by Agha Egwu
Let’s face it – Muhammadu Buhari is a modern high powered almajiri. He flies around begging for loans, getting none! But he does not understand that he is the problem.
President Buhari flew to China, cap in hand to beg for a $2 billion dollar loan. He did not get it. Instead the Chinese bamboozled him with a $6billion credit line. Emefiele immediately saw the opportunity and seized it with both hands. The All Progressives Congress (APC) Yorubas and normal economists are celebrating the “breakthrough”, but they may be shocked because like all APC promises, this may come to nothing – because of Buhari.
Please note the Chinese offer is neither an APC or Buhari idea. It is a Chinese strategy to turn the Yuan into an alternative global currency to the dollar. Previously, Nigeria could not be bothered because the oil market was strong. Now that we are in a financially weak position and went cap in hand to beg for loan, China saw their opportunity to use Nigeria as a strategic partner to make Yuan the trading alternative to the dollar in Africa.
What they are offering is irresistible. They are offering a lower exchange rate than the dollar, and a direct swap with the Naira. It means Nigerians can buy Yuan from the banks just as we buy dollar. The Chinese will then have Naira to execute their projects in Nigeria. There are various ways they can convert the money they make back to Yuan. They can run the projects such as the rail lines from Kano to Lagos and Calabar to Lagos and recover their money with profit. To convert to Yuan they can buy crude oil or tap minerals or swap with dollar at a later date when the dollar is less expensive.
The immediate effect of such a deal is that demand for dollar in Nigeria will start falling. This will not have any immediate global impact on the dollar but it will be hugely beneficial for Nigerians as the cost of the dollar falls in Nigeria but not globally.
However, there is a longer term threat to the dollar. China wants to make Nigeria, the clearing house for Yuan in Africa. That is also irresistible to Nigeria. It means that other countries currency trade will flow through Nigeria making Nigeria a forex trading hub for Africa. The long term financial implications are huge.
There are multiple benefits:
1. The dollar value in Nigeria will fall.
2. The Chinese will build and run many of our infrastructure for years, making the country more efficient.
3. In order to repatriate their profits they will buy crude oil or mine and purchase minerals increasing our export to China.
4. It will make us the currency hub of Africa.
5. It will create thousands of jobs.
If the chinese strategy succeeds Buhari will write his name in gold. Irrespective of all his bumbling everywhere else, we would all benefit from a Chinese run economy – light, trains, roads, etc.
These things are irresistible. There are three problems though:
1. We will resume intensive importation from China. That will kill our diversification policy as it will be difficult for us to make goods that compete with Chinese imports, unless we have a govt that surgically controls what we import or produce.
2. The Chinese will systematically increase their influence and control of our economy and this may lead to a neocolonial relationship. Unless we have effective leaders we might become a client state of China over time. From our experience there will be little hope of such a leader.
3. The US will not stand by and watch this happen. It has already started reacting with Forbes criticism of this deal. Still we don’t know whether Buhari signed any deal. If he did, then it will be a crime in US eyes as substantive as Jonathan’s anti-gay bill and romance with China. It will spell the end of Buhari as the US will do to him what they did to Jonathan – blacklist him and get rid of him.
There are several reasons why this deal may not work. Some are linked to Buhari’s peculiar agendas.
1. Buharinomics: This is a special branch of economics that has certain principles. These are Islam first. Buhari’s family, friends and the fulani next, all other Muslims next and finally the use of intimidation and violence to force economic policies that satisfy the first three rules. What the Chinese are offering does not suit Buharinomics. It will immediately shatter the cosy round tripping that the two tier forex system offers the fulani – making profits in billions for Buhari family and those around him. The Chinese may not understand that.
2. Islamisation: The Chinese offer will destroy Buhari Islamisation policy. The Quran requires that the infidel be subdued and feel themselves subdued. The greatest beneficiaries of the Chinese offer are the Igbos. They dominate the Chinese trade and china is losing heavily as the dollar price has killed off the Igbo chinese trade. China wants it back. However, this makes total nonsense of the Islamisation policy. Buhari hates Igbos if they remain infidel. If they convert to Islam he will love them instantly. So a policy that will primarily boost Igbos, when they are physically destroying Igbo markets is not likely to sail through. The Chinese may not understand that.
3. Political Upheaval: Islam divides the world into Islamic lands of peace and Infidel lands of war. The OIC plan for Nigeria requires the total subjugation of the South East and South South which are christian enclaves. They are already ringed with the army with plans for Fulani settlements that will wage war through struggles for land and massacres. Those that convert or let their children become Muslim will be spared over time. That is the theory of Islamic expansion over the ages but it has not yet worked in modern times. The last it worked was in Turkey with the Armenian genocide. They are trying it now in Syria and Iraq and it is not working. The world is fighting back. They tried it in Sudan and Central African Republic, it did not work. The Christians fought back with world support. Now they want to try it in Nigeria. At some point the Christians will pick up arms and fight back. The Chinese are aware of the coming upheaval. That is probably why they will not give a loan but a credit line for trade. Loan is long term and can be lost in a war. A credit line is a case by case trade exchange. You give us a project and we build. As we build we collect crude oil and minerals and go. Nothing owed.
4. American machinations: America will not sit back and watch Buhari fuck up the dominance of the dollar. If he tried it eh… They will get him out of power faster than they did Jonathan and look for a more reliable partner to install as President.
5. Buhari’s FinanciaL Illiteracy and Greed: Buhari’s understanding of corruption is very peculiar to his Islamic world view. Essentially if you commit atrocities but it furthers the cause of Allah and Islam you are not condemned. That is why massacres mean little as Jihad furthers the interest of Islam, even though the rest of us see these as crimes against humanity. Buhari for all his famed frugality spends like a child. With the Arabic penchant to see State money as personal money, anyone who takes the money is crooked except yourself and approved beneficiaries. Buhari wants money, cash to fuel their life styles. Anything that does not yield cash is not of interest to them. They will spend. Others can sort the loan later. The Chinese are aware of that so they were probably cool on the loan.
6. Fayose Letter: It is doubtful if there is anything in Fayose’s letter that the Chinese did not know. However, for a sitting Nigeria Governor to confirm their concerns would have weighed strongly on the side of caution.
Finally, Buhari is the problem. He himself. Unless Nigeria gets rid of Buhari as soon as possible we will never get international help.
Why? There are some reasons.
1. Buhari’s name stinks in international financial circles. Can you remember the Buhari 1984 change of money and the 53 suitcases saga? Well, what happened was that Naira was trading freely as a free currency then. Buhari suddenly stopped it and changed the colour of the Naira. Many financial houses trading the Naira world wide lost billions. That was how the Naira became a pariah currency till today. It took years before they allowed us visa and mastercard starting from the Obasanjo era.
Financial Houses have long memories. Immediately JP Morgan typed in Buhari in their computer, the 1984 episode came up and they pulled away. The rest of the world followed suit. That is one reason why Buhari cannot get any loan from any western organisation, nor can he really get any inward investment from the West. The Chinese are different. They can dine with the devil..
2. The second reason has to do with APC brand of politics. If you accuse people of massive thefts, rubbish them and force them out of politics in the most crude way imaginable and then keep heaping abuses on them when they leave office, do not be surprised if they work against you consciously or unconsciously.
When Jonathan left office, he did not just go into oblivion. He became a global superstar for his democratic credentials in Africa. Those that worked with him landed lucrative jobs. Adesina became president of African Development Bank. The former SEC boss, Arunma Oteh, became World Bank Treasurer and Vice President, Ngozi Okonjo-Iweala became a kind of roving financial ambassador with lucrative jobs. She is a personal friend of the IMF President. They all, including the Chinese, saw Jonathan’s extreme success in making Nigeria the top destination for Foreign Direct Investment in Africa.
If you think that financial markets are not seeking the advice of these financial gurus, you don’t know the politics of international finance. You cannot rubbish Adesina’s agriculture revolution then go later to ask for money from him. He will pretend to be professional but a human is still a human. The IMF President will seek Okonjo-Iweala’s advice. What do you think will be the answer? The World Bank will ask their treasurer and vice president, “Should we lend?” What do you think Oteh will she say? A woman who was roundly abused and whom Buhari scorned and refused to congratulate when she got her appointment? Only her body language, would say it all.
The Chinese who enjoyed working with Jonathan, told Buhari he must stick to the agreements with Jonathan. Buhari who had scrapped the Lagos-Calabar Railway project now had to find a way to get it into the 2016 budget in the hope of still getting that loan, that cash.
3. Buhari’s growing reputation as an Islamist Extremist, is making the world wary. The killing of Shi’ites has established him in the eyes of the world as an extreme Sunni ideologue. They all remember Al Bashir of the Sudan and his Janjaweed. Buhari is exactly following Al Bashir route, smiling to the West whilst, allowing a dangerous Fulani Militia to flourish.
4. More than anybody else in destroying Buhari’s reputation is Nnamdi Kanu and IPOB. Yet, Buhari is so foolish and flexing empty muscles when his reputation as a mass murderer is being propagated worldwide ensuring no one will lend him money. At least not in the West.
Buhari is personally the problem.
If international financial houses are pulling out they are doing so because of Buhari.
If foreigners are afraid of investing in Nigeria, an attractive market, they are avoiding us because of Buhari.
If no one wants to lend us money they are refusing because of Buhari.
If China’s life saving Yuan offer does not work, then it is because of Buhari.
If there is no petrol it is because Buhari thinks he can order marketers to sell at his price.
If there is no light it is because pipelines are being blown by angry young men furious at Buhari’s Niger Delta policies.
If naira is falling it is not because of Emefiele, it is because of Buhari artificial two-tier round tripping forex to favour family, friends, and the Fulani.
The killings ongoing across Nigeria, can be associated to Buhari by acts of omission, commission, and the famous body language. Since he came to power the Fulani militia operate with shocking impunity. All these drive away investors and lenders.
Focus on the issue, not the symptoms. The person who creates the problems cannot solve the problems.
Buhari is the problem. Wise up Nigerians and get rid of your problem.
Agha Egwu is a political activist. Connect with him on Facebook.
The opinions expressed in this article are solely those of the author.