers at the wedding in Ibadan were particularly impressive. A friend came to see me there and as I was walking her to her car, they began to hail her and mentioned a name I didn’t recognize. She then told me that the name they mentioned was that of her friend with whom she had attended a burial party 2 days before. Just in case she had forgotten, they seemed to be reminding her. A bit scary on some levels.

5. Almost a month ago now, my twitter feed was taken over by lots of my friends mourning the news of Efere Ozako’s death. Shamefully, I had never even heard of his name before that day but it soon became one of those situations where every one of your friends knew the guy except you. Not a single person I knew had an unkind word to say about him and the feeling of loss among those who knew him seemed genuine. He was apparently a larger than life lawyer in Nigeria’s entertainment scene.

I got to Lagos and was speaking to my young lawyer cousin and it turns out she used to work for Efere Ozako’s firm. Now, I hesitate to pass any kind of judgement on someone who I never even knew but this is the point I want to make – immediately after he died, all the 8 lawyers and 5 support staff in his firm were asked to leave. Basically, the business shut down immediately and that’s that about it really. He was a young guy and was running about 3 businesses at the same time; it is possible the stress contributed to his death. Again, this is me speculating and I stress that I am not trying to be insensitive. I listened to my cousin shake her head ruefully at the many dreams that the guy had and how they may have all died with him.

My dearest Nigerian entrepreneurs trying to make an honest living in a country that shows you no love; you know I love y’all from the bottom of my heart. I know the hustle is incredibly real too. But you have to remain alive for any of it to make any sense in the long run. I remember interviewing Ndidi Nwuneli of LEAP at TEDxEuston last December and she could hardly complete 2 sentences without dropping the words ‘succession planning’. She’s big on it and she told me with pride how she no longer runs LEAP because she’s been able to find people and processes that make it possible for her to focus her energies elsewhere.

I had a chat with a businessman who runs 5 businesses. I know he’s had a particular Indian guy working for him for about 6 years in his first company. When he told me how much he pays the guy (millions per month) my jaw fell on the floor. It sounded like oil and gas money and yet this businessman was willing to pay such sums. He told me that, paying that money is what allows him to be able to run 5 different businesses with a laptop from his living room. He has not had cause to visit that particular office in about 5 years and he has now made this particular guy a part owner in the business.

The issue of death remains a ‘God forbid’ topic in Nigeria but if you run a business and have people relying on you for their livelihood, it’s time to turn your work into an institution.

6. I landed in Lagos and almost immediately headed over to Channels Television Station to spar with Ebuka Obi-Uchendu on Rubbin’ Minds. Never done live TV before so I was racked with nerves as soon as I stepped inside the studio. But good fun it was. The TV station is now somewhere off the Lagos – Ibadan expressway and I couldn’t help wondering – how do they get people to come here for SunriseDaily which starts at 7am?

The good people at Africa Practice also invited me to speak at a one day seminar for bloggers and aspiring bloggers. I hope the people I spoke to found it useful but it was one of the most enjoyable things I’ve done with an hour lately. I would have shared my slides but they won’t make sense as I merely used them as a guide. Props to the guys who work there; they came across as a really smart, knowledgeable and fun bunch.

Incredibly, they also paid me for my talk. I would have been happy to pay them to do the talk even and no one’s ever offered to pay me for anything before so this was uncharted territory for me J

7. “The other day I was going to cut my hair. I got to my barber and saw everywhere was dark. I assumed they had shut so started walking back to my car when someone ran out from inside the darkness and said ‘Oga we dey here o….we off gen to save petrol’”

It’s hard to calculate the damage the epileptic power situation is doing to small businesses in Nigeria but the above, narrated by a friend of mine, is an illustration of the kind of choices people have to make. The barbing salon will lose business from people who simply drive past thinking they are shut but the owner has surely tried the other method of leaving the lights on before and probably worked out the cost exceeds the extra custom he might get.

It’s a very harsh environment in which to do business.

8. This harsh environment is perhaps what causes the staff at Iya Pelumi (besides Sheraton Four Points Hotel in Lekki) and Iya Eba (Beckley Street in Lagos) to go out of their way to be rude to their customers. Halfway through fulfilling my order at Iya Pelumi (5 Ogufes and 5 Ponmos), the girl got upset and simply stopped selling. The queue was long and the place was blazing hot. Pragmatism took over and I resorted to massaging the girl’s ego so she could serve me and let me out of there.

Over at Iya Eba, a friend joined me briefly and simply had a bottle of malt to drink. Some water spilled on the table in front of him so he reached for the serviette to wipe it. The lady considered this to be a mortal sin and loudly made him know that merely drinking a bottle of malt did not entitle him to serviette usage – ahn ahn Broda, e jeun rara e de fe ma ko serviette?

Of course when we were leaving she smiled and wondered how we dared to ask for our change. We obliged and let her keep it. And all was well with the world again. Oh, at Iya Pelumi I also tipped the girl after she calmed down and completed my order (I only got 2 ponmos because while she was dithering, someone else had sold all the ponmo to another waiting customer). It is possible that bad customer service is part of the ‘experience’ being sold in these places.

I have also wondered how a single lady might break into the bukateria business. You clearly have to be Iya Something to be taken seriously (Technically, Iya Aje is childless but the word on the streets is that she killed her children and used them for whatever it is that makes her food to sell so well). We might need legislation to smash the ‘married with children’ cabal controlling this sector of our economy.

In unrelated news, I am told that a group of Americans have conducted a price discrimination experiment on how rents are determined in Lagos. As a result they have been able to work out the premium that wearing a suit to go and view a property will add to the rent you are quoted. I am told that the results they found were uncanny to say the least.

Once it is made public, I will share it if I have it.

9. One of the best examples of the use of ‘but’ in a sentence for me is in the book of 2 Kings Chapter 5 verse 1 which introduces us to Namaan:

Now Naaman, captain of the host of the king of Syria, was a great man with his master, and honourable, because by him the Lord had given deliverance unto Syria: he was also a mighty man in valour, but he was a leper

Being a leper is not a small ‘but’ and it qualifies everything else no matter how exceptional. This is the story of rental properties in Lagos. Because quality is generally not very good, when you find something that manages to pass the smell test, you pay with blood and tears for such comforts. Everyone I visited or know, had one major ‘but’ about their property. But they deal with it. I visited a friend who lives in a really nice and spacious flat on the Mainland. Alas when he showed me into the bedroom area, I thought I was falling down until he laughed and explained that the flat was bizarrely sloping down one way. I mean, this was a nicely looked after property and the landlord seemed to be a reasonable sort judging by what he told me….but it was sloping.

You don’t have that many choices. When you see something you can work with, you pay for it quickly through the nose, buts and all.

10. Approaching my Uncle’s house in Okota, we got to his street off Ago Palace Way and saw 3 ‘rivers’ ahead of us. It had rained you see and we weren’t in a 4WD. It would have been tricky navigating those rivers even if we had a small canoe so I rang him to ask what the deal was. ‘E ma wo inu omi yen o…mi o le predict bo se jin to’ (don’t brave the rivers as I can’t confidently tell you how deep the water is) was his response. So we turned around and went through another less flooded road.

It was great to see my Uncle looking rather well. But my suspicion is that the way he has achieved better health is by taking life extremely easy and not trying to ‘chase’ anything. Getting out of the area took us a full hour just sitting in one spot of the road that was so bad because some residents took LASG to court to stop them from fixing the road which was going to destroy their (illegally) built homes.

In Lagos, you pick your battles. Go out and hustle and risk your health and even life or just stay away from the grind and eat what you kill. Pick your choose.

11. Shoutout to the Molete Massive for making my trip to Ibadan an enjoyable one. I found myself touring Chief Omololu Olunloyo’s library and being awed at the music and movie collection there. From old Hubert Ogunde records to the complete works of Fela on vinyl not forgetting Sunny Ade as well. And there were tons of books and photos as well. There’s work to be done in digitizing all these private collections of history in Nigeria into something more accessible. His engineering thesis, submitted in 1957, the year Goodluck Jonathan was born, was something to behold. In those days, there was no way for typewriters to reproduce scientific equations so they all had to be written by hand.

Chief Olunloyo, at a trifling 78 years of age, is himself a force of nature. We began by discussing Framer’s Intent regarding Nigerian constitutions and ended up somewhere in between the local politics of Igueben and Okada in Edo State. No topic was off-limits.

He narrated the story of how his family were caught in the 1978 Ali Must Go riots when they were travelling in a CVU – Civilian Vehicle Unit – car. Someone saw the plates and decided to throw a large brick through the back window. The brick hit his then 9 year old son at the back of his head and damaged his spine. He was flown here to the Stoke Mandeville Hospital for treatment. 34 years later, he has remained confined to a wheelchair.

I wondered if he felt bitter about this and asked if the person was ever caught. ‘What difference would it have made?’ he responded. Some people were indeed tried but according to him, 40 people died on that same day when it happened so they were fortunate to an extent.

Sitting there in the immaculate looking 1945 colonial house he lives in, we were served very fine industrial grade world class garri with cold water and St. Louis cubed sugar. There was also a cooler of asun and another cooler of suya on the stick.

Sometimes I cannot believe my luck.

12. Staying with Ibadan – have you often wondered why the place always seems to look the same with the same rusted roofs dotting the hills? A friend of mine who has lived in Ibadan most of her life might have at least some of the answer. Listen to her:

You know in my part of Ibadan there is a lot of poverty there. We wanted to repaint our house but at the last minute my mother decided against it because it won’t go down well in the neighborhood

The ‘environmental costs’ of repainting the house apparently far exceed whatever benefits might be derived from staying inside a house with a new lick of paint. Be guided.

13. The UI International Cultural Center in Ibadan is apparently less than a year old. It’s as impressive as it is imposing when you enter and it was the venue of the wedding reception I attended.

Until you begin to check out the work that has been done and a sinking feeling comes over you. I went to use the bathroom and I was overwhelmed by the shoddy nature of the ‘finishing’ there. I inspected all the toilet doors and not a single one was working as advertised. All brand new and you could tell the tiles on the wall were expensive as they looked really nice. But the whole purpose was defeated by the useless way in which they had been put there. One of the toilet doors could not shut because someone had evidently not bothered to measure the door before installing it in the frame so, yes; the door was bigger than the frame.

I took the photo below as a particularly egregious example.

Take a deep breath and observe what is going on in the photo above. From the black hole in the wall in the photo, it’s obvious that the plan was to put 4 hand wash basins in the space there. Alas, no measurement was done beforehand so even after using a smaller one (middle) and squeezing it to touch the one left, it would be impossible to fit in a 4^th one there.

Understand that money has been spent on these fittings that were almost certainly imported. How does someone do this and go back home to sleep at night? Its one thing to complain about poor quality material but the problem in this case is an alarming poverty of labour that cannot even be called skilled.

It is well

14. And so it was that on my final night in Lagos, I fell into the company of some terribly bad boys. After hanging out with some friends, I told them I was going home to sleep as I had a flight to catch the next morning.

They were having none of it.

‘Are you the one going to fly the plane?’ said Winston*. I had no comeback to this but I bravely tried to mutter further protestations. ‘Look, I have gone to catch a flight straight from the club before… 12 hour flight. I landed in America and went straight to the club again’ said Harold* to my horror. ‘Are you afraid that you will miss your flight? We can make sure that plane wont take off until you are on it…we will just tell them not to send the manifest down…come let us show you another part of Lagos’ said Stanley*. I folded.

Dear reader, the opportunity to properly ‘research’ this piece was too much to pass up so I went along despite the warning from Edward* who said ‘ah don’t follow these boys around Lagos o’ before they quickly shut him down again.

Next thing I know, I am in the VIP section of a club called Sip with a very small crowd of people including Wizkid (his bodyguard is twice his size), Lynxx, Banky W and the delectable Genevieve Nnaji (it was her birthday). I buy music from these guys so you can imagine I was a bit star struck.

That report about Nigeria being a big consumer of champagne has to be true judging by what I saw. There were endless bottles of Moet and Hennessy being ‘cancelled’ as they say. I don’t drink, not because I am religious or whatever, but because I really don’t know how to. But I watched in amazement as the bottles kept being replaced for the 2 or 3 hours we were there. This is the life that caused Wizkid himself to ask the rhetorical question in Jaiye Jaiye – owo lo dun to yi?

It is hard to describe the frenzy that descends on a party when K Cee’s Limpopo gets played. Everyone goes crazy as if some kind of ‘familiar spirit’ has descended on the place. There were girls, presumably with rubber for bones, covered in sweat and ‘glistening like wet otters’ to borrow a phrase from Boris Johnson the London Mayor, doing dance moves that challenged at least a few laws of physics.

Yours truly stood in a corner quietly taking notes. Ok, I did dance when Davido’s Gobe came on but I did it so as to not be too obvious I was reporting for you. I got back home after 4am and decided it was too risky to sleep so I stayed up and went to the airport a couple of hours later. I am still recovering as I type this

Welcome to 1% Lagos. I suppose this is the way that people deal with the madness of the town and continue to function within it. A few days before I also hung out with some friends at Bottles on Victoria Island. It was packed to the rafters. On a Wednesday night with most people obviously still in their work clothes. The crowd drowned out the live band with their own singing. And no, it wasn’t a party…just a regular night out fueled by pitcher after pitcher of frozen strawberry margaritas.

‘Tis many a Lagos….none same as the other.

*Names have been changed :)

15. ********THIS SECTION IS TO BE READ ONLY BY NIGERIANS IN THE DIASPORA*******

The question of whether or not to move back home will never leave the mind of Nigerians working and living abroad. For some, the decision is made for them when things go bad out here in the West. Others bravely go for no other reason than the pull of blood.

But why should you go back at all? It’s most definitely not a better quality of life out there and it can really be a frustrating and overwhelming experience.

The answer is greed. This is the only sensible reason why you should go back home. And no, it is not a bad reason at all. You should go because you are greedy and want to do things that are not possible here.

Don’t take my word for it. Listen to Adam Smith in The Wealth of Nations:

It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest

It will be incredibly foolish to think you can go back home to ‘change stuff’. You almost certainly can’t. But as Adam Smith pointed out, it is in that intersection of everyone looking out for their own self-interest that value is created. It is that self-interest that ensures that there is no scarcity of meat, beer or bread.

Go back home because you are greedy and you want 50% returns instead of inflation + 0.5% that is available here in the West. It will cost you but you can always measure your success or lack of it in a more sober way. If you are not greedy, then stay where you are.

I am done.

FF

The story of the Amazon we all know (and mostly love) today is an amazing one. Jeff Bezos started the company in June 1994 and called it ‘earth’s biggest bookstore’. However in the first 6 months of its operation, it barely clocked $500k in revenues. But by 1996, it had sales of $16m and in 1997 it sold $148m.

Impressive numbers no doubt but there was a problem behind those numbers – the company was seriously losing money and burning through a frightening amount of cash in the process. By 1999 it was making revenues of $1.6bn but managed to lose $720m on those same revenues. By 2001 its losses had doubled to $1.4bn and it had racked up $2bn in borrowing from banks plus around $8m the initial investors had put into it.

How about its share price after it floated in May 1997 at $18 per share? Have a look at the chart below

Notice the precipitous drop in the share price from a peak of $115 around 1999/2000 to around $5 or so in 2001…all in just over a year. Just imagine you were an investor and you bought at $100…imagine the kind of reports that would have been written by analysts and so on. By 2001 when it made the huge losses referred to above, it sacked 1,300 workers, closed down two of its warehouses and shut down other service centres.

Somehow, in January 2004, ten years after the company started operations, it managed to post its first annual profit of $35m on revenues of around $6bn. Phew! And the rest as they say is history. These days its revenues are around $61bn a year and even though it still makes a loss now and again, it is such a part of the internet fabric that no one panics anymore. The company has almost singlehandedly redefined what the term ‘patient capital’ means. Somehow in all those crazy years when it looked like a lot of money had gone down the drain, Jeff Bezos managed to convince investors and lenders to stick with him.

One of the things that makes America almost unique among capitalist countries are stories like these – the way people will back a company with billions of dollars and stick with it even when it is losing a fortune. Sometimes they don’t even make their money back and the company goes bust along with everything invested into it – a good example was an online grocery delivery company called Webvan that went bust in 2001.

I left Nigeria very early in 2004 and I know definitely that work on The Rock Cathedral had already started. The papers are awash with stories today about the President, Goodluck Jonathan, as well as Tony Blair, former British Prime Minister, opening the now finished church yesterday. The number being touted as the cost of the construction on social media is $85m. It is an impressive building and will sit 14,000 apparently.

Let’s try to walk back 10 years from today. Think of the churchgoers as investors. Pastor Paul Adefarasin sold them a vision and they bought into it. Now if it ended up costing $85m then we can be certain that the initial cost when the idea was floated would have been a fraction of that. Given how inflation can be in Nigeria, let’s say the initial plan was to spend $5m. We can also be certain that Pastor Paul didn’t plan to spend 10 years building the church. I am told that it was originally to be completed in 2000 and was even to be called ‘Millennium Temple’. Selah

When you think about it – ‘investors’ have been pouring money, by way of offerings and building funds, into this project for maybe 15 – 20 years. Let’s say yesterday when it was commissioned was the day it finally turned a profit to complete the picture.

Friends, is the difference between us and the Americans only where we choose to deploy our own patient capital? There’s no doubt about this – we do have patient capital in Nigeria that can nurture a business or project through impossible times till it finally comes good. People were investing their money into this project for years based on no more than the model and 3D images perhaps. I have never been a member of House on The Rock but I can only imagine how many times Pastor Paul would have asked for more money or plans would have changed over the years. Just like Jeff Bezos.

In my head, I like to think of capitalism as a 2-step thing – aggregation and then deployment. First you round-up all the people who have money and find a way to make them give it up (willingly). These can be small sums and is what banks essentially do with your deposits. Aggregation helps you to build up the gunpowder that is capital leading to the deployment stage i.e who do we give it to?

There are 2 clear examples in Nigeria that show we are doing the aggregation part of the equation ok. The first is of course how our churches manage to raise vast sums of money at zero rates of interest just like the $85m above. You only need to go to a Holy Ghost Night programme or a large church in Nigeria to see how capital is being raised from investors on a weekly or monthly basis. Most of the large Pentecostal churches don’t publish accounts so we can only assume billions are raised this way every Sunday.

The other example is our Pension Fund system. Nigeria adopted the Chilean model in 2006 and since then total pension fund assets have grown from $1.8bn to $19bn as at November 2012. We now have 5.3 million Nigerians aggregating around $100m in capital per month into pension funds. And given our population size, there’s potentially plenty more to come.

This is where it all breaks down unfortunately. The deployment stage. In the case of pension funds, most of it still gets lent to government (although that is very slowly changing) and for churches, well buildings get built and other things get bought.

But I know of a very popular business in Lagos that will soon be shut down because it has defaulted on its loan payments. The loans were of course given at circa 20% interest rate and it is now being charged a penalty rate of perhaps another 10% on top of it for having the temerity to default on its payments. And there are plenty businesses like this out there pretty much trying to do the impossible by delivering returns over and above their eye watering cost of borrowing just to stay alive. Yet with a bit more patient capital, some of these small businesses might become world beaters or at least dominate Africa in a decade if they were allowed to grow without banks breathing down their necks. Just imagine if HoTR had taken the funding for the church building from a bank…

These things should challenge us as a country. A lot of countries are richer than us simply because they have figured out a way to direct capital to sectors of the economy that produce the most returns and create the most jobs. It is self-evident that there’s something wrong with the way we are able to finance enterprise in Nigeria. The Omidyar Network recently published an interesting report about Accelerating Entrepreneurship in Africa (read the whole thing if you can). In the section on Nigeria, it said this:

Nigerian respondents cited access to finance as a key challenge for starting and growing small businesses. In particular, the requirements for obtaining capital are prohibitive. As illustrated in Figure A13, Nigeria marginally lags her SSA peers with regard to financing, while the gap to global peers is more pronounced.
In-depth interview participants indicated that collateral of up to 120% is often required for debt financing. As a result, 67% of respondents believe that bank-lending policies for newer companies are more challenging than for well-established firms. There is also a perceived shortage of equity capital with only 15% of respondents believing there is a sufficient supply of equity capital for starting new firms

I highlighted ‘equity capital’ above. This is pretty much another name for patient capital. Not only are we doing much worse than our global peers, we are also alarmingly lagging our peers in Sub-Saharan Africa when it comes to financing enterprise. Surely none of these our peers even globally can match the grandeur of our churches all built with patient capital? The challenge for those of us who want to see enterprise bloom in Nigeria is how to mimic this church model to patiently fund businesses. Should entrepreneurs learn to sell their vision to investors like Pastors? Should we organise overnight investment conferences that somehow convince 50,000 people to attend and then get them to make a contribution before they leave?

Or maybe there’s nothing wrong here and I am just making a mountain out of a molehill. Maybe Nigerians are perfectly rational after all and having considered all the various investment options available to them (and there are legion), they decide to put their money in churches where they are certain of the best returns. Maybe Pastors are the only entrepreneurs that people feel comfortable backing even when things aren’t going to plan. Maybe Pastor Paul is our own Jeff Bezos after all who can convince investors to open their wallets again and again.

In which case, as you were. And I apologise for wasting your time with this post

FF

The Vanguard Newspapers has an editorial, chock full of brio and righteous indignation, about the government’s (admittedly still vague) plans to sell or concession or privatize the National Theatre in Surulere.

The editorial rehashes the usual arguments about the (unspecified) evils of privatization and unwittingly makes a case for the continuation of the status quo that has led to the current sad state that the theatre is in. Editorials like these help to buttress the widely held view that Nigerian newspapers have no idea what their role in society is and they assume that their readers couldn’t possibly know better.

But I’d rather focus on the most egregious paragraph in the mess

Will anyone contemplate selling London’s Hyde Park that has been open to the public since 1637 or the Royal Festival Hall?  The eight public parks in London cost the government about £30 million (about N7.5 billion) to maintain in 2012 though they generated £18 million (about N4.5 billion) income. Can Americans think of selling the 213-year-old Library of Congress though it cost will $750 million (N166.25 billion) this year to maintain its collections and 4,000 staff?  Will Wembley (the arena or the stadium) be up for sale to become a hotel? What these governments have done is find ways of maintaining their heritages without desecrating them. We seem to have no qualms in our own cases

This is a bizarre argument to make. Hyde Park is a park (the clue is in the name) and it makes no sense to compare that to the National Theatre. Wembley Stadium is owned (nominally) by The Football Association and there is a reason why it costs so much to watch a match or attend an event there. The ‘government’ ownership is an illusion as it is run like a privately owned stadium. Looking at the latest set of accounts for The FA from 2010 (page 37); you can see that the stadium generated £92.3m but still made a loss of £12m for the year. Why? A £23m charge for interest payments relating to the loan that was taken to build the stadium. But since the company that runs the stadium, Wembley National Stadium Limited is part of the group, you can see on the same page that the group overall still made a profit of £15m for the year, in other words, the losses are being subsidized  not by the government, but the money spinning FA. How exactly does this arrangement support the Vanguard’s argument?

How about the Royal Festival Hall? Again, thankfully, the accounts are public and it discloses that in 2012, the RFH had income of £42m (page 12). Of this amount, £19m came from the Arts Council (the Arts Council itself is part funded by the government with around 35% of its funding coming from the lottery and investments. See page 57 here ) while the rest of its funding comes from events and other sources like charitable donations. The point to be made about these examples is that they are not ‘government run’ in the way that we understand the term in Nigeria. The amount of disclosure that is available on the internet about their activities is a useful hint to this.

The irony is that the Vanguard is happy to quote figures relating to all these bodies in other countries but it didn’t bother to quote any numbers relating to the National Theatre. Well, let us help them

For ease I have done a quick chart with the budget allocations for the last 4 years I could find on the internet. Note that these are the allocations to the National Theatre via the Ministry of Culture.

What is immediately obvious from these numbers is that, it is not that the government is refusing to fund the National Theatre. Over the last 4 years, those numbers add up to almost N3bn (around £11m). The problem here is that the money is captured by those who have positioned themselves in the money’s path on its way to the actual theatre.

This is what you are defending when you say the government should continue to fund the theatre or increase it’s funding – you are simply calling for a transfer of wealth to a few lucky people. This is the real cost of keeping it in government hands.

Last week, it was widely reported in the papers that the government had come up with some plan to add a hotel and mall to the adjoining area of the theatre. Depressingly, this has been met with the usual howls of ‘preserving our heritage’, as if the current state of the theatre is something to be proud of. The place continues to decay as money is being poured into it, yet there are loud cries whenever any kind of change is proposed.

The question to ask is – who is going to die if the theatre is privatized or concessioned? Is this really such a strange thing to do? In using examples from the UK in its editorial, The Vanguard missed out a glaring one – The O2 Arena formerly known as the Millennium Dome.

The Dome was initially conceived during the government of Prime Minister John Major in 1994. Afterwards, Tony Blair’s government expanded the size and scope in 1997 and eventually and eventually it was opened on 31^st December 1999. As soon as it opened however, it soon became clear that the project was fast turning into a white elephant as visitor numbers were well below what had been planned not to talk of the cost of maintaining the place.

By 2002, the company which was set up by the government to fund the Dome’s construction was liquidated with a final bill of £790m and the Dome was closed down. Even while closed, it was costing the government £1m per month in maintenance.

Fast forward to 2005 and the Dome had been sold to the billionaire Phillip Anschutz of the eponymous Anschutz Entertainment Group (AEG) who then spent a further £600m completely changing the design (pretty much only the shell was kept the same) before finally opening it to the public in 2007.

Most Nigerians visit The O2 Arena when they visit London but what is even more interesting is that the Arena is nominally a concert venue yet a very large number of people go there without attending a concert. I have been there more times to hang out with friends or for a meal than to actually attend a concert. And this is very important – the idea of some kind of grandiose theatre that only draws a core of visitors is by no means sustainable. This is why the idea of a hotel or a mall on the premises makes very good sense. You need those people to effectively subsidize the whole operation but they have to come first.

You don’t even have to come to London to see a similar working model. Just up the road is the MUSON Centre. Surely there are far more people in Lagos who have attended a wedding or party at MUSON than have attended a stage play or musical recital there? Yet without these weddings and parties, does any reasonable person think the venue would still be financially solvent now?

The O2 Arena is surrounded by restaurants, bars, a cinema and other shops. It cannot rely on Beyonce concerts alone to keep the place going. There has to be the ‘daily bread’ aspect to its existence. And it’s just not about money even – the place has to have life and character and you need people to keep coming for that to happen.

The National Theatre was built to host events and stage plays. But there are simply not enough of these to capture the public’s imagination leading to it being turned into a wedding venue. But even this has been turned into a mess because there is no incentive to run it like a proper going concern as this will mean the loss of government funding…and of course the vested interests don’t want that do they?

The last time the government tried to privatize the theatre in 2001 there was so much outrage and defence of the status quo, depressingly led by Professor Wole Soyinka which forced the government to eventually abandon the idea. 12 years on, can anyone say the place has improved after billions have been poured into it?

Privatizing the theatre doesn’t mean that it becomes a private space where no one will be allowed to enter. If anything, the incentives to draw people into the place become far greater under private ownership.

What the debate should be about now is ensuring that whoever takes over the place produces a workable plan – with the numbers adding up – that ensures the theatre is kept open and increases the number of visitors to the place.

But the idea of jumping up to oppose privatization everytime it is mentioned belongs to another era. The government cannot do anything other than sink money into the theatre with nothing to show for it.

The government is right on this one. Sell the theatre. The heavens will not fall.

FF

I’ve taken more than a passing interest in Nigeria’s agriculture plans lately so I was roaming around the internet when I stumbled on a couple of documents. Nothing to strange about the documents in and of themselves except that they were written by two different sets of people and at different times meaning that we can look at them side by side and make some interesting observations and perhaps a wider point about the troubles that so easily beset us as a nation

Exhibit A: An Assessment of the Operations of the Presidential Initiatives on Agriculture in Nigeria: 2001 – 2007 – written by some Central Bank of Nigerian in-house analysts in June 2011.

Exhibit B: Rice Value Chain Transformation Plan (2012) – written by the Federal Ministry of Agriculture and Rural Development (FMARD) after a tour of rice production across Nigeria

The first document assesses the impact of various government policies to boost agriculture production in Nigeria across a variety of crops and sectors. The second one obviously focuses solely on rice. So to be able to make comparisons, I will focus only on the rice segment of the first document.

The first thing that jumped at me from Exhibit A under the Increased Rice Production and Export Programme (IRPEP) was this (page 14):

The overall objective of the initiative on Increased Rice Production and Export was to attain self sufficiency in the local production of rice in the short term (2005) and to produce for export in the medium term (2007). The project was expected to promote the production of 6 million tonnes of milled rice from 10.3 million tonnes of paddy by year 2005.

If that sounds familiar, it is because it is. Because when you go to Exhibit B, you’ll find this (page 2):

The goal is self sufficiency in rice production and complete substitution of imported rice by year 2015. Products in focus are parboiled milled rice and unparboiled milled white rice. The target is 6 million metric tonnes per annum of locally produced and internationally competitive milled rice by 2015.

Controlling for the ‘mere’ 10 year gap between when we set the targets initially and when we have now pushed it to, those goals look almost identical. So what happened? Well Exhibit A tells us that we managed to hit 4.8 million tonnes of rice in 2007 i.e. 80% of the target that was set. Production was also steadily increasing from 3m tonnes in 2002 to 4.2m tonnes in 2006.

I cant find any data for the 2008 – 2011 period so we have to engage in some educated guesswork. At the time of IRPEP, our domestic consumption was put at 5 million tonnes per annum hence the plan to produce 6 million tonnes and export the extra 1 million tonnes.

Adding up the projected rice production numbers for 2012 in the RVCTP document we get a shocking 601,459 tonnes for the year. In other words the ministry was expecting less than 1 million tonnes of rice to be produced in 2012 in Nigeria. The caveat to add to this is that a report by the United States Department of Agriculture (USDA) in January this year estimated our local rice production at 2.85 million tonnes. Whichever figure you believe, we suffered a disastrous collapse in domestic production somewhere between 2007 and 2012 of almost 50%. It is also not news that we have now become the world’s largest importer of rice with a projected 2.7 million tonnes of imports for 2013. Ironically, one of the IRPEP achievements listed in Exhibit A is that we managed to reduce our imports to less than 1 million tonnes in 2007 i.e. in around 6 years we have increased our imports by 270% while consumption has only increased by 20%.

This is the story of Nigeria and one that we should take a minute to reflect on. There is no amount of progress that we make as a nation that cannot be rolled back in a short period of time. We can afford to take absolutely nothing for granted if we want to get into the habit of continuous development. Those who say we should strengthen our institutions are right on the money – it is very hard for one person or ten to give us sustained development because people leave power or positions of authority and ultimately they die. We can take ten steps forward but the sin that doth so easily beset us and locks us in the habit of under achievement is never far away…we are like a nation trying to kick a long standing drug habit. Only a fool will say it’s going to be a walk in the park.

Without naming names, some people also work quite hard from morning till night and by way of securing their legacy, hand over their work to a random person who doesn’t share their values or has his own ideas. Nobody should then be surprised when things don’t go according to plan. It is uncanny that this rolling back of whatever small progress was made happened somewhere between 2007 and 2011.

This is all very important because we are back here again as you can see from the targets set out in the RVCTP. We now have an energetic minister who is going about his job with seemingly boundless energy. It is almost guaranteed that the person who comes after him wont run around like an energizer bunny moving to gear 6 what the current minister perhaps left in gear 5 (NAFDAC after Dora Akunyili comes to mind). And where will that leave us? Will we hit 5 million tonnes in 2015, the minister leaves office and then in 2019 we are wondering how and why we have become the world’s biggest importer of rice again after another ‘surprising’ collapse in domestic production.

This is just rice. As you know, there is nothing Nigeria does not have a plan for somewhere written with characteristic brio with targets aimed for the stars because the moon is too puny for us. What is perhaps most annoying or painful is that failure never seems to stop us from doing the same things over and over again while expecting different results.

In 2001, the Taliban decided to destroy some 150 ft tall Buddha statues in the Hindu Kush mountains in Central Afghanistan. The statues had been there for 1,700 years and would always be a potential source of tourist income for the country if left alone. It took the Taliban just one weekend using dynamites to blow up the statues.

Nothing is secured or guaranteed to remain there just because it is there. The most dangerous time for progress is often when people have relaxed and take things for granted. In one fell swoop, years of achievement can be rolled back and nations can find themselves worse than wherever they were coming from in the place. It has taken no more than a week to destroy confidence in Cyprus’ banking sector.

If you see anything good happening in Nigeria, keep an eye on it and think of ways to keep it going. If you close your eyes for one minute, even the little you are ‘managing’ will be taken away from you.

This is why we also must be suspicious of ‘young’ people who are currently running about declaring themselves as change agents and demanding to be loved. It’s not so much that they are lying, it’s more that they often don’t know what they are talking about. A lot of the arguments I hear these days seem to be that if we vote the ‘right people’ we will get, drum roll, the ‘right results’. And that somehow, contrary to what the Bard said, we somehow all have the art to find the mind’s construction in the face or the words that roll out of people’s mouths when they are seeking our votes.

Maybe the first question we should be asking anyone who puts themselves about for office in 2015 is – what gains do you think we have made in the last 4 years and what are your plans for securing them?

It would be absolutely mental to hand the keys to anyone – incumbent or opposition – who cannot answer this question convincingly. Enough of this one step forward and two steps back style of development.

We haven’t got all day.

FF

P.S Spend some time reading both documents just to compare how eerily similar they are.

I caught the last train from Shanghai to Beijing at 5.50pm. Coupled with the fact that the windows on the train were slightly tinted, it meant that within the first 30 minutes of a 5hr 30 minute journey, it was quite dark already. But China doesn’t seem to have an electricity problem so I could see lights everywhere. More importantly, as we were leaving a big city, I was keen to see where the development would ‘end’ so to speak. It didn’t. I kept seeing roads and bridges all well-lit in the night. Most of them were empty too – just 10 lane highways and bridges everywhere.

So on the journey back, I decided to take an earlier train so I could complete the journey in daylight. The journey from Beijing to Shanghai is around 1320km, significantly more than the journey from Lagos to Kano. It wasn’t just one road running alongside the tracks, it was different highways we were crossing. In 2011, the Chinese highway system surpassed the American Interstate Highway System in terms of total length. America started building theirs in 1957 and continued up until 2010. The Chinese built their first one in 1988…

It occurred to me that whenever I hear stories about poor countries that suffer food wastage due to logistic problems – like Nigeria where 80% of tomatoes routinely go to waste – I never hear China mentioned. Nigerian cows for instance will give anything to be transported on Chinese roads. It surely must be a lot easier and cheaper to move goods across China. Just think of the amount of business that has been made possible with this kind of infrastructure. This is probably why Western companies are falling over themselves to set up car plants in China. Those roads might be empty now, but as more people get wealthy, they will need cars.

When I landed at Shanghai Pudong airport, I was struck by how imposing the airport was. But then I noticed there was no other flight landing at the same time as we did. We cleared immigration in a few minutes and went to get our bags. I counted 20 luggage conveyor belts. Huge ones as well. Only ours was working. After leaving Shanghai, the first station we stopped at was Nanjing South which had 30 platforms. Depending on the size of the town, the stations we passed through had anything from 8 to 30 platforms. Modern, shiny, well-lit. Conversely, as we landed at the 99% full capacity Heathrow in London, our plane made a u-turn and started to taxi to the terminal. I looked out the window and counted 4 planes waiting in line to land. Yet the govt here can’t build a new runway or airport for love or money.

Seemingly empty roads, bare airports, more train station platforms than they need. In a country like China which still has huge amounts of poverty. What’s going on? This, for me, illustrates the paradox of infrastructure – you need to build it when you are poor because you wont be able to afford it when you are rich. Yes. Or to perhaps put it another way; if you build it, they will come…eventually.

Back to the train journey; every few minutes a high-speed train would pass us heading in the opposite direction. They also have a lot of expensive high-speed trains. Some months ago, I saw the photo below showing Chinese high-speed trains at a terminal and it looked almost beyond belief that they would have that much stock. But when trains pass you by every 20 minutes heading in the opposite direction on a 5 hour journey, you know they definitely have a lot of trains.

Since 2004, CRH (China Railways High-Speed) has taken delivery of around 1000 trains each one with an average of 10 cars. What the Chinese have built in 8 years took the Germans and British decades to build. They have so far spent something in the order of $300bn constructing tracks at breakneck speed. And as we traveled, you could see construction of elevated train tracks all over the place.

It’s also interesting that while here in the UK for example, normal speed and high-speed trains share the same tracks (meaning that signalling and scheduling have to be top notch), the Chinese simply built separate tracks entirely to accommodate the high-speed trains. No matter how uncharitable you are determined to be, it is hard to conclude that what they have achieved is anything other than remarkable.

As I was looking at all those roads, an idea came to my head. We know that Nigerian politicians and government officials love nothing more than to ‘commission’ or ‘launch’ things. They love cutting ribbons in front of cameras. Well, since we are friendly with the Chinese, why don’t we come up with some kind of exchange programme where we send our politicians to China anytime they want to open a new road to commission it for them? And just for the fun of it, we watch to see which one will develop arthritis in their wrists.

How about housing? Beijing is a really intimidating city. All the buildings are huge and imposing. But yet again, as you leave the city, you begin to see endless new developments sometimes seemingly in the middle of nowhere. Obviously there are a lot of Chinese people in China and it might be that the government is anticipating more migration from the Western provinces and is simply building these houses for that purpose. Or perhaps they plan to knock down some old buildings in the center of the towns and move people out to the suburbs. The things we refer to as ‘serviced flats’ or ‘luxury apartments’ in Nigeria are considered an efficient way of housing the masses in China. Of course if you are going to build a block of 20 floors, it has to be ‘serviced’. But we have now turned it into such a big deal (partly because of the ridiculous cost of cement in Nigeria) that it is not even an option anyone considers when talking about solutions to the huge housing problems we face in Nigeria.

Or the Subway system? Shanghai has 13 different lines and Beijing has about 15. And more are being built to cope with ever increasing number of people using them.

I don’t know how they do it, but building things has become easy for these guys. Or perhaps they have always been that way – they did build the Great Wall after all. But in a world where ‘infrastructure’ has become a cliché, it is quite something to see what its like first hand. When you approach the Shanghai Hongqiao Airport and Railway Station (They are side by side), you will be mesmerized by the flyovers to and from the area from all corners. It is infrastructure porn for lack of a better way to describe it.

The Chinese government is huge (they invented the bureaucracy after all) and can be deeply corrupt – the Bo Xilai case recently comes to mind. But for those who believe in the power of government to do big things. You can’t say the Chinese government isn’t ‘working’. A guy I met at the airport who has been visiting China for the past 10 years told me that 2009 was the year when they went ‘crazy’ with building stuff. This is probably why so many of the roads and bridges looked new. I suspect that Nigerians will vote for this kind of waste and corruption in their government by a landslide if given the option.

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Maybe there’s hope for us in Nigeria. The obvious evidence from China is that the more you do something the better you become at it and can do it even cheaper. The high-speed trains were initially imported under a technology transfer agreement. Today they are built in China and have started exporting them to other countries notably Georgia. It’s hard to get to 1000 trains when you have to import every single one. And you are not making a lot of progress when someone who left office in 1993 can still claim bragging rights that he built the most important bridge in the nation’s commercial capital.

It’s also hard to imagine a company like Julius Berger for instance continuing to dominate construction in a country like China (although Julius Berger is now a majority Nigerian owned company). They don’t like to rely on foreign technology for too long. They are very clever people and will quickly find a way to ‘own’ it. Once that ownership has been achieved, it then becomes like clockwork for them to rapidly deploy it.

Then there’s Chinese labor. This is probably the strongest thing about them. It’s not just that there are 1 billion China men available to work for a pittance, they are also very skilled. I am told that some Nigerians are now importing Chinese laborers for construction work in Nigeria. Actually this makes perfect sense to me and if I was awarded a big construction contract in Nigeria today, I’d seriously look into shipping in Chinese workers to do the job. The last time I was in Lagos, I was in a car passing through Yaba and saw a Lagos State government built bus stop. I couldn’t help but be irritated at how uneven the lines were and how shoddy the whole construction looked…which undoubtedly cost millions. It looked like it had been moulded together using someone’s bare hands. We must do better.

But I remember reading a quote attributed to Ratan Tata where he was talking about his motivation for developing the Tata Nano and he said ‘we need to take care of this segment of the market because if we don’t do it, the Chinese will come and do it for us’.

That one too is an option. We can always decide we can’t be bothered to master this infrastructure business and just pay someone else to do it for us….like the Arabs have mostly done. One thing is for sure though, we will be playing catch up forever if we continue as we are doing.

Shrugs. Some more photos below

FF

Ownership of this blog has its perks. One of such is the ability to change the rules as I see fit. So even though TWOTS is normally an account of a trip to Nigeria, the rules can be broken to take in somewhere else e.g. with Singapore last year.

1.  There is no access to Twitter* or Facebook in China. Several other sites are also blocked e.g. Bloomberg for this story they did last year. I quickly discovered that any site that had ‘blog’ in it was also blocked. Any website with ‘blogspot’ in the URL is also blocked. This might be a Google problem as YouTube was also blocked.

Some websites which weren’t themselves blocked but had a blog section e.g. the beyondbrics page of the FT would take forever to open, as if the website was going to Beijing to seek approval before opening. Sometimes I’d see a Facebook or twitter notification come through on my phone but if you then tried to open it, it simply wouldn’t. Instagram is allowed though as is Foursquare (perhaps to help the government monitor people better?)

Incidentally the Chinese economy grew by 7.8% in Q4 2012 while the US economy shrank by 0.1% and the UK by 0.3%. Are these things related? I couldn’t possibly comment on that

*While they don’t have Twitter, they do have the formidable Weibo, reported to be 500m users strong and is where the Chinese ‘children of anger’ reside. So before Dr. Abati sends a proposal to Mr. President asking him to ban the use of social media in Nigeria as a way of growing our nascent economy….

2.         Feeling like a tourist, I had mapped out my journey from the airport to my hotel using this website but I decided to try out the Maglev train going from the airport halfway into town (Longyang). 50 Yuan later, we were on board and the train soon reached its top speed of 431km/hr. How did it feel? Fast! There was a point at which it seemed to hit something like a gap in the tracks – at top speed – and it made a loud noise. That scared me but my fellow passengers didn’t flinch so I relaxed.

At Longyang it was time to join the normal subway and I realized something I hadn’t thought of at all before – there are no black people in Shanghai. So there I was on a Saturday morning on the Shanghai Subway in a packed train. The only black guy anywhere near the place. I don’t mind being black (not like I have a choice) and I am happy to be the only black person anywhere but this was slightly uncomfortable initially. Happily, the same thing in English follows the train announcements in mandarin and the signs also have English versions everywhere. Same for the ticket machines with a prominently placed ‘English’ button on the touchscreen. As such as I was able to go from the airport to my hotel without asking for directions once from anyone. Neat.

3. I booked a mini tour of Shanghai for the evening of the day I arrived before I left London, which included a Chinese acrobats show. It was 90 minutes of awesomeness made even more interesting by the fact that the acrobats made a few mistakes. The things they were doing – like juggling 7 balls at the same time – looked humanly impossible at times and I had to restrain myself from jumping up from my seat to applaud them (only black guy in the room remember?). Sadly we were told not to take photos or record videos to protect the ‘intellectual property’ of the acrobat company. Something I found rather cute in light of recent events.

Anyway the show went really well until a lady came out for her performance, which consisted of some card tricks. I was sitting in the first row only a few feet away from the stage so this compounded my ‘mesmerisation’. I hate stuff that can’t be obviously explained. Needless to say, the lady started off with a deck of cards in her hands and kept on throwing them to the crowd…and throwing them…and throwing them…and throwing them. Yes, the cards didn’t finish even when her hands were empty. She simply ‘summoned’ more cards of different sizes, which did as they were told and promptly appeared in her hands. And then she threw them again. Can any magic aficionado point me in the direction of something that explains this trick? Thank you.

4. Seems to me that a surefire way to ‘hammer’ in China is to set up an optician’s business. Everyone seems to wear glasses and even those who don’t, have it in their pocket or glove compartment especially taxi drivers.

5. Speaking of taxis, it’s now obvious to me that one of the first things to organize in a serious city is the taxi system. Singapore has the best and tightest regulated taxi trade I have seen. The government sets the prices for the taxi drivers and the business is closed to non-Singaporeans. Those who get it are thoroughly vetted and background checked beforehand and in exchange for all this, the government helps them to enforce some kind of monopoly by tightly controlling the amount of licenses it gives out. The result is very very cheap taxis that are as safe as can be.

Dubai also has a very good taxi network – all cabs are metered so need to waste time haggling unnecessary over fares.

If a city has plans to be a serious place open to people who want to come and do business there, then it needs to ensure that people feel safe and comfortable enough to get on a plane and journey from airport to hotel without too many worries. Shanghai cabs are metered and once the cab starts running, there’s an announcement in mandarin followed by an English translation. There are numbers to call in case of an emergency behind the driver’s seat and the starting fare is 14 Yuan for each journey. Again very cheap cabs to move around.

Here’s looking at you Lagos. Let’s sort out our cabs and make them safe and predictable in pricing. Whenever I am coming to Lagos, I only use a cabman that has been vouched for by my close friends and even with that, it’s a heart in mouth journey from the airport to the house for me. What if he suddenly parks somewhere and asks me to surrender everything and jog on?

6. There are some 24 million in people in Shanghai but it definitely doesn’t feel cramped. The roads rise to the occasion in their length and width and you just know if more kilometers of road are suddenly needed, the Chinese will sort it out stat (they spent $45bn just to get the city ready for the 2010 Shanghai World Expo, almost 50% more than Nigeria’s annual budget). These guys have cracked the infrastructure code, no doubt. The whole Pudong New Area was claimed from the sea (what Eko Atlantic wants to be) and is accessed by an underground tunnel road. I went there at night and I was amazed.

It’s understandable why they are proud of their city and fiercely protective of its image – when Mission Impossible 3 (shot in Shanghai) applied for a license to show the film in China in 2006 (only 20 foreign films are allowed to be shown in China every year), the authorities asked the film’s producers to cut out all the shots that showed high-rise buildings with clothes hanging in the open on the balconies. Skyfall too was asked to cut out the scene where James Bond effortlessly killed a Chinese guard when he arrived in Shanghai.

7. I was in Shanghai for an MBA related workshop for the first 3 days and I shared a class with about 20 other people. There was one Singaporean guy (half mandarin, half Malay so he spoke mandarin very well), a Cantonese guy from Hong Kong, A German guy based in Tokyo and married to a Japanese woman and myself as the only ‘non-Chinese’ people in the class. It wasn’t a particularly representative class of Chinese people as all of them had really good jobs (90% of them with American companies and had done a fair bit of travelling); nevertheless I tried to glean a few things from them.

First day of the workshop I arrived quite early to find one Chinese course mate waiting outside the door of the venue. She had forgotten the password we had been sent to let ourselves in so she was on the phone to someone trying to get it. I managed to remember it and I opened the door. It was just two of us there at this point but as soon as the door opened, she bolted inside seemingly to grab the ‘best’ seat in the room (since everyone uses laptops sometimes it makes sense to angle for a seat next to a socket). Now I am in my 10^th year in London and I know the town has softened me up but I found this rather hilarious. It occurred to me then that I had also been impatiently pushed out of the way the day before while waiting to climb an escalator out of the subway. Chinese people are perhaps competitive as soon as there’s something to compete for.

Later on, we were discussing about working for the government and working for the private sector and the Canadian lecturer spoke about how only 3^rd rate people end up in government in America after the great and the good have gone to the private sector. This same girl then went on a semi-rant about how there ought to be no shame in working for the government and how in China, only the best go into the government. To my surprise, all the other China people in the class let out a loud chorus of ‘nooooo’ when she said that. Like I said earlier, these are all middle class Chinese people working for multinationals so her making that kind of statement was perhaps taken as an affront to them. Nevertheless she wasn’t allowed to finish that point or repeat it.

Chatting with another girl, I was letting out my frustration at how slow infrastructure development can be in the UK due to NIMBYism and all manner of engaged minorities who can block a project they don’t like. I gave an example of how some people had got the government to commit to planting some trees to cover their view of the new HS2 rail line – which wont even be built until 2030 – simply because they didn’t want to see a train passing. Her response was ‘so the government listens to people there?’. In the relentless quest for development, people in Shanghai are now very familiar with the word chai – 湾仔 – what is written on a building when it needs to be razed to make way for something new such as a new road or a skyscraper. The government isn’t in the habit of listening to every last complaint and delaying what it has decided to do in the process.

Having said that, I ran into a British guy at the airport on the way back here who works for a Chinese company (and is looking to do business in Nigeria even) and he was telling me things have greatly improved in how the government compensates people for their land. Now the government might give people 3 flats in a new development in exchange for taking their land. When the block is ready, those people then sell 2 of them and become millionaires in the process.

8. I decided to do another tour of Shanghai on my own so I got in a cab and started off at People’s Square. Then walked to the Bund to look at the Pudong New Area

I had asked for the name of a street where cars aren’t allowed to pass from a coursemate and he helped me practice my pronunciation of it until he was sure a taxi driver wouldn’t take me to the border or some place else. So after leaving the Bund rather later in the night, I confidently told the first taxi driver I saw I was going to Bu Xing Jie. He dropped me off at the beginning of the street and I brought out my camera happily snapping away. By this time I was quite relaxed with the constant stares of people looking at the tall skinny black guy.

As I was strolling down the street, the first guy walked towards me and I was quite scared as the street was somewhat deserted by this time. He smiled and I returned the smile. Then he pulled out a card from his pocket with a rather fetching young Chinese girl on it. ‘You want nice Chinese girl?’ he enquired. I laughed and shook my head and continued walking. Of course what else was a black guy doing there if not to look for Chinese girls to sleep with? Totally understandable.

I walked further down and another lady came up to me. This one had about 3 cards and her opening gambit was ‘You want sex and massage?’. I laughed, shook my head and said no. She seemed offended and frowned before retorting ‘You no like sex?’. I was minded to tell her that it was the massage I didn’t want and I was entirely up for having sex with a Chinese woman in Shanghai as that was what brought me there in the first place. But I decided not to push my luck even after she offered to send the girls to my hotel room if I preferred it that way. 2 more people came with the same offer and one of them did it right in front of a statuesque looking policeman. Great to see the universal law of policemen and prostitutes holding up in Shanghai too.

Same thing happened on my last night in Shanghai and this time the guy wouldn’t let me be. So I took his card and promised to call him just so he could stop following me around. The wording on it is hilarious (see photos)

9. I had 3 days to kill so it made sense to take the fast train up to Beijing to check out another Chinese city. Beijing is ‘proper’ China compared to Shanghai’s westernized look and feel.

I kept expecting to get scammed and when it hadn’t happened by the 5^th day, I became ‘concerned’. My hotel in Beijing was in the center of town so I decided to go check out Tian’anmen Square (when Chinese people in China Google it, they get images of a park with lots of families playing and having fun. Try googling it and search on images to see what it shows you).

After seeing the square and along with the ubiquitous presence of members of the People’s Liberation Army, I crossed over the road in the direction of Chairman Mao’s larger than life face into the Forbidden City and its temples. In both places there was a huge crowd of people (on a Wednesday morning) just strolling around with their families and having fun in the sunshine. I had expected to see plenty of tourists but 99.9% of the tourists there were Chinese people themselves. Only black man again…sticking out like a sore thumb. After walking round I saw a guy with a camera that looked like mine and asked him to take a photo of me if it wasn’t too much trouble – this exchange was completed without words because by this time I had realized that mandarin is a ‘sound’ language. So even if you are speaking English and it’s too fast, you might unknowingly say something else entirely (the day before, I was taken on a merry go round cab journey after I had told the cabman that I was going to the Shanghai Centre. Perhaps ‘Centre’ sounds like the Chinese word for ‘railway station’ because that’s where he took me. Cue frustration as the guy didn’t speak or hear a word of English). Also when I wanted a guy to write something for me in Chinese characters, I wrote it down but he asked me to pronounce it vowel by vowel so he could know what to write.

Anyway, after getting this guy to take a photo of me, I thanked him and started to walk off when a rather innocent looking Chinese lady walked up to me to say hi. She spoke passable English and I think I was too relieved to find a Chinese person to chat to. She said she was from Wuhan and only came up to Beijing for sightseeing. I said I had wanted to go to Shenzhen, which is further along on the same rail corridor, and she was surprised I knew a bit of Chinese geography. I then talked about how impressive it is that there seems to be so much internal tourism in China much like the way Americans do which makes people poke fun at them at being geographically ignorant (as an aside, all the Chinese people in my class said they are always amazed at how Americans and the British seem to know so much more of their own country than they do. Nigerians aren’t the only ones who feel this way it seems).

I told the lady I was tired as I walked round the temples already and she said we should stroll down towards the station. We kept talking and she told me she was a teacher down in Wuhan and I told her about London. We talked about the Chinese government officials who made the rounds on Weibo recently for owning 20 Rolex wristwatches and so on. So she asked me if I wanted to grab a drink in a bar near where we were standing. Like I said she seemed completely harmless and there were policemen all over in a very busy area. So I said why not and we dived inside one small restaurant looking tearoom. We entered and she asked for a room and we were led into a small room with a table and teacups. Alarm bells started ringing in my head as the waitress shut the door behind her as she left. Anyway gist continued flowing and they brought a big pot of tea. I asked for coke thinking they would bring it in a can and I would open it myself. To my disappointment the coke was brought in a glass. Awkward. What if there was something to make me sleep in it while they took everything I had and left me only my boxers? My Mum is a Deaconess you see and I grew up as a church boy. So I began to ‘plead the blood’ over the drink silently. She was drinking the tea and enjoying it and she poured me a cup, which I didn’t touch. Gist continued and she showed me photos of her cute looking nephew on her phone. I wondered if she was some kind of prostitute but her nerdy looks made me rule that out. She drank more tea and I drank some more coke.

After about 45 minutes alone in that room and she on her 5^th or 6^th cup of tea, I told her I was ready to leave as I still had places to go. So she summoned the waiter and even told me how to call a waiter and ask for the bill in mandarin. When the bill came, I looked at it and smiled. There was the scam, finally. It was for 980 Yuan. The ‘tea’ was 800 Yuan and the ‘private room’ was 100 Yuan. The coke I drank was 30 Yuan and some biscuits, which she had nibbled on and I didn’t touch, were 50 Yuan. I could see her face starting to change with her not being sure if I was going to fall for the scam or not. I took this as my cue to take the piss. So I pointed in between the 9 and 8 on the bill and asked the waiter why she hadn’t put the dot there. I then pulled out a 10 Yuan note from my pocket and began to confidently wave it around. There was a look of horror on her face and one of irritation on the face of the waiter. She then began to explain to me that it was actually 980 Yuan and not 9.80 Yuan (by the way Beijing is very cheap so 9.80 Yuan wasn’t totally beyond reason for tea and coke. A train journey for instance costs 2 Yuan). I then started complaining about not having anywhere near that kind of money as I only drank coke anyway. I pointed to the 30 Yuan on the bill for my coke and continued to protest. Evidently this had happened to her before and she quickly opened her bag and brought out something like 300 Yuan and her UnionPay debit card and handed it to the waiter. She then asked me how much I could pay and I pulled out a 100 Yuan note and gave it to her. This moved us into the negotiation phase and a back and forth began with her pleading that there wasn’t enough money on her card to cover it all. ‘What was in the tea you drank?’ I kept asking her and she didn’t answer. In the end I brought out another 50 Yuan, handed it to her and headed out of the place.

I walked like 50 yards before looking back and seeing her, she smiled and I smiled back. She waved and I waved back and then she headed back in the direction we originally came from…to look for her next victim. What tripped me the most in all this was how disarming she was. I would have thought she didn’t have a single devious bone in her body. Of course I still overpaid and she probably made a profit, which I suppose was the whole point. In my defense, I did it for you dear reader…so that whenever you are in Beijing, you wont fall for this trick again.

10. ‘The only thing real in that market are the people. Everything else is fake’. This was how my friend described Silk Street Market in Beijing to me before I headed out to China. It’s a popular tourist attraction these days and the Chinese authorities continue to pay lip service to shutting it down.

Look, there’s a KFC downstairs in the 6-storey complex. It’s a fake KFC. How do I know? Well before I entered this one I had already visited 3 different KFCs in China, as I didn’t want to go to a Chinese restaurant and mistakenly order cat or mouse barbecue. So I stuck to what I was certain about. As soon as I entered this ‘KFC’ I knew it was fake. There’s an Apple store inside the complex. Yep, fake. Going through this complex floor-by-floor is to behold the awesome wonder that is Chinese enterprise first hand. It’s well organized too – basement is for leather goods, 3^rd floor for tailored clothes, 5^th floor for jewelers etc.

So you go in a store and see a bag you like. You ask how much and the store person brings out a calculator and types in say 2000 Yuan. She then hands you the calculator and asks you to enter your price. So you enter 150 Yuan. She pretends to get angry and asks if that’s dollars or Chinese money. You say yes, Chinese money. She then asks you for your ‘no kidding price’. After much haggling with you threatening to walk away, you agree on a price of say 220 Yuan. You take the bag and move on. If you come back in 5 minutes to the same shop and pick up the same bag, the store person will do the exact same thing i.e. start from 2000 Yuan. They do this to wear you down so that perhaps this time you might agree to pay 250 Yuan instead.

But I think something interesting is happening in these stores that reflect China’s growing ambitions perhaps. I needed to buy a leather traveling bag as I only took a small one with me. Now of course I was ‘spoilt for choice’ from Louis Vuitton to Burberry to whatever. Aside from the fact that I am not a designer person to the point where I would carry around an LV traveling bag, I also am unable to tell the difference between an original and a copy. They all looked good to me. Anyway I noticed one particular design in all the shops with some kind of horse design on it. I had no idea who the designer was so I asked and the lady in the shop said ‘no this one not copy, original Chinese design’. Every shop had this ‘designer’ in stock in all kinds of products from wallets to handbags to travel suitcases. And they were really good looking items. I am talking about stuff that you can slap a brand name on it and people will happily pay a premium for it. But here were the Chinese, confident enough to sell it under their own brand name and place it on the shelf right next to the fake Louis Vuittons and Pradas. The Chinese are not coming, they have arrived. I didn’t hesitate before buying the bag. They are still taking their inspiration from popular brands but it wont be long anymore.

There are tailors who will take your measurement and produce a suit for you in less than 24hours. There are fake iPads and fake converse shoes. It is impossible to tell the difference with a casual glance. Chinese labor is well and truly skilled because it takes some talent to copy stuff in the way these guys do.

11. Rushing back to my hotel in Beijing to grab my bags and catch the train back to Shanghai, I saw a black guy! leaving the hotel. Couldn’t stop to talk as I was in a hurry. I got to Beijing South Railway Station and it was so packed I could only get a train for 2 hours later. But then I saw the guy again and instinctively went over to talk to him. Turned out to be a young American kid who decided to leave Washington DC and come try out his luck in Shanghai. He works in consulting and feels the future is in Asia. Said he felt he would learn the language faster if he just came out to China and stayed there while applying for jobs as well.

Talking about how the job market works there, he said the hardest part is getting an interview because 99% of CVs out there are fake with people claiming to be able to do things they can’t. So getting an interview is as good as getting the job as it means the employer has applied the usual discount and you still passed. He seemed like a really good kid and we exchanged numbers. I thought it was pretty cool of him to leave America and come try his luck in an unfamiliar country.

Almost everything in China needs to be discounted in this manner. You can’t just take anything at face value it seems. Singaporean coursemate was telling me about how so many Chinese companies were coming to list on the Singapore exchange at one point and to hide the fact that say, 2 of the 4 people on the board were in fact brothers, they’d list their names to investors as Mr. Chang (Mandarin) and Mr. Cheung (Cantonese). Obviously the average Chinese person wont fall for such a trick so it seems a lot of these scams are aimed at gullible foreigners. I was mentally discounting everything like this as I went along – for example wherever I saw ‘massage parlor’; I immediately took it to mean whorehouse or something of the sort. Read this story as another example. Chutzpah I tell you.

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It’s impossible to document everything in one post and for this reason I have deliberately left out anything to do with infrastructure in this one – I will do that in a second post as I think it merits a discussion on its own. I apologize for the length of this post.

A lot of things become somewhat clearer after visiting China. Why does the Communist Party for instance try so much ‘thought control’? Well there are 1 billion Chinese and the thought of them getting angry must be a truly frightening thing. Walking round Tian’anmen Square and seeing PLA soldiers everywhere and all the propaganda all over the place confirmed this – Chinese people are constantly being reminded how great their country is and how gloriously the Communist Party is running it in general and the Politburo Standing Committee in particular. It is essentially self-preservation.

If you are reading this and you’ve mulling over going to China, take this as your cue – book your ticket and go. Don’t waste any more time, go see the country for yourself.  It is something to behold and experience, as I will try to describe in my next post.

As the guy I met at the airport said to me ‘this is your first time? Don’t worry, you will definitely be back’

FF

You can find my photos here on Facebook

Nigeria, I fear, is in grave danger of becoming a serious country when it comes to data gathering and reporting. Exhibit A: Dr. Yemi Kale, Nigeria’s Statistician General in charge of the National Bureau of Statistics (NBS).

You may recall him as the man who broke ranks last year by declaring that the agency’s data had found that the number of Nigerians living in absolute poverty had increased by 6 percentage points from 2004 to 2010. This is strange as we would normally expect the government to lie about such figures. Or perhaps, the NBS was engaging in a practice known as ‘kitchen sinking’ i.e. throwing out all the bad news at once so that anything that comes after looks really good? Let us not be too cynical as there’s evidence that the NBS is doing some really commendable work.

Yesterday we were inundated with news about how Nigeria’s inflation was now 9%, the first time in 5 years we have hit single digit inflation figure. This has been the CBN Governor’s target (single digit inflation) for a while now so I suspect the man must be delighted at the news. But what does this all mean?

Normally we would rely on newspapers to translate statistical jargon into plain English for us but alas, our newspapers are either regurgitating, word for word, what NBS said in their report (BusinessDay) or completely, perhaps mischievously, misinterpreting the information (Punch).

First of all, since we are all learners, we need to go down low to the method used in calculating these numbers (I’m sorry, I won’t do it again).

The NBS uses a ‘basket’ of goods to calculate the CPI. This is not a real basket (or is it?) but an attempt to replicate, as closely as possible, the things that ordinary Nigerians buy regularly with their money. The point of this is to track how prices of the same goods are increasing over time. This tracking can, among other things, influence monetary policy e.g. if prices are increasing too quickly, the CBN might take the view that this is caused by too much money in circulation and will then increase interest rates to make it harder for people to spend money ‘anyhow’. Here in the UK, inflation numbers are used to determine a whole range of things from the annual increase in train ticket prices to salary increases. So if inflation is 9% and average salary increases in the same period was 5%, then we know we have a problem as people are getting poorer effectively.

So yesterday the NBS told us:

The composite Consumer Price Index (CPI) which measures inflation rose to 9.0 per cent year-on-year In January (compared to 12.0 per cent in December).

This was the highlight of what was reported. Let’s unpack it on a point by point basis.

1. The NBS uses 2009 as its ‘base year’. Because this is an index, what this means is that the numbers are incremental from 2009. For example, we can assume that a tube of Close-Up toothpaste was in the original basket in 2009. Let’s say at that time it cost N50. In the index, this will be given a value of 100. If the NBS then went to the market in 2010 (they actually do) and found that the same toothpaste had gone up to N55 i.e. a 10% increase, the index then becomes 110, a 10% increase.

2. There are 740 different items – some physical goods, some services – in the CPI basket. That is to say the NBS goes to the market to check the prices of these goods every month. There is bread in the basket, there is wine there. There is also repair of clothing (obioma) and of course petrol as well as dental services and hotel accommodation. You get the gist – they try to gather as much price information as possible.

3. Now most people buy Agege bread every week but don’t repair their shoes or clothes every week. They buy vegetables, yams, potatoes and ‘soft’ drinks also very regularly but can go 2 or 3 years without needing to sleep in a hotel room, yet all of these items are in the same basket. What to do? There used to be a French Economist and Statistician named Etienne Laspeyres who died in 1913. Mercifully, before he left this world he came up with a way of calculating a price index that is now known as the Laspeyres Index. If you do not know what this index means or the formula behind it, I promise you, a single strand of hair will not be removed from your body. But if you insist, it is here.

The NBS uses Laspeyres Index to calculate Nigeria’s CPI. In other words it uses a            globally accepted standard. There are other methods used by different countries but    Laspeyres is very much mainstream.

As stated above, some items are purchased more often than others and as such have more of an impact on the wallet than others e.g. petrol more than shoe repairs. So weightings have to be applied such that some items in the basket carry more weight than others to reflect as closely as possible what Nigerians are spending their money on. Again, for example, we can say that if people buy bread once a week but buy petrol once a month, we will give bread a weighting 4 times higher than petrol etc.

Perhaps I have missed it but I cannot find the overall weighting used by the NBS but I am told by several people that food items account for 60% of the weight of the basket. This makes sense – we have a lot of poor people in the country and a feature of poverty is a lack of disposable income to attend a concert featuring Kim Kardashian. Food comes first.

4. To make things even more complex, there is plenty of price distortion and information asymmetry in Nigeria – the price of bread will vary even within a state like Lagos and there really isn’t any readily available way for someone in Lekki to know how much it is sold in Ojodu. Before we then move to other states and start to get all sorts of wildly different prices for the same products. What this means is that NBS cannot sit in Abuja or Lagos and collect prices then tell us inflation is x percent. To arrive at a single inflation figure that will be credible, we need to gather as much information about it as possible.

Thankfully, the NBS seems to have risen to this challenge. It reports that every month 10,534 informants across the 36 states of the federation and Abuja send it around 3,774 prices on various items. Whereas a UK statistician can simply go to Tesco or even online to obtain prices, the job of the Nigerian statistician is infinitely harder and more open to errors due to this manual process of data gathering. But this is far better than pulling numbers out of their behind.

5. We are nearly there. Apart from obtaining prices on a state by state basis, the NBS also splits them into urban and rural prices based on population figures. So the urban prices carry a 46% weight inside the basket while rural prices carry 54%. This is broadly in line with the 2006 census figures per Nigeria’s population distribution.

There is also a split between a Farm Produce Index (basically raw food prices) and a Core Index (stuff that’s been processed), but we can get away with not worrying about this.

So now we have a fairly rough idea of the plumbing underneath the NBS’ headline inflation figures. We can thus interpret the 9% figure better. Again let’s do it on a point by point basis.

1. In January 2013, the CPI rose by 9% on a year on year basis. What this means is that when the NBS compared the prices of the items in the basket in January 2012 to the prices it obtained from those informants in January 2013, it found that overall, the basket was 9% more expensive this year than last year. Please note that we are only comparing January 2012 to January 2013 and not anything that might have happened in between.

Imagine a chap named Faye (yes it’s a girl’s name but for this example it will have to be a guy). Faye only buys 4 items every month when he goes to the market – Yams, Ogogoro, Ponmo and Toothpaste. He also manages to stay sober enough to record the prices he pays for those 4 items every month when he goes to the market. This is what he recorded for January 2012 and January 2013

2. So is this 9% inflation increase year on year a good or a bad thing? It depends.Compared to January last year, Yams have dropped by 10% in price but sadly his beloved Ogogoro and Ponmo as well as toothpaste have all gone up in price. The total effect of what has happened to him – assuming his salary has not increased – is that he is now paying 9% more for the same things compared to a year ago. There might have been a Ponmo glut in the market in June 2012 which caused the prices to drop to N20 but Faye didn’t stock up then, so in January 2013 that is irrelevant to him.

Undoubtedly, a single digit inflation rate is much better than a double digit one. There is no debate about this. But the NBS also remind us of what happened in January 2012 – fuel subsidy was removed and in the confusion, prices went up arbitrarily as everyone from bus drivers to market women tried to protect themselves from the price shock. There was also a strike which paralysed businesses meaning that scarcity would have also caused prices to go up. The most important thing to note here is that what happened last January was not normal. In fact January is generally known to be a ‘broke’ month – everyone is coming down from the high of Christmas and New Year spending and the IJGBs (I Just Got Backs aka returnees) would also have left the country with their inflationary pounds and dollars. So we would expect prices in January to be restrained in a normal January.

Unfortunately, as impressive as they are, this is where the NBS numbers stop making sense at least to me.

According to them, prices in January 2010 were 12.6% higher compared to January 2009. In January 2011, prices were 12.1% higher compared to January 2010. In January 2012 – this is the crucial one – prices were 10.9% higher than January 2011 and of course in January 2013 they were 9%.

Let’s go back to what NBS said in their report yesterday;

The relative moderation of the Headline index from 12.0 in December to 9.0 in January could be largely attributed to base effects- These are as a result of higher price levels in the previous year, which imply that the year-on-year changes exhibited this year will be muted. In particular, the Nigerian economy exhibited several shocks in January 2012. The partial repeal of the Premium Motor Spirit (Petrol) subsidy led to increases in transportation costs as well as secondary effects, as the transportation costs affected both food and non-food prices. There were also the civil protests which followed, and the man-made price gouging during the month, as merchants tried to take advantage of temporary shortages.

The NBS are telling us that the reason for the 9% rise – the first single digit rise we have seen in 5 years – was that January 2012 prices were already very high due to those abnormal shocks the economy witnessed. Fair enough. But why is this shock not reflected in January 2012? From the figures I quoted above, you can see that when January 2012 was compared to January 2011, the increase was only 10.9%, certainly not the sign of a shocked economy anywhere. Or were the January 2012 numbers wrong? Did the methodology change? (I suspect this is the answer). You cannot say on the one hand that inflation in January 2013 was single digit because a lot of pain was frontloaded in January 2012 and then present figures that do not show the slightest hint of any pain for January 2012.

Interestingly, prices in December 2012 were 12% higher when compared to December 2011. In turn, December 2011 was 10.8% higher when compared to December 2010. This even makes more sense as a ‘shocked’ economy than the January figures and we know for a fact that fuel subsidy didn’t go until January. Was the economy ‘shocking’ in anticipation?

It is possible that the economy is now more stable. It is possible that this stability has allowed people to worry less about the future and as a result, the kind of anxiety that might normally cause prices to go up in Nigeria is now reduced. This is a good enough reason for inflation to slow down and in fairness to the NBS they do use the word ‘could’ implying that there were other factors at play.

As I stated earlier, I also strongly believe that the methodology or weighting of the basket has been changed in the last year which is probably responsible for the fall in the CPI. Regardless, these figures will be useless if there is no consistency over time. And if the NBS are telling us one thing and the numbers are saying another, then it would be hard to place any confidence in their numbers which is the entire point of the whole exercise.

They say statistics are like a bikini, what they reveal is very suggestive but what they conceal is even more vital.

Update: The NBS figures are even more normal than I thought. In looking at the numbers I missed out something – the movement between December 2011 and January 2012 is indeed abnormal (+2.29%) reflecting the subsidy removal.

Thanks to @walesmit in the comments for pointing this out. It remains interesting that even though prices shot up in January, according to the NBS figures, they never came down from this artificial high…they simply stayed there and then climbed slower throughout the year. In 2011 for example, prices came down by 0.54% in April while in 2010 we had 2 months when prices came down. But we never witnessed any such come down in 2012. Admittedly petrol didn’t go back to the original N65 but I would have expected a contraction at least in one month after the knee jerk reaction to the subsidy removal.

Does this prove the point that when prices go up in Nigeria they never come down?

FF