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STAY THE COURSE
...AND ECONOMIC PROSPERITY WILL FOLLOW!

...Mixed Bag

igeria has been going through quite a bit of topsy-turvy lately. The first quarter of 2006 was marked by a mixed-bag of events. Two hostage crises in the Niger Delta and religious riots in the North and Eastern parts of the country made the newswire, dwarfing a lot of other more comforting economic events like the historic debt deal, banking reform/liberalized exchange regime, assignment of (BB minus) sovereign credit rating etc. The IMF in one of its recent reports, indicated that thanks to robust emerging markets, foreign remittance and on-going reforms within the continent, capital flow has been on the upsurge as growth forecast is poised to surpass the 5% mark over the next few years.

Nigeria has set a long-term goal of growing its economy at 10% or more annually and becoming one of the 20th largest economy in 2020. Incidentally, earlier this week we learnt that Nigeria would be the first Africa country to become debt-free from the Paris Club of Creditors, upon payment of the second installment of the $12 billion deal. These might all sound frivolous to critics and perennial skeptics. But the ray of positive outlook is better than the roller-coaster the country has experienced in past decades and could suggest that the economy is on the mend.

...Mad House
During an earlier congressional testimony, Mr. John Negreponte - US Director of National Intelligence warned that an attempt to seek a third term by President Obasanjo might result in dire consequences for the country. Soon after, Senator Barak Obama, New York Times and a California tabloid newspaper all joined the chorus of soothsayers. Meanwhile there is a groundswell of opposition at home against the constitutional amendment, with some politicians promising fire and brimstone should the so-called third-term agenda sail through. Quite frankly, I have become accustomed to doomsday prediction of the intelligence community and often take it with a grain of salt, especially as history has proven the contrary in several regions around the world.

They never seem to get things right before it happens or often exaggerate the obvious. It all boils down to intelligent guessing. The velvet revolution early 1990s in Eastern Europe (Czechoslovakia, and Romania to be exact), genocide in Rwanda and ethnic cleansing in Bosnia unfolded under everyone's nose, yet they didn't see it coming. Soviet Union's collapse was greeted with all sorts of catastrophic predictions that never materialized. The British House of Lords in their deliberation about Nigeria's situation took a more cautionary look at things preferring to leave it in the hands of "Nigerian people". The crux of the matter is that after such a tumultuous history, Nigeria has come to stay and needs to remain focused on its problems to survive and thrive.

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The clamor to become the next president seems to be overshadowing more serious and substantive issues for the common man. The effect of over 30 years of military mismanagement is written all over the faces of poor citizens, whose lives have been rendered hopeless. Affording "one good meal" a day in the current environment is a tall order, yet all we hear is the hue and cry for or against third term - what an errant nonsense.

Not to minimize the role of politicians in any democratic dispensation, I'd argue that there is a clear-cut misplacement of priority in Nigeria.

Democracy cannot be built or thrive on an dry patch. Given the current conditions in Nigeria, unless the lot of the people is drastically improved fast, real power would continue to elude the electorate and rest in the hands of few political opportunists who will consistently manipulate the society.

...Historical Lessons
The events of the last seven years at least has set in motion a process, albeit slowly, that would bring about long-term stability, if only Nigeria can stay the course. Does anyone sincerely think that the man on the street cares about third term, if he can't afford to eat? Come to think of it, the political elites creating this whole buzz are well-off. My case is simple - that economic prosperity is a long hard road, which can be achieved only through disciplined and sustained transformational process. At the end of the day, it won't matter who the president is or where he comes from, if people can be well taken care of.

The fortunate reality is that the center of gravity seem to be fast shifting in Nigeria and the economic terrain is transforming quite rapidly in such a way that erstwhile privileged elites are loosing ground and therefore putting a strong fight to sustain the status-quo in the name of democracy - change is a natural process my friends. Nigeria's situation will be no different than other countries around the world - like Turkey during the early 20th century when Mustafa Kemal Ataturk, successfully eliminated the over-bearing influence of religion on the state by creating a secular society thereby setting Turkey on the path of modernization.

Russia during the reign of President Boris Yeltsin in late 1980s/early 1990s offers another vivid example. Despite being a former communist himself, he successfully dismantled the hegemony of corrupt and parasitic communist bureaucrats, fended off their spirited opposition and initiating one of the most radical socio-economic reform measures in modern times - not a perfect one for that matter. That process resulted in the ascension of Mr. Putin to office, who is still finishing the job. Today Russia has become a member of the exclusive G-8 club of wealthiest nations and still wielding authority as a major player in global geopolitics.

...Staying The Path
The task ahead of this administration is onerous, given the depth to which the country has sunk over decades. Whether this administration could deliver Nigeria to the "promised land" is early to say, but you must agree that it has undoubtedly set the ball rolling. Fight against graft and influence peddling, fiscal discipline and radical reforms have led to recent gains in the economic front both domestically and abroad.

To illustrate one of the ironies - as the country remains embroiled in a heated debate on whether or not it would survive as an entity, Kuwaiti based MTC/Celtel Group is forging ahead with its $1,0 billion acquisition of V-Mobile. China just got the nod to invest over $2,0 billion in the oil industry - yes you might say everyone wants our crude oil. In a series of recent meetings with financiers in Europe, the re-occurring theme was - what deals are there in Nigeria? Am quite sure other players in the industry share this growing sentiment, which to me are tell-tale signals of better times for the economy in particular and the populace ultimately.

...Not Yet Uhuru
It's not yet "Uhuru" (free and home safe) for the common man as they say in Swahili, but the reform process must continue, albeit with constant modifications and review. There is simply no alternative. The experiment of military rule on the guise of fighting corruption was all baloney that has led the country no where. It is natural for the opposition to aspire to power and there's no way to know if someone could do better until given the opportunity. My conviction is that the agitation should be within the ambit of law and through political dialogue like in other civilized societies. The plain truth is that Nigeria has gone beyond the stage of policy experimentation. The citizens cannot remain "guinea pigs" on the altar of extremist political brinkmanship. What we need now, is a committed, strong, disciplined and visionary leadership at all levels that could deliver the barest life minimum of clean water, electricity, affordable housing, decent infrastructure and security - those are true attributes of a virile and stable democratic society. Only by staying the course of market reform and rule of law can that be achieved - who leads that process is irrelevant.

Chamberlain is the Founder & President of New Era Capital Corp. and MyCompleteFinance.com, a New York based financial services group. He was previously a Financial Advisor in the Global Private Client Group, of Merrill Lynch.