BPE and the Nigerian Nation
By Anthony Akalugo   Newsdiaryonline Tue Sep 13,2011

The Bureau of Public Enterprises, BPE, means many things to many people.  To some, it is that monstrous creation of the Structural Adjustment Program (SAP) (initiated by Gen Ibrahim Babangida) during his military rule, 1986 – 1993. The proponents of the enterprise concern could go on to list a litany of theoretical benefits it promised to provide to the economy if it were implemented.

Some other schools of thought would view it as an orchestration by the rich to further fasten their grip on the economy and widen the gap between the rich and the poor citizens of the country. Ploys to sale off the public enterprises to themselves directly or through their proxies.

From any angle anyone decides to view it, there seems a point of convergence. The convergence remains that something ought to be done to move the system forward.

From the perspective of the supposedly powerful rich, something could be done to improve operation and inflow, though; it may not be intended for the generality of the citizenry. To own and dictate the pace of economic growth is to say the least a preserve of the few. The ABC principle of 20% minority dictating for other 80% gullible citizens becomes the norm.

While to others, the projected returns from such huge investments are hoped to be plowed into providing infrastructure and creating investment friendly climate, but the dream has remained a farce. The consensus therefore is that something needs to be done but in what direction.  Inclinations therefore differ, especially as has been revealed at the senate probe panel.

Tracing the history of enterprise evolution in Nigeria, Socio Economic Rights Initiative (SERI), during a power mapping roundtable discussion stated that

“The participation of the state in enterprises in Nigeria dates back to the colonial era. The task of providing infrastructural facilities such as railway, road, bridges, water, electricity and port facilities fell on the colonial government due to the absence of indigenous companies with the required capital as well as the inability or unwillingness of foreign trading companies to embark on these capital-intensive projects.

Throughout much of the twentieth century, there were three dominant strategies for infrastructure investment. In some countries, most notably those in the Eastern bloc, state ownership of the means of production was promoted, while others (western bloc) promoted private ownership of the means of production. A large number of countries also practiced what was termed a mixed economy i.e. a combination of public and private ownership of the means of production.

However, by the end of the twentieth century, with the end of cold war between the eastern and western blocs, private ownership of the means of production gained ascendancy. Today, the received wisdom is that the state should recede from this role, and that private ownership of the means of production is the only viable approach to the efficient production of goods and services, as well as economic growth and development. Consequently, there is a move all over the world to privatize erstwhile public enterprises.”

This is the driving principle for the privatization of public enterprises in Nigeria, hence, the emergence of the BPE. 

Privatization means the process of transfer of government owned investment to private owned. The process may be conducted through various procedures such as outright sales of equity, lease or concession, liquidation, etc. In any case, the process of privatization involves the timely interconnect of various professional activities needed to engender frugality and to obtain the best offer and to the competent entity. For instance, there shall be timely publication calling for the bid.

The timing of the bid publication is expected to be at the best time when the transaction will receive the best offer (peak time). The evaluation of the property shall also be conducted by independent and certified evaluator. This activity node requires thorough and professional analysis of investment history, expenditure profile, returns on investment and the potential market, economic viability and depreciation. This activity node is not conducted by inexperienced appointee or political stooge, as has been evident in the several reports that have filtered from the BPE activities so far.

D.O. Adeyemi , at a review of privatization and Public Enterprises reform in Nigeria stated that “Public enterprises in Nigeria were established to propel socio-economic development and to guard against the control of the economy from foreign domination and exploitation. This accounts for why a larger proportion of the national budget has been voted for the creation and sustenance of public enterprises. In spite of this, the performance of public enterprises has been replete with varying contradictions. The public enterprises reform was an integral part of the Structural Adjustment Programme (SAP) in 1986” though the Act establishing the BPE and NCP was enacted in 1999.

Public enterprises in Nigeria were established to propel socio-economic development and to guard against the control of the economy from foreign domination and exploitation. This accounts for why a larger proportion of the national budget has been voted for the creation and sustenance of public enterprises. In spite of this, the performance of public enterprises has been replete with varying contradictions.

Since the enactment of the Act establishing the National Council on Privatization and the Bureau of Public Enterprise, BPE, in 1999, the appraisal of the success rate so far reveals a masquerading cacophony of inherent greed and insincerity.  

According to Senator David Mark, the essence of the privatization was that fund would be available in other sectors and then, make the companies more efficient because individuals tend to run companies better than government and the belief that as a result of that, there would be employment by those companies and it would aid national economic growth and development. This thought has been ambushed by just a few. It therefore leaves the youths in joblessness and makes them ready tools for manipulations. Nigeria has remained a rich nation with palpable degree of poverty stricken citizenry.

How much of this target has been realized today? Instead of the realization of the goal of privatization, we witness a deluge of altercation among the past leaders, calling themselves names. Incidentally virtually all of the past leaders will boast of introducing initiatives to change the economy in their respective times, as IBB and OBJ will claim. Even other leaders such as other past presidents, ministers, governors, etc, at various levels cannot boast of creating institutional framework to run economic initiatives without undue interference. Had they tried to establish independent institutional framework upon which such initiatives would run, they would not have been free to engage in any underhand manipulation of the institutional activities. The BPE report is a case in point.

We have never suffered dearth of ideas in Nigeria rather we continuously suffer from poor institutionalization which would have been a platform to create independence of human interference and allow for healthy competition. The failure of our leaders to be futuristic is the cause of our present economic and social woes manifesting in endemic distrust of the citizenry.

Interestingly, none of the past leaders who have come to expose shoddy deals of others has the singular motive of setting records straight owing to a genuine desire to right national wrongs but instead, to develop a cosmetic identity by playing to the gallery of hapless and gullible Nigerians. I am sure that Nigerians know better now than before and will not be easily swayed to become political puns in the hands of moral-stricken elders.

 If my hoping to attain the septuagenarian age is to perpetrate repugnant crimes against humanity and to rape the nation, then I sincerely pray not to reach that age. Aging can only be graceful where we create legacies of enviable identity.

The nation is worse-off not only because of the privatization policy but the poor institutional orientation of the leaders. The need to privatize stems from the fact that governments the world over do not possess the technical and human capacities required to run enterprises efficiently and profitably compared with the private sectors.

To have recognized and accepted this is a huge step in the right direction. Nigeria will be better with transparent and efficient privatization, commercialization, monitoring and evaluation of the performance of the privatized institutions. It is not enough to privatize and award to the bid winners. What becomes the major benefit to the nation is the post privatization performance. The privatization project MUST impact positive economic growth, an exercise that plays a central role in the economic dictum of the nation.

However, the problem with our nation is that we have leaders and potential successors of the present leaders who are educated but lack basic knowledge of the interplay of economic principles. They rather view every economic issue from political gains, claiming that all appointments should be rewards to their political support evidenced by maneuvering and subversion of the popular wishes of the masses.
In developed societies, such as USA, UK, France, etc, there is the emphasis on knowledge that translates to positive changes which is holistic and all encompassing. Appointments based on political leaning are only secondary while the primary consideration is based on holistic competence. But the knowledge base of many leaders in Nigeria is disconnected and stand-alone. Indeed Nigeria is besieged with a crème of leadership that lacks finesse.

It thus leads to the unguarded and uncontrollable quest to grab at all costs, no matter the shame. The more you widen the gap between the rich and the poor, the higher the potential difference, a catalyst for uprising and assassination. You will surely become a target of the oppressed.

Choices that are inconsistent with requisite competence and principle of competitiveness are not profitable in its nature because for us to move forward there must be the seamless interface among distinct bodies of knowledge, directed at achieving the common goal of development. Only the skilled can synchronize such tasking duties.

An attempt to perpetrate their greedy grip creates insecurity through agitated minds and the retinue of their security details often becomes the sacrificial lamb. Often times, an attempt by some disgruntled individuals to inflict pains on those they feel have tortured them in inestimable ways lead to loss of innocent lives.

The Bureau of Public Enterprises and the National Council on Privatization was established by the Privatization and Commercialization Act 1999.

The Act is premised on the assumed ethical know-how and compliance to transparency and the cost effective management of economic factors. Incidentally, the depth of competence required to pilot the Privatization agenda is stipulated in the PUBLIC PROCUREMENT ACT, 2007, Disposal of Public Property (Part x, Section 55 - 56). Though the PPA 2007 Act is recent, the framework for transparent and competitive conduct was provided for in the Due process guideline which was in use during Chief Obasanjo’s first tenure, 1999 – 2003.

First we must recognize that the latent but indisputable cause of the failure of the privatization exercise is the politicization of the appointment of the principal officers as against consideration for competence. How many of the appointees have demonstrable qualifications and experience in procurement and asset disposal? How many can boast of requisite knowhow as a prerequisite for their appointment other than the fact that they were backed by a strong godfather in the polity?

We have continued to disregard the noble call to apply ethical discipline in handling public issues in Nigeria. Incidentally, there is hardly a past leader in Nigeria that possesses impeccable records to serve as a role model to the youths, unlike what obtains in working democracies round the globe. This is because of willful perversion of procedure for selfish aggrandizement.

Daily, we continue to witness insurgence occurring in different hues and devastating climes around the country. Security of the nation has been severely threatened through the actions of Boko Haram, Militancy, Ethnic militia such as Massob, Mossob, OPC, etc. Have we attempted to establish the root cause of the sudden rise to take up arms against ones beloved nation?

Has anyone attempted to evaluate the passion Nigerians demonstrate whenever we play any football match with another nation? Off course, most of the attacks do not occur when Nigeria wins crucial football match, thus demonstrating our natural love and concern for our beloved nation. But the leaders have succeeded in separating the majority of Nigerians from the true love and expectation they were born with. The attempt to vent anger arising from frustration leads to unpleasant consequences such as bombing, kidnapping, armed robbery, hired assassination, etc. the present revelations of the BPE probe reveals a catalogue of rape on the nation perpetrated by those who have assumed ownership of the geographical enclave, Nigeria. Incidentally, the continued perversion of the rule of law and due process in this country further distance Nigerians from the constitution developed for the geographical region into a feeling of dejection, resentment and loss of confidence in national agenda. Without the rule of Law, the constitution is a mere literary work articulated to enrich libraries.

The President, Dr. Goodluck Jonathan has stated that the new foreign policy of Nigeria must be investment focused. This is long expected. The USA and the western nations have long entrenched that perspective in their foreign policies and this informs their participation in peace missions and intervention agenda for global peace. But Nigeria has never marched their global peace intervention initiative with investment plan.

It is also important to note that the government has demonstrated willingness to involve indigenous investors in key economic committees such as the appointment of Alhaji Dangote into the National Economic Management Team.

The privatized investments need to be up and running to produce the goods and services expected of them thus reducing our dependence on importation of goods and services. It will also create job opportunities and reduce the pool of idle youths. In addition, it is also to serve in the government’s new foreign policy drive. This is because Nigerian investors need to consummate bilateral and multilateral relationships through credible investments. It is only an enterprise that has demonstrated viability that will be guaranteed by the government in foreign countries for investment and bilateral cooperation.

We cannot continue in the same order of insensitivity but to turn and imbibe transparency in our conducts in all spheres, especially the consideration and management of the privatization and commercialization agenda of the government.

BPE needs to be entrusted into the hands of supply chain experts, who were trained, qualified and are conversant with the Nigerian economy. This is the only way the BPE will achieve its mandate of repositioning public investment management and encouraging Nigerian investors. If we can get it right at BPE, we will be able to rediscover and revive the confidence of Nigerians in the Nigerian project, thus, BPE and the Nigerian Nation.

Anthony Akalugo: holds Masters Degree in Transport Management, Logistics, PGD in Transport and Logistics, Bachelor of Technology Degree, B.Tech, in Maths and Computer Science, member of Chartered Institute of Purchasing and Supply Management of Nigeria, CIPSN, Nigeria Institute of Shipping, NIS,  Certified Institute of Shipping, CIS, Merchant Shipping Technology, MST, etc. He is the General Manager, Consulting Services at Daca Consults Limited, Lagos.

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