Tuesday, 24 May 2016
The battle and the war
By Ray Ekpu
About three weeks ago, the Minister of State for Petroleum Resources, Ibe Kachikwu, came with the Minister of Information, Lai Mohammed to brief members of the Newspapers Proprietors’ Association of Nigeria (NPAN) on the oil industry. He had no notebook or piece of paper but was reeling out facts and figures that he thought the media chiefs needed to know. He proved that he had mastered his turf and was ready to do battle with the media movers and shakers before him. But he did not go through any serious grilling because his listeners seemed to know quite a bit of what he was saying. These were senior operators in the media who had been around for quite a while and had witnessed all the crises occasioned by the multiple petrol price increases over the last four decades. He was apparently preaching to the converted. I asked him what would be the cost of petrol if we were to deregulate it. He said N150 per litre. What that means is that at N145 per litre we are merely increasing the price, not fully deregulating the downstream sector of the industry.
In the last 44 years, the various Nigerian governments have increased the price of petrol 26 times. That means that on the average we have had to pay a higher price for petrol every 18 months since 1972 when the commodity was sold for six kobo per litre. Each time there was a price increase there was always war between the Federal Government and the labour unions and other organised groups like the National Union of Nigerian Students (NUNS) or its latter day offshoot, the National Association of Nigerian Students (NANS). Each time there was an increase in price the response was routine. There will be a lot of noise from the public and the government will roll out a list of things it would do to cushion the effect of the increase. It would then point to a few buses dripping with fresh paint. Then it will take a few kobo off the increase and all will be quiet. Then everyone goes back to bed.
Despite these price increases over the years, scarcity of petrol was always a lingering problem in most parts of Nigeria except Lagos and Abuja. Even in Port Harcourt where we have two refineries and Warri and Kaduna where there is a refinery each the residents hardly bought petrol at the regulated price. Residents of these refinery towns may have asked themselves why they would live on the banks of a river and wash their hands with spittle. This was a question that no government made any serious effort to answer. If they did, they would have paid attention to our refining capacity or lack of it. But because of the corruption in the industry which was only a little short of “fantastic,” the patent belongs to Mr Cameron, we were more interested in importing than in refining. We have never asked the question and are not asking it even now. Supposing for some reason such as a war, a blockade, sanctions or whatever we are unable to import petrol how will we survive without local refining? Two of the major reasons why the Biafrans lost the civil war were food and fuel, among other things. When the Nigerian Government starved Biafra of both it was obvious that Biafra’s days were numbered. That should tell us that food and fuel are national security artefacts. I wonder whether our national security decision makers ever factor these two items into their national security calculations.
In January 2012, President Goodluck Jonathan increased the pump price of petrol from N65 per litre to N140. It was considered by many people as the worst new year gift that a government could have given to its citizens. First, the timing was wrong. After spending money during the Christmas, New Year and for children’s school fees, no one was ready for the rude announcement of a hefty petrol price increase. Secondly, an announcement of that nature ought to have been preceded and accompanied by a massive public enlightenment campaign. Most of the stakeholders simply learnt of the increase from the media. The Nigeria Labour Congress (NLC) and civil society groups working in cahoot with the main opposition party, All Progressives Congress (APC), did a better mobilisation of the people against the increase than the government did for it. But then the NLC was a united entity, the PDP was ineffective in marketing its message, while the APC saw that chink in the Peoples Democratic Party (PDP’s) armour and capitalised on it. The strike succeeded and the government rolled back the price to N97 per litre.
Why are things different now even though the price is even five naira higher? Why has the strike failed? There are several reasons. One, the NLC has been factionalised since 2015. There is the Ayuba Wabba faction, which has got a wider recognition and there is the other minor faction led by Joe Ajaero which the government is mischievously cuddling so as to kill the strike, and the spoilsport is happy for the ephemeral romance. Besides, the Trade Union Congress which is an eternal rival to the NLC has pulled out of the strike deal which it had previously signed on to. The NLC leadership apparently did not seal a deal with NUPENG and PENGASSEN, two important unions in the oil industry. If these two unions had taken part in the strike there would have been no petroleum products for sale anywhere. The government would have been boxed into a corner.
Two, I think, the NLC missed the mood of the people who have been buying petrol in various parts of the country at ridiculously high prices. They had come to believe that it was better to have fuel at a high price than not to have it at all, the so called regulated price did not really matter to most people at that point because they were already buying fuel of questionable quality from the black market at a higher price.
Three, the media were generally lukewarm towards the strike. Even though the Federal Government never made any serious effort to win the media to its side on the issue apparently because of its inexplicable hostility to the media, most of the media chiefs thought deregulation was a policy whose time had come. The NLC did not seem to have enough time to engage the media before it rushed to its placard manufacturers.
Four, most people may have discovered, even belatedly, that the so-called subsidy fund may actually be going the wrong way and making some people’s stomachs fatter.
Five, petrol is being diverted by some unscrupulous Nigerians to Chad and Camerouns where the product costs more. This may have convinced some people that the scarcity in Nigeria may never end if we do not match their price or at least narrow the gulf in the price between Nigeria and these countries.
Six, the smart move by the government to get an injunction from the National Industrial Court on the eve of the strike rendered the strike an illegality. That means that the government would be on a legally sound ground if it invokes the “no work, no pay” policy. There aren’t too many workers who are ready to risk their jobs or their salary at this difficult time.
Seven, it is becoming increasingly clear that the government does not have the quantum of funds it used to deploy in fuel importation particularly with the scarcity of the dollar and its escalating value. With the sharp drop in the price of crude from over $100 a barrel to less than $40 it is obvious that Nigeria is in trouble. This trouble is compounded by the drop in production from about 2.2 million barrels per day to about 1.5 million barrels due to disruptions by militants in the Niger Delta region.
Eight, the main opposition party, PDP, is missing in action. Apart from some shrill noises made by some PDP members in the National Assembly, there has been no articulate opposition to the price increase. It is either that the party thinks the policy is worth supporting or it is suffering from the disease of absentmindedness due to its present housekeeping problems. This is different from the robust opposition of the APC in January 2012. I am by no means suggesting that an opposition party must oppose every policy, good or bad, of the government. No, but I expected that either way the opposition ought to articulate, with facts and figures, its position on a matter of major significance such as this.
Nine, many well informed Nigerians believe that deregulation can make products easily available, can increase investment in the sector, can increase job opportunities and can improve the quantum of funds available for capital projects if the government manages the funds well. These are all paper speculations. The real work is to ensure that the government is focused on achieving these positives. And that is where the NLC and other stakeholders should focus their attention on.
It is fruitless for the NLC to continue with the strike option. It should read the writing on the wall. Nigerians have moved on. That is why there is normal life in most states of the federation. The NLC should pull away from the strike and seek to engage the government on palliatives, minimum wage and transparency and accountability in the oil industry.
The NLC has only lost the battle, not the war. It still remains, even in its splintered shape, the major tool that Nigerians can use when the occasion calls for it. We must support the NLC to survive this debacle because our democracy needs a vibrant opposition which the political parties are unable to provide right now. If we do not have a vibrant opposition, this government will transform into a dictatorship we cannot tame. The signs are already there.