PRESIDENT Bola Tinubu should walk his talk that the Nigerian economy can only grow when the private sector is in full control. Seeking the support of the organised private sector when he hosted the members to a Ramadan dinner in Abuja recently, the President acknowledged that he could not succeed without the OPS. From the way Nigeria has mismanaged state-owned enterprises since flag Independence 63 years ago, Tinubu is saying the obvious. With a background in the private sector, he must be strategic in encouraging a full private sector-led economy.
The economy has been a mixed bag in the Fourth Republic. While President Olusegun Obasanjo took some steps to privatise some SOEs, he stopped short at critical moments.
His successor, Umaru Yar’Adua, immediately reversed the last-minute sale of the refineries in Port Harcourt and Kaduna to the Blue Star consortium. It is a major setback. Subsequently, Nigeria, Africa’s largest crude oil exporter, shamelessly imports petroleum products at a great cost to its economy.
Goodluck Jonathan, who should have re-implemented the privatisation of the refineries, looked the other way. To his credit, he sold the power generation and distribution companies in November 2013. The sales were however opaque.
In came Muhammadu Buhari, notorious for his statist bent during his first tenure as a military head of state (1984-August 1985). Privatisation stalled.
In Nigeria, government ownership of business does not yield results. Electricity generation is at 5,000 megawatts, no steel production, petroleum products are imported, and the seaports and airports are in a shambles.
To reverse this – as has been done across the world to a great success – is the task before Tinubu. He can do it. “If the private sector is not flourishing, there is no growth, prosperity, employment, or development,” Tinubu said. “No matter how flowery the speeches are, not even a mushroom will grow.”
This is the crux of the matter. Tinubu should dust off the privatisation documents prepared by the Bureau of Public Enterprises and improve on them. The priority areas are obvious. Under government control since inception in 1979, the Ajaokuta Steel Complex has not taken off. That is absurd, as Nigeria’s annual steel imports amount to $4 billion. The President should stop wasting resources on it and sell it off transparently, giving Nigeria a base for industrial take-off.
Another area is the four refineries. Nigeria’s monthly petrol imports was N843 billion in 2023. Another estimate put the annual petrol imports at $28 billion. This is not sensible when Nigerian can shore up its crude production and refine for domestic consumption and export.
The United States owns no public refinery despite being the largest crude producer in the world. These days, Saudi Arabia owns refineries in the US. The Dubai Ports World manages more than 20 US seaports. Although we acknowledge efforts to revive the refineries, they are better run by the private sector. Tinubu should not delay this.
The other SOEs that deserve the same treatment are the seaports, the airports, and the Transmission Company of Nigeria. The Federal Government should water down its stakes in the privatised electricity assets.
Back in 1979, the late British Prime Minister Margaret Thatcher, had blazed the trail with a privatisation programme that included the sale of British Airways, British Gas, British Airport Authority, British Rail, British Petroleum, London Bus Services and several others.
Therefore, Tinubu should make good on his talk. Privatisation should be revived as a key government policy. This will ensure that the OPS runs the commanding heights of the economy, creating jobs and paying taxes. This will enable the government to build infrastructure and increase votes to social services.
The Tinubu administration should perish the thought of establishing more SOEs, especially an airline, which Buhari diabolically pursued.
