Okonjo-Iweala: In A League Of Her Own

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Okonjo-Iweala: In A League Of Her Own

 

By

 

Ijeoma Nwogwugwu

 

 

culled from THISDAY,  August 07, 2006

 

When the news broke of the President's decision to relieve the former Foreign Affairs Minister, Ngozi Okonjo-Iweala of her position in the Economic Management Team and of her oversight functions of managing the nation's foreign finances, I called a friend to enquire what could have led to this bizarre decision. Perhaps too astonished to make head or tail of the latest saga, he described the President's action metaphorically, calling it a death dance.
Seeing that his remark was lost on me, he explained that the term, 'death dance' was used during combat situations to describe a soldier's body which continues to writhe in spasms for a few minutes even after life has been snuffed out of it. Better still, he asked me to imagine a headless chicken whose head had been cut off and yet kept prancing around before dropping to earth lifeless.


Still baffled by his macabre sense of reasoning, I kept wondering what the relationship was between Okonjo-Iweala's removal and a body whose motor neurons were working overtime. It was not until some moments later that it hit me full blast. What my friend was trying to tell me, albeit in the most morbid way possible, was that for the first time in the history of this country, we were witnessing the last gasps for life of a lame duck presidency.
What better way is there for a President on his way out of office to show that he can still flex those weakened muscles, even if it means cutting his nose to spite his face? Well, the President with a singular flex has left one in doubt as to who calls the shots in government. But in the process, has lost arguably one of the brightest members of his administration. 


Curiously, my friend, a highly regarded economist and public commentator on policy issues, has never been a fan of the former Finance, and later Foreign Affairs Minister. He has always limited her accomplishments to the utilization of our foreign reserves accumulated from the oil windfall to negotiate an exit debt strategy in exchange for a write off of a further $18 billion by the Paris Club. The debt deal he insists was not synonymous with debt forgiveness and was made possible by her connections in multilateral donor circles. 


To some extent he is right. Ngozi Okonjo-Iweala, through no extra effort whatsoever, has had the good fortune of being in charge of the nation's finances at a time when oil prices reached unprecedented highs and enabled the country amass oil revenues never enjoyed by previous administrations. Her tenure coincided with a time when the global economy had entered an expansionary phase, thus dragging the Nigerian economy along with it. Economic stagnation of the 1980s and most of the 1990s had given way to strong broad-based economic growth, with the large fiscal deficits, the financing of which inflicted devaluation, inflation and high interest rates, giving way to fiscal surpluses.


This placed Nigeria in position of strength to follow a path different from other African countries burdened with foreign debt. The country was not included in the list of highly indebted poor countries (HIPC) that were eligible for 100 per cent debt relief from official lenders, the International Monetary Fund (IMF) and the World Bank, due to its oil wealth. However, those countries were subjected to stringent conditions and long delays before they qualified for debt relief. Leveraging on Nigeria's comparative advantage, Okonjo-Iweala was able to negotiate an exit strategy at an accelerated pace because the country had the funds to partially pay off its creditors, who were happy to accept a smaller overall payment in return for cash upfront.


The huge payouts made to the country's foreign creditors, however, was not replicated back home. Nigeria's domestic debt under the former Minister remained largely unserviced with several local contractors compelled to lay off their staff over the non-payment of monies owed them by government. Her pursuit of fiscal prudence, on the back of advice from multilateral donor agencies, also led to a crack down on investments in capital projects through which jobs could have been created.


Ngozi Okonjo-Iweala, nonetheless, must be credited with her single-minded determination to introduce some measure of transparency to Nigeria's notoriously opaque finances. After decades of profligacy and financial mismanagement, Nigeria under her watch was able to save close to $40 billion, earning the country the unique (some would say dubious in the face of wide spread poverty and unemployment) distinction of owning the highest stock of foreign reserves in Africa today. The debt reduction, although obtained at a huge cost, secured the nation credit ratings similar to other emerging economies such as Turkey and Ukraine, and positioned it to source for funds from the international financial market under favourable terms. 
Her accomplishments garnered the former Minister several accolades at home and abroad, and gave Nigeria some respectability and clout in the international arena.  But her popularity was obviously causing some disquiet in government especially among those who felt she was assuming a larger than life persona and hugging the limelight. The adulation particularly by the international community and speculation by the foreign press after her redeployment would later contribute to her undoing.


As Finance Minister, Okonjo-Iweala had to fight battles on several fronts some of which set her on a collision course from the get go with her boss, the President, soon after her appointment. Chiefly, she had threatened to resign over an attempt to remove the Budget Office from the Finance Ministry, and even later attempted to bring the National Planning Commission under her purview. The only thing that saved the Commission from being subsumed was the resistance put up by Charles Soludo who was Chief Economic Adviser to the President at the time. Never did she imagine that her determination to align all the institutional structures associated with macro-economic planning and management under one department would one day come back to hunt her.
When she was redeployed more recently to the prestigious, although less influential Foreign Affairs Ministry, the President allayed concerns by keeping her in charge of the economic team and the management of international finances. Ironically, the monumental decision to segregate the management of the economy now threatened to dismantle the very structures Oknojo-Iweala had justifiably fought to keep under her control three years earlier. It was a costly miscalculation on her part to have thought that her successor, Esther Nenadi Usman (now a full cabinet Minister) would stand idly by and allow her to hive off functions that traditionally reside with the Finance Minister.


If there is anything the saga leading to Okonjo-Iweala's exit has taught us, it is that no one is immune (including the most revered of technocrats) to the high wire politics that often takes place in government. If it could happen to Colin Powell who was once considered a possible contender for President in the United States by conservative Republicans, and yet was still cast aside as Secretary of State by President George Bush at the beginning of his second tenure in 2005, then it can happen to anyone.


Irrespective, Okonjo-Iweala's legacy as Finance Minister is assured. Her achievements both individually and collectively as a key member of the Economic Management Team has seen to it that the economic reform programme is now cruising on auto pilot and will be difficult to reverse. Furthermore, by resigning in the face of the cavalier treatment meted by the President, she has shown that being in government is not the be all and end all of life. It should serve as an example to sit tight government appointees who wait until they are unceremoniously booted out from office. As for Nenadi Usman, the shoes left by her predecessor will certainly be difficult to fill. If she makes the mistake of stumbling in them, there will be no one to break her fall, not even Mr. President.  


 

 

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