Home Features The Week Ahead – The Voting Has Already Begun

The Week Ahead – The Voting Has Already Begun

294
0
SHARE

Voting booths open across the country in 176 days for what will be a fiercely contested national popularity contest. Some constituencies, however – IPOB sympathisers, foreign capitalcredit-seeking consumers, the global oil pricejihadists and the country’s richest oil state – have got a head start on the rest.

Rivers as the theatre of dreams

The Independent National Electoral Commission (INEC) suspended the by-election for the Port Harcourt Constituency III State Assembly seat held on 18 August. Obo Effanga, the Resident Electoral Commissioner (REC) in oil-rich Rivers State, who announced the suspension in a terse statement late on Saturday night, cited widespread violence as reasons for the suspension. The bye-election was conducted by the INEC to fill the vacancy left by former state Assemblyman, Victor Ihunwo, who ran for and won the Port Harcourt mayorship. Mr Effanga stated that because the exercise was marred by widespread violence, it was suspended in accordance with Section 26 of the Electoral Act 2010. He did not give a new date for the by-election.

As one of the richest states in Nigeria, Rivers is a major electoral prize. Since the Second Republic, it has always tended to be part of the ruling party’s electoral coalition. Thus, the current situation in which Rivers is an opposition state is something of an aberration. Ahead of the 2019 elections, this latest electoral violence raises concerns regarding a number of issues, notably the willingness of political actors to restrict their contest within legal bounds, and the capacity of state agents to prevent electoral violence or at least prevent it from having a disruptive impact on polls. On the basis of this week’s events, the auguries are not positive. It is significant that thugs were still able to disrupt the election despite the deployment of 1,500 policemen. Rivers will be one of the battleground states in the next year’s elections and there is a reason to suspect that this will be both a literal and a figurative descriptor. The rivalry between the incumbent governor Nyesom Wike and his predecessor, Rotimi Amaechi, now Minister of Transport, is a matter of public record. As is typical of politicians in his position, Amaechi will consider it a personal affront if the ruling APC fails to win in his home state. For his own part, Governor Wike’s pursuit of a second term constitutes more than sufficient motivation for him to ensure that Rivers remains under the PDP’s control. The PDP will look to preserve control of a traditional domain while the APC will seek to capture new territory in a region where it is unpopular. This cocktail of factors suggests that Rivers will be one of the theatres of a political contest that will not be for the fainthearted. It should be closely watched in the months leading up to the election.

The FG’s perilous Islamist dilemma

At least 19 people were killed in an Islamist militant attack on a village in northeast Nigeria in the early hours of 19 August, according to eyewitnesses and survivors. The militants attacked the village of Mailari in the Guzamala region of Borno at around 2 a.m, news reports quote survivors. They said it was not immediately apparent if the attackers were Boko Haram insurgents or belonged to the Islamic State in West Africa group. The Sunday attack came two days after four farmers were killed by Boko Haram operatives just Maiduguri, according to the AFP. On 17 August, around a dozen Boko Haram Islamists riding on motorcycles stormed crop fields near Ali Goshe village, 6km outside the city and slit the throats of the farmers. The attack on civilians comes as jihadists are launching a surge of assaults against troops in Nigeria, putting the military on the back foot six months before presidential polls.

While it is uncertain as to whether these attacks were carried out by Boko Haram prime (Abubakar Shekau’s faction) or Islamic State West Africa Province, ISWAP (the faction led by Abu Mus’ab al Barnawi), the mode of the assaults suggest that the former was responsible. ISWAP has reportedly forsworn Shekau-esque attacks on civilians in favour of more direct and targeted attacks on the military and other state authorities. Indeed, Shekau’s indiscriminate brutal attacks on civilian targets, including Muslims and mosques, have earned him stern censure from Islamic State and al Qaeda and was also one of the reasons for the schism with al Barnawi. ISWAP is believed to favour a more strategic approach that involves winning the hearts and minds of the civilian population and reserving aggression for those it considers enemy combatants, namely the Nigerian military and other security agents. In any case, these attacks also highlight the complexities of the operational realities in Nigeria’s northeast. The factionalisation of Boko Haram may have weakened Shekau but it also now means that the Nigerian state is confronting at least two highly motivated insurgent groups. The killing of civilians will also deplete public confidence in plans for the return of internally displaced persons to their communities despite the government’s continuous assurances of their safety. The recent reversals suffered by the army and the renewed vulnerability of civilians suggests that such safety is a long way from being guaranteed.

Eating and having your law on IPOB

A magistrate court in Owerri, capital of southeast Imo State on 20 August remanded at least 112 female members of the proscribed Independent People of Biafra (IPOB) in custody. The women, who were arraigned on eight-count charges, were arrested in Owerri by the police on Friday while they were on a protest demanding that the federal government produce its embattled leader, Nnamdi Kanu. Mr Kanu is wanted by the Nigerian government for alleged treason. He has not been seen in public since September 2017 when the army raided his home in Umuahia in neighbouring Abia State. His whereabouts remain unknown.

It smacks of the most tragi-comic kind of irony that the Buhari administration who has paid scant fidelity to the rule of law by not offering a proper explanation for the events surrounding the raid on Mr Kanu’s home and his subsequent disappearance almost a year ago, despite the pendency of a court case against the IPOB leader and the protestations of his lawyer and family is seeking to enforce the law (in the courts) against peaceful protesters. The FG’s challenge with managing a nascent but vocal separatist cause in parts of the country’s southeast is largely one of its own making. Engaging with interested actors in the region. Pursuing an ‘eat your cake and have it’ strategy will yield little dividends when consistent socio-political engagement with regional actors and expanding economic opportunities are more sensible options

An extended period of commoditised growth

The statistician-general, Yemi Kale, says Nigeria’s economy has not recovered from the 2016 recession. Speaking on an Arise TV programme on 18 August, Kale said the conflicts between farmers and herdsmen dragged down the country’s Gross Domestic Product in Q1 2018. “I am not going to give the final figure because the work is not even completed but from the numbers I am seeing, it is looking quite flat,” he said. However, Kale said the International Monetary Fund’s projection that the economy will grow by 2.1 per cent by the end of the year is achievable.

This is not surprising given the trend in non-oil GDP even as overall GDP growth became positive. While the recovery in oil prices from 2016’s sub $30 lows back to as high as $80 has fueled the return to positive growth, it is not sufficient to drive the kind of growth that will lead to a meaningful recovery from the recession. This is an important point to make – commodity prices can only do so much, it is the policy direction of the government, and the trust it engenders to drive investments, that cause real growth.

Foreign capital casts a ballot

New data released by the National Bureau of Statistics on 20 August shows that the total value of capital imported into the country in the second quarter (Q2) was $5.5 billion, 12.53 per cent lesser than in the first quarter (Q1) but an increase of 207.62 per cent from the comparable period last year. According to the bureau, flighty portfolio investors accounted for 74.7 per cent of imported capital. It also released a new report on the same day which showed that Nigeria’s banks increased by 12,253 in Q2, of which 11,942 were employed on temporary contracts. According to the Selected Banking Sector Data report, overall bank staff strength increased from 89,608 to 101,861. Companies often prefer contract staff to full-time staff because they would not have to pay contributory pension or insurance claims for them. This means that the cost of employing full-time staff is higher than the cost of hiring contract staff.

Trade balance (or capital importation) represents the difference between exports and imports, and for Nigeria, is driven by crude oil exports (more so considering the elevated oil prices). Historical data has shown that there is a direct correlation between trade balance, GDP growth, foreign reserves and manufacturing PMI – all of which rose between Q4, 2017 and Q4, 2018. However, due mainly to increased yields in developed markets and rising geopolitical tensions around the world, institutional investors have been withdrawing their funds causing a fall in developing equity markets. We forecast that lingering political uncertainty ahead of the elections will see capital flight continue in Q3, leading to a continued price decline in the equity market and a depletion of external reserves as the central bank continues its Naira defence policy.

Building a credit and lending culture

The online lending platform, Paylater, will start sending credit reports to new loan applicants “to increase awareness about data that is used in the lending decision and provide an opportunity to improve their creditworthiness.” The initiative is aimed at providing readily accessible data on consumer lending and spending patterns, something which is not easily available in Nigeria.

This is a good way to create an incentive for Nigerians to repay their loans, as they will see how repayment behaviour improves access to future, larger and better-priced loans. With more credit history data in a country where there are no credit scores, good borrowers will have access to larger, cheaper credit and lenders will have lower default rates. We believe that this is going to be one of the more important drivers of financial inclusion.

LEAVE A REPLY

Please enter your comment!
Please enter your name here