Friday, June 11, 2010

Weak Judicial System is a threat to Nigeria Future

What future does a society have where a relationship between the judicial system, police force, army, public and politicians is fragmented? Each one of the above groups has some form of impeccable record of involvement in ‘dirty dealing’. The biggest threat to the future of Nigeria is the first group. Without a strong judicial system and a good framework for law and order; the other groups are open to operate in a lawless society with endless corruption.

Is Nigeria going backwards or perhaps stagnated in development as a society? Over the past 50 years, Nigeria has only managed to developed just two cities (Abuja and Lagos). With Abuja built at the expense of the rest of the country and only there you can really feel we are making progress. The fundamental problem I think is the obsession with money. This obsession has changed our values, discipline and integrity. Everyone is dealing with each other with high degree of distrust. The relationship between father and son, business and employees, teachers and students and government and citizen are not with mutual interest. Each one fighting for his/her own selfish motive. There is simply no cooperation and cohesion among us.

Nigeria is one of the few countries in the world with large numbers of first degree and PhD holders. So what is the essence of these qualifications when there is no avenue in which to put this knowledge into practice? Perhaps this is the reason why so many graduates are fleeing the country for greener pasture. Some of whom have found that life is even tougher in the foreign country especially for those that are not willing to be re-educated on foreign soil.

Fundamental Change
We have highly qualified people in key positions in the country, some of whom I strongly believe want to make a difference and change Nigeria for the good, especially those who have acquired their discipline outside the country. Those who have lived abroad or studied abroad know how comforting it is to live in a well functioning society where the rule of law is upheld with high degree of confidence. But in Nigeria, there is one big obstacle, the readiness of the people for change. Are Nigerian people (the populace) really ready for change? If so, in what ways do they expect these changes to be? These two fundamental questions are essential if those we elected are to implement changes that will move Nigeria forward. It is going to be very difficult to implement changes that will affect the livelihood of the masses, if populace is not ready and willing to abide by law and order. Well they say ‘it takes two to tango’. Therefore, all stakeholders (public, government officials and other groups) need to be singing from the same hymnbook. We need to ask ourselves as a citizen; what are we ready to compromise if changes are to be enforced? What part of our lifestyles are we ready to compromise to ensure that Nigeria moves forward? Below are few examples:

Business and Taxation
Income and business taxation is an important source of government revenue, the Nigerian government receives little income from this source. Currently, only a small percentage of large corporations pay taxes. There are thousands of small businesses operating in the country and the government is receiving little or nothing. Some employers failed to register their employees and remit taxes to relevant authorities. To address this, in 2002 the government amended the 1993 Personal Income Tax (PIT) Act to make non-compliant employers liable to penalties up to N25,000 (Twenty-five thousand Naira – approximately £100), as well as liable for the payment of all tax arrears. Therefore, it is financially sensible for small and medium size companies to pay a fine rather than report taxes due. We need to help our government to help us. Reliance on oil money as the main source of federal revenue and to cater for every need of the country is simply ineffective. This is evidential as only two cities in the country can boast of infrastructures to encourage business development.

We simply believe we can buy our way through everything with ‘Oil money’; we stopped being a productive nation and became a consuming nation. Nigeria import more goods into the country than export – a process that leads to national deficit (debt). Import duties are not properly accounted for, with Custom officials raking millions of Naira daily into private pockets. We are so obsessed with money that some of us go to any length to have it.

Contractual Obligations
In any civilised society the contempt of Court is a serious crime. A large percentage of companies and individuals will fail to honor their side of obligations believing that the other party to the deal cannot file a law suit. If the other party does, the party with the big bank balance or most influential in the society wins the court case. Lack of reliance on court order is a genuine threat to domestic and foreign business that wants to conduct business in the country.

As a Nation perhaps the biggest obstacle in the development of Nigeria is oil discovery. Since Nigeria discovered Oil, we have simply lost our ways as a country. Our ability to be creative ceased as we found easy and fast ways of making money. The same attitude and approached is cultivated by most of us living at home and abroad. No one is really patient; It is all about quick bucks. Nigeria and other sub-Saharan countries were predominantly farmers but not any more. Everyone wants to live in the City and get a quick share of the oil money. There have been mass exodus from rural areas to the cities (Lagos especially). The tiny Lagos State inhabits 18million people today. This is twice the entire population of three States (Oyo, Ondo and Ogun States) combined in 1973 according to figures released for the abortive 1973 census. At the time Lagos State population was 2.5 million, a staggering 620% increase over 37years.

Nigeria sell up to 2m barrels of oil daily, current price of crude oil at $70.00 a barrel. This is a whopping $140m daily revenue ($3.2bn a month - with average 23 business days per month), albeit this would be shared between the foreign Oil Companies and NNPC. It has been reported in the past that NNPC failed to pay up their part of the deal for oil exploration leaving the burden to foreign oil companies. Dispute between Richard Branson and the Nigerian government over Virgin Nigeria is another case in point for not respecting contract.

Despite this huge amount of revenue, most infrastructures in the country are below standard and some are still the same as were left by Colonial government when Nigeria population were not as large as it is today. You can imagine a transformer installed to supply electricity to 20 houses; the same transformer is still in use today to supply more than 500 houses.

There are various aspects of our lives that will make changes difficult to implement. Nigerian government has never been short of good programs and policies to improve living conditions in the country. What are preventing these changes to happen are implementation, greed and obsession of all stakeholders with money. Until the Nigerian government creates an environment where people can be brought to justice for reckless greed, corruption and other criminal activities, we have no way forward. Economic and Financial Crimes Commission (EFCC) is a start to moving Nigeria forward. Our judicial system must be stronger than ever and free of bias and influenced by powerful politicians. Everyone should be able to account for the source of their wealth; focus should not be on the politicians and government officials alone but on all stakeholders. Lawyers, bankers, students, civil servants and those in the Diaspora should all be able to explain their source of wealth.

Africa has been growing at a fast pace in the last decade with African commodities and equities in high demand from the developed nations as well as the BRIC countries. Africa currently holds approximately 10% of world oil reserves and there are still many untapped natural resources. Nigeria needs to take a leading position in making Africa stronger by utilizing its resources in an efficient manner. To get to the level where Nigeria fulfills its potential; our leaders needs to provide a safer environment and promote good governance culture at all levels to encourage and attract business into the country.

These are the areas where policy should be focused. Our judicial system must fully support EFCC effort to clean up our society. Also a strong and robust financial regulation is required to stop our financial institutions being used as a conduit for money laundering.

There is no point in having individuals richer than the entire United Nations when millions of people are suffering at their expenses. A clean society may not happen during my generation, but at least the country have started the process now.

Ajibade Yusuf
Gradient Consulting

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