The Emergency Economic Stabilisation Bill, 2016: An Unnecessary Fifth Wheel to the Coach

On Monday, 22nd of August, 2016, The Nation Newspaper reported as follows: "President Muhammadu Buhari will be seeking emergency powers from the National Assembly to push his planned stimulus for the economy. The objectives of the action-plan on the economy, which is in recession, include shoring up the value of the naira, creation of more jobs, boosting of foreign reserves, reviving the manufacturing sector and improving power. "Government sources said the decision to seek emergency powers for the President was based on a proposal from the economic team headed by Vice President Yemi Osinbajo. The team reviewed the various policies so far introduced and how they have affected the economy. The economic team, it was learnt, gauged the mood of the polity and decided that unless there is an urgency which some of the extant laws will not permit, 'the recession may be longer than expected and Nigerians will not get the desired respite, which is the goal of this government'.

"An executive bill titled: 'Emergency Economic Stabilisation Bill 2016' is to be presented to the National Assembly when the Senate and the House of Representatives resume from vacation on September 12. In the bill, the executive will be asking for the President to be given sweeping powers to set aside some extant laws and use executive orders to roll out an economic recovery package within the next one year. Buhari will be seeking powers to:

“Abridge the procurement process to support stimulus spending on critical sectors of the economy; make orders to favour local contractors/suppliers in contract awards; abridge the process of sale or lease of government assets to generate revenue; allow virement of budgetary allocation to projects that are urgent, without going back to the National Assembly; amend certain laws, such as the Universal Basic Education Commission (UBEC) Act, so that states that cannot access their cash trapped in the accounts of the commission because they cannot meet the counterpart funding, can do so; and to embark on radical reforms in visa issuance at Nigeria’s consular offices and on arrival in the country and to compel some agencies of government like the Corporate Affairs Commission (CAC), the National Agency for Foods Administration and Control (NAFDAC) and others to improve on their turn around operation time for the benefit of business…

“The move to get government agencies to fast tract their operations is to enable foreign investors to come into the country without the current bottlenecks. Consular offices will now be expected to make visas available within 48 hours and visitors, especially tourists who intend to pick up visas at the entry point, will be able to do so. Time wasting at the airport with duplication of agencies screening incoming passengers is to be eliminated. Those leaving the country should go without hassle…

(Source: thenationonlineng.net, posted by Adeniyi Adesina on 22/08/2016)

The above summarises the government’s emergency approach to revamp our ailing economy. It is heartwarming that the Federal Government has at last admitted that our economy is in recession. Before now, there were denials, counter-denials and double speaks here and there on the true position of the economic reality of our country.

What purpose will the Emergency Economic Stabilisation Bill, 2016 achieve if passed into Law?

Without going into the specifics, it is commonplace that a lot of factors contributed to our present ailing economy traceable to historical antecedents. Before now, Nigeria was the third fastest growing economy in the world; and the fastest in Africa. But now it is not even among the first 15 fastest growing economies in Africa. The Vanguard Newspaper of 26/04/2016 reported that:

“Having enjoyed blissful growth over the past decade, Nigeria was one of the fastest growing economies in the world, but it is not one of the 15 fastest growing economies in Africa for 2016. In 2014 and early 2015, Nigeria was named the third fastest growing economy in the world by CNNMoney, with China and Qatar, taking the lead at 7.3 percent, 7.1 percent gross domestic product (GDP) growth. For 2016, however, the coast is cloudy, and Nigeria is nowhere near the fastest growing economies in Africa. According to the International Monetary Fund’s (IMF) World Economic Outlook for 2016, as revised in April, the fastest growing economy in Africa for 2016 is Cote d’Ivoire and the slowest is Chad, which is expected to record negative growth. Cote d’Ivoire is expected to experience an 8.5 percent rise in GDP, while Nigeria’s neighbour, Chad, would see a -0.4 percent growth. Cote D’Ivoire (8.5%), Tanzania (6.9%), Senegal (6.6%), Djibouti (6.5%), Rwanda (6.3%), Kenya (6.0%), Mozambique (6.0%), Central African Republic (5.7%), Sierra Leone (5.3%) Uganda (5.3%). Madagascar, Zambia and Chad are expected to see a growth of 4.1 percent, 3.4 percent, 3.2 percent respectively.

“The fastest growing economies in Africa by GDP growth rate, as projected by IMF for 2016, are: Cote D’Ivoire (8.5%), Tanzania (6.9%), Senegal (6.6%), Djibouti (6.5%), Rwanda (6.3%), Kenya (6.0%), Mozambique (6.0%), Central African Republic (5.7%), Sierra Leone (5.3%) and Uganda (5.3%). DR Congo expects a GDP growth of 4.9 percent, Cameroon; 4.9 percent, Ethiopia; 4.5 percent, Ghana; 4.5 percent and Republic of Congo; 4.4 percent. Madagascar, Zambia and Chad are expected to see a growth of 4.1 percent, 3.4 percent, 3.2 percent respectively. Major oil exporters, Angola and Nigeria, hard hit by the slump in crude oil prices, are projected to see a growth 2.5 and 2.3 percent. At 2.3 percent, Nigeria is expected to see its poorest GDP growth since the return of Democracy in 1999. This development has become a point of concern for the IMF, and the World Economic Forum (WEF)…”

A lot of negatives may play against the Emergency Economic Stabilisation Bill, 2016. The life span of the potency of the Bill which is to give the President one year to exercise the emergency economic power is not helpful. The President has a constitutional tenure of four (4) years. It took him about six (6) months to inaugurate his cabinet presupposing that he was in charge without any economy team, policy or blue print on ground for six (6) months. This has contributed largely to the economic recession. With the cabinet now on ground and fifteen (15) months into his tenure, the President is now seeking for emergency powers to revamp the economy within one (1) year. This is coming a bit late in the life of this administration. It seems the government has just woken up from its slumber and the reality is staring at it face on.

Will one (1) year be enough to revamp an economy that is in recession? What Nigeria needs now is a sustainable economic policy driven by a long-term plan with the revitalisation of a critical, systemic and institutional framework for economic growth. Will one (1) year of emergency powers be enough to build a sustainable economic policy? What happens to the economy after the expiration of the one (1) year? Does the President need any emergency power to shore up the value of the Naira, create more jobs for our jobless youths, boost foreign reserves, revive the manufacturing sector and improve power supply? The success of economic policy is not in its fire-brigade approach, but in the political will to sustain it. With political activities for 2019 elections around the corner, will this administration have the stamina to sustain the tempo deserving of the emergency powers?

The justification for the Bill according to the Economic Team is that, after gauging the mood of the polity it concluded that “unless there is an urgency which some of the extant laws will not permit, the recession may be longer than expected and Nigerians will not get the desired respite, which is the goal of this government”. The Economic Team further cited the Universal Basic Education Commission (UBEC) Act, Corporate Affairs Commission (CAC) Act, and National Agency for Foods Administration and Control (NAFDAC) Act as examples. These laws and others not cited here but contemplated by the Economic Team as constituting bottle necks in the efforts to revamp the economy have been there for quite a while. If they were there when Nigeria was the 3rd fastest growing economy in the world and the fastest in Africa, what is wrong with them now? Besides, if the Economic Team thinks something is wrong with them, we do not think the Emergency Economic Stabilisation Bill, 2016 will make them any better. A Bill for emergency power will not solve the problems embedded in an Act of the National Assembly by a sweeping executive declaration/order/fiat. What the Economic Team should do is to point out the bottlenecks in these Acts and send them to the National Assembly for immediate amendments.

This way, the bottlenecks are permanently done away with and the amendments become sustainable. After all, the process of, and procedure for amendment are not as cumbersome as those for the passage of a new Bill. Therefore, for purposes of economy of time and convenience, it is better and cheaper to amend a Law than to pass a fresh Bill into Law.

In approaching the National Assembly with the Bill, the President has to be wary of his powers and obligations under the Constitution on the one hand, and those under other extant laws. For instance, virement is a constitutional obligation imposed on the President under section 59 (1) (a) of the Constitution which will require a constitutional amendment to depart or vary it. The Bill does not have the legal competence to do that; only the Constitution can do that. Therefore, the aspect of the Bill that seeks to “allow virement of budgetary allocation to projects that are urgent, without going back to the National Assembly” is unconstitutional. However, in practice, it is acceptable for the President to do virements before sending them later to the National Assembly for ratification.

Does the President really need the approval of the National Assembly to declare a state of emergency and thereby exercise emergency powers on the economy? What is the purpose of the Fundamental Objectives and Directive Principles of State Policy enshrined in Chapter II of our Constitution? All the powers and everything that the President, as the Chief Executive of the Federal Republic of Nigeria, needs to revamp our economy are contained in the Constitution and other extant laws in that respect.

Approaching the National Assembly to grant him emergency power to revamp the economy will not, ipso facto, solve the problems or bring us back as the 3rd fastest growing economy in the world, or the fastest in Africa. The President needs the right people, the right mentality, the right character and the conducive environment for businesses and investments for both nationals and foreigners. A secured, crime-free and corrupt-free environment is a sine qua non to businesses and investments. Even if our visas are granted for free within 24 hours and our ports are wide open for foreigners to come in freely, that will not change anything as long as our country is riddled with security challenges, crimes, corruption, and systemic and institutional decay. These are critical areas begging for more attention. No foreigner will risk his money and life to do business in Nigeria in such an environment. And, happily, the President does not need emergency powers to address all these problems.

If ultimately the Bill is passed by the National Assembly and the emergency powers sought are granted to the President will that guarantee the rehabilitation of old roads and the construction of new ones, the stability of power supply, the creation of jobs and gainful employment for our youths, the creation of wealth, the eradication of poverty and hunger, the improvement in the health care delivery system, the success in crime fighting, the improvement in the security situation, the development of Nigeria from ruralisation to urbanisation, the balancing of the Naira against the Dollar in the foreign exchange market, the success in the war against corruption, the improvement in the country's economy, a working system in the country, etc? These problems will require a meticulous and well-articulated economic plan by bringing in the right people, with the right mentality, the right character and the creation of the conducive environment. These cannot be achieved through the exercise of emergency powers.

The grant of emergency powers in a democracy like ours to solve economic problems may be exercised in a totalitarian, dictatorial and tyrannical manner thereby subjecting it to misuse and abuse. It may also be evidence of a dearth of managerial and administrative resources to contain and solve the problems.

When desperate measures are used to tackle desperate situations, we should expect desperate results.

James Kanyip