Sanusi and Western Economic Theories

When Nigeria’s Central Bank governor, Lamido Sanusi tried stampeding the federal government into removing fuel subsidy based mainly on some western economic theories, I had strongly criticized his action. Some even called me names. My argument was that no nation should make the mistake of swallowing any western economic theory hook, line, and sinker. This was based on the fact that every nation- especially the developed west has the dirty habit of sabotaging the economies of other nations in order to strengthen theirs. No doubt, this culture of “economic interest” has led to serious conflicts between nations. Economic interest was the foundational cause of the cold war between the former Soviet Union and the United States. Even with the collapse of communism, the “economic war” has not ended. The battle now is between Beijing and Washington. It is surely about economic interests. It would therefore be suicidal for any nation to follow western
institutions blindly like most western trained economic and financial experts do.

In one of my books, “Western Democrats in Glass Parliament” (http://i-proclaimbookstore.com/wedeinglpa.html), I have argued that the International Monetary Fund (IMF) and World Bank are all instruments used by western countries to destroy the economies of weak nations so as to have them (developing countries)rely on the developed west for everything, including political leadership. The developed nations are known to have deliberately used international institutions to mislead African governments in the near and far pasts to economic policies that are mostly aimed at subtly breeding poverty and socio-political tensions. The Structural Adjustment Programme (SAP), frequent calls for the devaluation of national currency, and pressure to withdraw fuel subsidy are a few examples. Unknown to many African governments, most developed countries in the west still subsidize
critical sectors of their national economy. For instance, agricultural subsidies alone accounts for more than 40% of the total budget of the EU. This has not only helped the agro-allied sector to grow; it has equally promoted food security in the EU. The message here is that, subsidy is not as bad as is being painted by the IMF and World bank here.

One cannot understand why Lamido Sanusi would close his eyes and ears to the weak purchasing power of the average citizen and pressurize the Nigerian federal government to withdraw fuel subsidy simply because western economic theory support its removal. Apart from his argument that a few persons in the petroleum industry were abusing the subsidy regime, he had also revealed that some marketers were taking advantage of the high cost of petroleum products in neighboring countries to smuggle petrol, thereby creating scarcity. As far as I know, it is not yet a crime for the price of fuel in a country to be
cheaper than that of neighboring countries. Going by the arguments of the CBN, it is like asking the mostly poor Nigerian populace to pay heavily for the “sins” of security agencies and other corrupt officials in the nation’s petroleum industry. Before now, the CBN has been quick to compare the cost of petrol in Nigeria with those of the United States and other western countries.

Often times, the leadership of the CBN and other formulators of the nation’s fiscal policies forget to remember that Nigerian workers are not earning the equivalent of what their contemporaries in the developed west do. This is one good reason why the CBN or ministry of finance have no justification in comparing the cost of petrol in Nigeria and America, Canada, or Britain.

Many Nigerians were indeed glad when Sanusi Lamido for the first time, ignored the west by rejecting calls for the devaluation of the Naira. Not every economic theory can be applied to every similar situation. An economic policy that is successful in the United States may not work out the same way in Nigeria owing to different factors such as population, culture, technology, or purchasing power.

The CBN and other associate formulators of the nation’s fiscal policies must open their eyes and ears very wide. I do hope that the minister of finance, Olusegun Aganga is also listening. Western democrats are meeting in their glass parliament! Their aim? Ask the Russians, Japanese, and Chinese.