Soludo Replies Okonjo-Iweala, Alleges Over N30 Trillion Has Been Stolen Under Her Watch

Former governor of Central Bank of Nigeria (CBN),
Charles Soludo is back again with another
controversial article.
And this time, he is responding to the article
written by Coordinating Minister for the Economy
and Minister of Finance, Ngozi Okonjo-Iweala, in
which she called him an “embittered loser.”
In his response titled Ngozi Okonjo-Iweala and the
Missing Trillions (1) Chukwuma Charles Soludo, he
alleges that more than N30 trillion has either
been stolen or unaccounted for under Okonjo-
Iweala’s watch in the last four years. He also says
she is the cause of nation’s collapsed economy.
Read the full article, as reported by Premium
Times:
1. I read some of the responses to my article,
“Buhari vs Jonathan: Beyond the Election”, and I
want to thank everyone who has contributed to
the debate. I am glad that the debate has finally
taken off. I have decided, for the record, to re-
enter the debate if only to set some records
straight and hopefully elevate the debate further.
Whom do I respond to? First, let me thank Gov
Kayode Fayemi for his very mature and
professional response on behalf of the APC. It
forms a great basis for deepening the
conversation. Pat Utomi, Oby Ezekwesili, Iyabo
Obasanjo, and thousands of other patriotic
Nigerians have raised the content of the debate.
Femi Fani-Kayode made me laugh, as usual. The
Gov. Jang faction of the Governors’ Forum played
the usual politics, although I know what most of
them think privately. Who else? Oh, Peter Obi.
Well, since he can’t write and designated
Valentine as usual to write for him (who never
disputed the NBS statistics that Obi broke world
record in the pauperization of Anambra people
but instead focused on lies and abuses) I won’t
dignify him with a response here. His third class
performance in Anambra will be the subject of a
comprehensive article later.
2. Here, I will focus on Dr. Ngozi Okonjo-Iweala’s
response (as Minister of Finance and Coordinating
Minister of the Economy—CME and hence on
behalf of the Federal Government). Since I have
known her, out of deep respect, I have never
called her by her name: I call her Madam. I must
state that I have great pains seeing myself on the
opposite side of the table with Madam, in this
way. I respect you, Madam, and will always do. If
you read my article of September 2010 (before
you became Minister), the tone and elucidation
were as strong as the current one. It is my honest
effort to ensure that our choice of leaders is based
on rigorous scrutiny of what is on offer. Part of
my frustration is that five years after, everything I
warned about has come to happen and we are
conducting our campaigns as if we are not in
crisis. As a concerned Nigerian, I have a duty to
speak out again. Regrettably, you have taken it
very personal.
3. I am not bothered about the personal abuses: I
actually expected worse. What name has the
government not called President Obasanjo or any
person who has dared to disagree with it of late?
Anyone who disagrees with the government must
either be ‘insane’ or have a ‘character’ deficiency
or must be ‘looking for a job’ or ‘without honour’,
or a ‘charlatan’. Yesterday, Sanusi alleged that
$20 billion was missing and he was accused of
gross financial mismanagement, recklessness and
poor governance to the point of being the first
governor of central bank to be suspended from
office. Today, he is the good one; and for daring
to award an “F” grade for our economic
performance, Soludo has become the ‘worst’ and
‘without character’ or perhaps ‘looking for
position’ (Lol!). Some days ago, a former
president was called ‘a motor park tout’ and ‘un-
statesmanly’ just for disagreeing. This “how dare
you criticise us” mind-set of the government is
dangerous for our democracy.
4. In this Part One of my planned three part
series, I will restrict it to the main issues you
raised. I will not bother about the malicious
attacks on my person. For me, it is nothing
personal. In early 2011, I had a similar heated
exchange with then Finance Minister Segun
Aganga. But when the Nigerian economy was at
stake and he invited me to a stakeholders
meeting in his office (as Minister of Trade and
Investment) to discuss Nigeria’s response to the
ruinous EU- Economic Partnership for Africa
(EPA), I flew into Nigeria for that (at my expense)
— the first and only time I have been to any
government office to discuss policy since I left
office. It is about Nigeria. I will, as expected,
remind people like you of the salient aspects of
my record of public service in response to your
charge; challenge your claim to debt relief, and
your reason for not saving; highlight your forgery
of economic statistics and the lies in your
response; but most importantly re-focus our
attention to the historic mismanagement of our
economy which you carefully avoided.
5. I will show that while you are introducing
austerity measures and soon to immiserate the
citizens, our public finance is haemorrhaging to
the point that estimated over N30 trillion is
missing or stolen or unaccounted for, or simply
mismanaged— under your watch! We can’t go on
like this, and I am convinced that an alternative
future is possible. Can we have a public debate on
this alternative future? The issues at stake are too
grave to be trivialized through name calling. As I
write, the naira exchange rate to the dollar is at
N215 (from N158 a few months ago) and unless
oil price recovers, this is just the beginning. For
the sake of Nigeria, I won’t keep quiet anymore!
6. Let me start with Madam’s rather comical, wild
judgment on my tenure of office which I believe
to be totally false and baseless. I apologise
upfront that in the process of making a ‘personal
defence’, it is difficult to avoid a rather
uncomfortable emphasis on “I”. I did not want
that but since Madam has dragged us this low, I
have little choice but to do so in the next few
paragraphs—just to keep the record straight!
7. In my view, there are three criteria for
evaluating a public officer’s stewardship: the
evaluation by his employer; the satisfaction of the
public he served; and the hard facts of
performance. As I will show on these three
counts, I am convinced that I left a world record
of public service, and a thousand Okonjo-Iwealas
cannot re-write that history. I served Nigeria
under two presidents (Obasanjo and Yar’Adua)
and as my immediate bosses, below are their
written testimonials of my record.
8. Said President Obasanjo (December 2004):
“Charles Soludo is a true Nigerian. He is the sort
of Nigerian that we all know we can rely on.
Among his numerous virtues is COURAGE. I have
found in him a man who can take tough and
realistic decisions, stand his ground, educate
others on the salience of his decision, and work
very hard to ensure that the decision is efficiently
and effectively implemented. His dedication to
duty is first rate. His leadership qualities are
admirable and his willingness to listen and learn is
simply infectious. Professor Soludo has within a
short time emerged as one of the leading lights of
our nation. Not because he has a godfather but
by sheer hard work, loyalty, dedication to duty,
commitment to the nation, creativity, and
undiluted association with the reform agenda….”
9. President Yar’Adua (May 2009) had the
following to say about the Central Bank of Nigeria
under my leadership:
“… the CBN has performed creditably well in
delivering on its core mandates. This is especially
even more so in the last five years. Most people
would agree that without the successful banking
consolidation and effective management of our
foreign reserves, the current global crisis would
have shaken the financial system and our national
economy to their foundations with calamitous
consequences”.
In the President’s special letter of commendation
after the completion of my tenure of office,
President Yar’Adua (June 2009) had the following
to say to me:
“As your tenure as Governor of the Central Bank
of Nigeria comes to a glorious end, I write on
behalf of the Government and people of Nigeria to
place on record our debt of gratitude to you for
your dedicated service and uncommon sense of
duty over the past five years. I am confident that
your worthy antecedents in the CBN and in prior
appointments in the service of our nation remain
sources of inspiration to an entire generation. As I
wish you even more astounding successes in the
years ahead, it is my fervent hope that you will
readily avail us of your distinguished service when
the need arises in the future”.
11. To the best of my knowledge, President
Obasanjo has not changed those views even after
ten years. The views of my two bosses, not the
emotional outburst of an angry person desperate
to get even, are what count.
12. How did Nigerians evaluate my public service?
Unfortunately, we do not have scientific opinion
polls on job approval ratings for individual public
officers. But if the public opinions of individuals
and organized groups (labour, employers,
depositors, borrowers, stakeholders of the
financial institutions, newspaper editorials,
investors, etc) as expressed in thousands of
newspaper/magazine clips during and after my
tenure are anything to go by, then 82% of the
public largely agree with the sentiments
expressed by my two bosses. Your views belong
to the other 18% which is okay, after all, no one is
perfect.
13. Five Nigerian newspapers and magazines
simultaneously named us “man of the year” in
one year— unprecedented in Nigeria’s history. I
do not talk about hundreds of awards and
recognitions by various segments of our society
(during and even after service) for “excellent
public service”. I was particularly touched by the
historic award by the staff union of the Central
Bank and the tears in the eyes of many as
thousands of the staff gave me a standing ovation
as I walked the aisle after my brief farewell
speech.
14. Certainly, the international community
(investors, bankers, scholars, donors, media, etc)
took serious notice of the revolution in Nigeria’s
monetary and financial system. I am recipient of
five international awards as global and African
central bank governor of the year, not to mention
dozens of other recognitions (even after leaving
office). The London Financial Times described us
as “a great reformer”. Even as the global
economic and financial crisis raged in 2008, the
United Nations General Assembly appointed me to
serve on the Commission of Experts to reform the
international monetary and financial system. You
don’t appoint someone who has ‘mismanaged’
his national financial system to reform the global
system.
15. For 8 years until 2012, I served on the chief
economist advisory council (CEAC) of the World
Bank, and together with two Nobel Prize winners
in economics and other experts we met
periodically and advised two presidents and two
chief economists of the World Bank, and in 2011,
I served on the External Advisory Group of the
IMF. Again, these are not positions for ‘mis-
managers’. Since I left office, I have been
advising countries and central banks; and there is
hardly any two months I don’t consult/advise on
banking/financial and monetary policy. I have
given these illustrations to make the point that for
every one Okonjo-Iweala’s attempt to rewrite
history, there are thousands who disagree.
16. Now, to some skeletal facts of our
stewardship! I will be brief as I have a whole book
to tell my story. As chief economic adviser, I had
advised that our banking system could not
support the private sector-led economy
envisioned under NEEDS. When I assumed office
at CBN, I inherited 89 rickety, mostly family banks
(all of which put together were not up to the size
of number four bank in South Africa). Many were
insolvent, with depositors’ money trapped, and
20 more about to collapse. To get a credit of
$300 million probably required all the banks to
syndicate it. For me, there was a national
emergency. I drafted a 13-point reform agenda,
discussed and agreed all the specifics with the
President, and his VP; as well as my management
team at the CBN, and we swung into action.
President Obasanjo promised 100% support and
actually delivered 1000%— which was decisive. I
apologize to you Madam because I did not brief or
inform you about it. We just wanted to keep it
confidential given the sensitivity of the
announcement. It is on record that you never
supported it.
17. It was both a revolution and a war and most
people thought it was “impossible”, but thank
God we succeeded. For the first time in Nigeria’s
history a policy of that magnitude was announced
and deadline kept with precision. We were
courageous to revoke the licenses of 14 banks,
including those of my friends, in one day. The FT-
Banker concluded that the scale, precision, and
cost of the transformation were unprecedented in
the world. Before then, Malaysia had the least
cost of banking consolidation at 5% of Malaysian
GDP. It did not cost Nigerian taxpayers one
penny.
18. Twenty-five new, stronger banks emerged but
the powerful idea behind consolidation ignited
something even more powerful—‘the race to the
top’. Banks raised more capital, and even banks
like First Bank, Zenith, GTB, etc that did not
merge with others went on capital raising several
times. The consequence was higher levels of
capitalization and within two years, 14 Nigerian
banks were in the top 1000 banks in the world
and two in the top 300 (no Nigerian bank was in
the top 1000 before I came). Even after I left
office, still 9 banks were in the top 1000. Our
vision was to have a Nigerian bank in the top 100
banks within 10 years. As I see the new Access
bank; Zenith, GTB, Fidelity, Diamond, UBA, FBN,
FCMB, Skye, Stanbic IBTC, Union, Ecobank, etc, I
cannot but feel that we have taken giant steps
forward.
19. Deposits and credit soared (from barely N1.2
trillion to over N7 trillion); new technologies (ATM
and e-banking) boomed, and banks had 57,000
new jobs; mega businesses emerged (ask any
major operator in the Nigerian economy their
experience with banking and credit before and
after Soludo —the Dangotes, Arik, MM2, oil and
gas operators; etc); capital market boomed and
dominated by the banking sector. It was a new
dawn for Nigerian private sector. I have heard
Dangote twice say that he would not be near as
big as he is today without the banking
consolidation. Many other stakeholders still say it
today. FDI and portfolio inflows flooded into
Nigeria. The world celebrated, and one single
transformative idea has changed the face of the
private sector and economy forever. Banks
became Nigeria’s first transnational corporations
with about 37 branches outside of Nigeria.
20. Nigeria survived the global crisis because of
this, and it is the banking sector that has largely
been powering the economic growth you claim
(compare banks trillions of naira credit for
investments in the productive sector with your
government’s miserable expenditure on critical
infrastructure and investment; much of your
borrowing – bonds – is from the banks). Your
privatization of power sector, several PPP projects
on infrastructure, etc, are now possible because
of the mega banks.
21. Today, Nigerian banks syndicate multi-billion
dollar loans— unthinkable before. Madam, if the
consolidation was ‘mismanaged’, there would not
have been any bank to start with in the aftermath
of the global crisis— as President Yar’adua
correctly pointed out. Even you, during a recent
presentation at the Banquet Hall in Abuja
advertised consolidation as a historic
achievement. How can you recognize a ‘mis-
managed’ project as an outstanding
achievement? As we say in Igbo, you can’t cover
the moon with your palms.
22. Let me be clear: the quantum size of the new
banks following consolidation presented
challenges of risk management and supervision.
We deployed all we had and overworked the CBN
staff. The carry-over of bad loans from the
consolidated banks was quickly cleaned up. To
the best of my knowledge, we instituted stringent
regulatory and supervisory regime (consistent
with best practices at the time). We even had
resident examiners in the banks and required
bank MDs to personally sign their reports to CBN.
I recall that the former MD of GTB complained of
“regulatory intrusiveness”.
23. To our credit, non-performing loans (NPL)
came down from 22% in 2003 and 2004 to 6% as
at 2008. Anywhere in the world, a central bank
that brought NPL from 22% to 6% over a four
year period does not look like one with a loose
supervisory regime. Name other developing
countries that performed better, Madam. So, on
point of fact, Madam lied. Yours was a reckless
assertion without basis by a Finance Minister.
24. The banks in Nigeria were supervised by the
CBN and NDIC, but other institutions—
international firms which audited them,
international rating agencies which also examined
their books, capital market operators since most
were listed companies — all had oversight. I put
on record that there was never any information/
report of infractions by any bank which was
brought to my attention and which we did not
act upon decisively during my tenure. I heard the
comment that some of the bank MDs were my
friends.
25. Well, my response is that perhaps as CME you
should kill all your friends operating in the
economy or become their enemies. For the
record, my successor audited all the banks and
none of my so-called friends was indicted. It
speaks volumes. Indeed, it is also a fact that the
alleged personal criminal infractions (including
lapses in corporate governance Madam alluded
to) by some bank CEOs were found out, only
AFTER they had been removed from office.
26. My successor told me that the comprehensive
audit of the banks did not reveal such infractions.
Of course, you must be God or have a special tip-
off from inside to get to such information while
the MDs are in office. Unfortunately, all over the
world, no financial system has succeeded in
routing out all criminal behaviours by the
operators. So, Madam, I challenge you to provide
one shred of evidence that ‘there was no
separation between regulators and regulated’ or
be honourable enough to retract your reckless
statement.
27. What happened? The unanticipated and
unprecedented crisis of 2008/09 hit the world.
More than 40 US and European banks either
collapsed or were shaken badly (remember the
Lehman Brothers, Fannie Mae and Freddie Mac,
Wachovia, HSBC, Lloyds TSB, Citibank, Goldman
Sachs, even UBS, etc) and hundreds of billions of
dollars were spent to bail them out. The
contagion effects spread like a wild fire,
destroying national stock markets and banks. The
nascent (big) banks in Nigeria faced sudden
multiple shocks— liquidity, exchange rate, oil
price, capital market, etc.
28. As oil prices collapsed, loans to oil and gas
became non-performing overnight; loans to the
capital market became non-performing overnight;
etc. Our first priority was to save the entire
banking system and the economy from systemic
collapse. I assured Nigerians that no bank would
be allowed to fail, and not many people know
what it took to achieve it. Once we had navigated
through the unexpected /unprecedented
turbulence, we laid out a comprehensive plan to
clean up the debris which we presented to
stakeholders in Lagos (March 2009). I had
pleaded with the Senate to pass the AMCON bill
which we sent to them in 2004. But I had a
comprehensive plan to finish the clean-up with or
without AMCON by the end of 2009, including
second round consolidation and a N500 billion
fund (my book will detail all these). I left behind
an 11-volume document of the Financial System
Strategy 2020 (FSS2020) which has remained
the policy roadmap for the CBN/financial sector
since I left office.
29. I have two analogies for our experience. Ours
was really like an airplane that was cruising and
suddenly meets an unexpected and
unprecedented turbulence. After the pilots and
the crew succeed in navigating through the
potential crash and probably land the airplane,
people look in and start blaming the crew for the
broken tea cups, chairs, and drinks that fell
during the turbulence as evidence that the crew
never kept the airplane clean or serviced it. My
second analogy is that of a sudden earthquake in
a region it was never expected and some houses
collapsed. All of a sudden, the housing authority
is to blame for not requiring earthquake-proof
foundations for the houses. Well, my legal experts
call it force majeure, an act of nature!
30. To be fair, after every crisis, there are lessons
(and my book will detail what, with benefit of that
experience, we should have done differently). Risk
management— which has always been there—
now took a new centre stage all over the world
following the crisis. But for anyone to suggest
that CBN under me, for one minute, took its eyes
off the ball is, to say the least, ludicrous. The US
financial system literally crippled the world
costing America hundreds of billions of dollars but
no one has suggested that Alan Greenspan is no
longer the great maestro!
31. AMCON is a big topic (which I will address at a
later date) but her claims show either ignorance
or mischief. She claims that N5.7 trillion of
AMCON funds was used to rescue banks and the
‘bond issued’ as ‘cost to taxpayers’. Really? I will
deal with the AMCON I envisaged and the AMCON
under you later but let me state that even if
100% of the banks’ NPL was offloaded on AMCON,
it would not be up to N5.7 trillion. Enough said for
now. The fact is that the Federal Government has
not put a penny in the AMCON fund: the banking
system is financing itself, and together with the
sinking fund by banks, AMCON surely can’t
default (thanks to consolidation that the banks
are now big enough to cough out such funds to
solve the system’s problem). Did you intend to
deceive the readers by refusing to tell them that
much of the AMCON fund is ‘investment’ and not
‘expense’. Am sure you heard the IMF’s alarm
about moral hazard? If you want, we can have a
focused debate on AMCON.
32. Next, let me briefly respond to a few
outlandish claims. She brags about ‘single-digit’
inflation rate ‘now’ and alleges that when I left
office, inflation was above 13%. I just laughed at
this one. In Nigeria’s history, no governor of the
Central Bank has delivered 24 consecutive
months of single digit inflation as I did until the
advent of the unprecedented global crisis in
2008. It was not for nothing that the world
cheered us as monetary policy czar, Madam!
Perhaps you are also not aware that we broke a
world record by having a depreciated real
effective exchange rate during a time of export
boom and this was at the heart of our reserve
accumulation and the portfolio/FDI inflows.
33. I resisted the IMF advice to deplete reserves
for liquidity management, and Nigeria had
enough self-insurance to survive the global crisis.
The opposite has happened under you Madam,
and the Nigerian economy is in trouble. Naira
exchange rate appreciated under me from N133
to N117 before the global crisis; and reserves
grew to all time high of $62 billion. For the first
time since 1986, the official, interbank and
parallel market exchange rates converged under
me. You can’t match these records!
34. I hereby challenge your attempt to blame
others for not saving for the rainy day. It is not a
virtue when you are quick to appropriate all the
credit when things are going well, but shift the
blame when they go wrong. You blame the state
governors— who, according to you, have taken
the Federal Government to the Supreme Court—
not that a Supreme Court judgment forced your
hands.
35. For your information, the governors have
never agreed to savings and always threatened
court action even under Obasanjo. Why did we
save under Obasanjo but not under Jonathan?
Two keywords explain it: leadership and integrity.
Governor Amaechi said the governors insisted on
sharing the funds because they found out that
you were illegally fiddling with the savings. So, as
Nigerians still wonder, if billions of dollars are now
‘missing’ under your nose, why should governors
trust you to keep their money?
36. Do the states that have taken the federal
government to the Supreme Court and refused to
save also include the PDP governors—who are in
the majority? If so, then it is fatal: even governors
of your own party, PDP, do not trust you to keep
their money! Furthermore, did the governors also
stop the Federal Government from saving part of
its share? If you ran a surplus budget at the
Federal level, you would have had credibility to
blame others or to say they did not listen to your
advice. The key point is that since you were
running huge deficits yourself, it was also in your
own interest to share the ECA. You did not show
leadership or credibility, full stop!
37. Next, Madam, I was really embarrassed for
you to read that one of the reasons for declining
forex reserves is ‘oil theft’. Under you as Minister
of Finance and coordinator of the economy, the
basket of our national treasury is leaking profusely
from all sides. Just a few illustrations! First, you
admit that ‘oil theft’ has reduced oil output from
the average 2.3 – 2.4 million barrels per day
(mpd) to 1.95mpd (meaning that at least
350,000 to 450,000 barrels per day are being
‘stolen’. On the average of 400,000 per day and
the oil prices over the past four years, it comes to
about $60 billion ‘stolen’ in just four years.
38. In today’s exchange rate, that is about N12.6
trillion. This is at a time of cessation of crisis in the
Niger Delta and amnesty programme. Can you tell
Nigerians how much the amnesty programme
costs, and also the annual cost for ‘protecting’
the pipelines and security of oil wells? And the
‘thieves’ are spirits? Come on, Madam!
39. Second, my earlier article stated that the
minimum forex reserves should have been at
least $90 billion by now and you did not
challenge it. Rather it is about $30 billion,
meaning that gross mismanagement has denied
the country some $60 billion or another N12.6
trillion.
40. Now add the ‘missing’ $20 billion from the
NNPC. You promised a forensic audit report
‘soon’, and more than a year later the Report
itself is still ‘missing’. This is over N4 trillion, and
we don’t know how much more has ‘missed’
since Sanusi cried out. How many trillions of naira
were paid for oil subsidy (unappropriated?). How
many trillions (in actual fact) have been ‘lost’
through customs duty waivers over the last four
years? As coordinator of the economy, can you
tell Nigerians why the price of automotive gas oil
(AGO), popularly called diesel, has still not come
down despite the crash in global crude oil prices,
and how much is being appropriated by friends in
the process? Be honest: do you really know (as
coordinator and minister of finance) how many
trillions of Naira, self- financing government
agencies earn and spend? I have a long list but
let me wait for now. I do not want to talk about
other ‘black pots’ that impinge on national
security.
41. My estimate, Madam, is that probably more
than N30 trillion has either been stolen or lost or
unaccounted for or simply mismanaged under
your watchful eyes in the past four years. Since
you claim to be in charge, Nigerians are right to
ask you to account. Think about what this
amount could mean for the 112 million poor
Nigerians or for our schools, hospitals, roads, etc.
Soon, you will start asking the citizens to pay this
or that tax, while some faceless “thieves” were
pocketing over $40 million per day from oil alone.
42. You alluded to debt relief in your response
and tried to take credit. Well, your CV is honest
enough to admit that your two achievements in
office as Finance minister under Obasanjo were
that “you led the Nigerian team that struck a deal
with the Paris Club” and that you “introduced the
practice of publishing each state’s monthly
financial allocation in the newspapers”. You are
right about the two achievements. Let me put on
record that Nigeria would have secured debt relief
under anyone as Minister of Finance. President
Obasanjo secured debt relief for Nigeria. Much of
his first term was used to get Nigeria back into
the international community and to campaign for
debt relief. Before you were sworn in as Minister of
Finance, President Bush visited Nigeria and both
of us accompanied President Obasanjo during the
meeting. There, Mr. Bush promised to support
Nigeria with debt relief and asked our president to
ensure that he met the conditions of the Paris
Club. Obasanjo mobilized the global political
support and coordinated all of us to ensure that
the government met the check-list of
‘conditionalities’ as required. I spent five weeks
in the hotel with my team (as coordinator/
chairman for drafting the National Economic
Empowerment and Development Strategy,
NEEDS).
43. Some of the reform targets in NEEDS became
the ‘conditionalities’ Nigeria was required to fulfil
to merit debt relief. You and I signed the various
MoU with the IMF on behalf of Nigeria (the policy
support instrument). We had a great team at
work and each member of the economic team
had specific aspects of the conditionalities to
deliver: Bode Agusto was in-charge of the budget;
Oby Ezekwesili held sway at Bureau of Public
Procurement and later Minister of Solid Mineral,
and Education (but specifically tasked with
delivering on EITI and procurement reforms);
Nuhu Ribadu was at the EFCC fighting corruption;
I was at the Central Bank delivering on monetary
policy and banking reforms; Steve Oronsaye
worked hard to delist Nigeria from the FATF;
Nenadi Usman was in-charge of the parastatals;
El-Rufai held forth at FCT and in charge of public
sector reforms; privatization programme went on,
etc. Did you know that the IMF wrote President
Obasanjo threatening that there would be no
debt relief if the CBN did not meet some
monetary targets, and do you know the magic we
performed to meet them? Can you tell Nigerians
which of the ‘conditionalities’ that you personally
implemented? With the groundswell of political
support and Nigeria meeting all the
‘conditionalities’, debt relief was assured.
44. Your major role as stated in your CV was to
lead the team to negotiate the specific terms of
the relief, having fulfilled the conditions. I still
believe that Nigeria should have gotten far better
terms than you negotiated. Of course, with your
eyes on returning to the World Bank after office, I
did not expect you to boldly stand up to the
donor community in defence of Nigeria. Was
there a conflict of interest on your part?
45. By the way, can you tell Nigerians why you
were eased out as Finance Minister and you cried
like a baby begging OBJ to still allow you remain
in the Economic Management team—- barely few
weeks after the debt relief? Why were you
eventually also removed from the economic
management team if you were so important?
Ironically, President Jonathan has recycled you,
with a bigger title and greater responsibilities. But
the difference is that the team that did the actual
work is no longer there, and the world has seen
that the king is naked.
46. You are brilliant Madam, but you need serious
help. Having spent all your life in the World Bank
bureaucracy largely in administration/operations,
no one will blame you if your economics has
become a bit rusty. There are firebrand Nigerians
all over the world to draft to service. It is certainly
embarrassing to Nigeria for you to be bothering
World Bank economists to help you with most
basic economic analysis.
47. Your response on the poverty issue is deeply
troubling. You accuse me of using “2011
statistics on poverty by the NBS to support his
argument, while ignoring more recent figures”. At
least you did not refute the NBS figure as valid. In
the next sentence, Madam went ahead to note
that “as stated in the Nigeria Economic Report
2014 by the World Bank, poverty in Nigeria has
dropped from 35.2 percent of population in
2010/2011 to 33.1 percent in 2012/2013”. Did
you notice that you have quoted two figures for
poverty for the same year as being equally
correct? So, for 2011, was poverty 71%
(according to NBS) or 35% according to the
World Bank? To the best of my knowledge, the
last published household survey by NBS was in
2011. The World Bank does not conduct
household surveys in member states to determine
poverty incidence. So, when and by whom was
the survey that gave the World Bank figures?
48. What worries me is that this government is
the first in our history to attempt to manipulate
our national statistics under Okonjo-Iweala. When
NBS published the poverty figures in 2011, she
felt indicted and incensed. She called upon the
World Bank to come and examine the
‘methodology’ and get NBS to ‘review’ its
numbers. Oby Ezekwesili (as VP Africa Region
rejected the call to try to tamper with a country’s
statistics). Once Oby left, the ‘World Bank’ started
talking about ‘new figures’, without conducting
any new surveys. I was told about it by a World
Bank economist, and I cautioned that it was a
dangerous gamble that would damage the
credibility of the NBS. If you want to ‘review
methodology’, you conduct another survey but
you can’t change ‘methodology’ because you
don’t like the published figures. No government
in our history has tried it: even Sani Abacha
allowed a poverty survey that put poverty at 67%
under his regime. At this rate, who will believe
statistics coming from the Nigerian government
again? Is it now the World Bank that sits in
Washington and allocates poverty numbers to
Nigeria? Something smells here!
49. Madam alleges that the NBS—as a parastatal
under the National Planning Commission (under
me) departed from the ‘international standard
method of poverty measurement’. How and
when, Madam? I was in office at National Planning
for 11 months from July 2003 to May 2004. A
poverty survey was conducted in 2004 and the
results computed and published in 2005/2006—
more than a year after I had gone to the Central
Bank. Or perhaps, it was a clever way to divert
attention from your manipulation of published
economic statistics. The NBS published its
poverty data in 2006 when you were Minister of
Finance, and you did not question the
‘methodology’ because the figures looked good.
In 2011, the poverty numbers (using the same
methodology as in 2005/2006) indicted the
government and suddenly, the ‘methodology’ is
wrong. Interesting times!
50. Now that you decide which economic
statistics published by NBS to accept and which
ones to ‘change the methodology’ to give
favourable figures, you can keep feeding your
manipulated figures to your international media
circus for the vain glorious awards to sustain an
empty hype, while Nigerians groan under
hardship. We can actually ask Nigerians whether
they are getting better off now contrary to your
bogus figures.
51. Many of Madam’s responses were comical,
but this one is classic. According to her, the chief
economic adviser and NBS “worked hard to
determine how many jobs we need to create in a
year”, and went on to ask, “why didn’t Soludo do
this when he was CEA?” (Lol!). Madam, any good
economist needs less than 10 minutes to
compute this figure, not the (months? of) ‘hard
work’ by your team. My calculation is that the
number of jobs Nigeria needs to create each year
to significantly reduce unemployment rate to
sustainable levels in the next few years is at least
3 million, and not the 1.8 million by your team.
We are talking about the Nigerian economy,
please.
52. Your magic wand for mass housing is the
Mortgage Refinance Corporation with 23,000
mortgage offers—for a country with 17 million
housing deficit! Then, there is the pedestrian
proposal of a new development bank— financed
with loans from the World Bank, etc? A World
Bank loan to set up another ‘development bank’
where we already have Bank of Industry, Bank of
Agriculture, NEXIM, Federal Mortgage Bank, etc?
People have totally run out of ideas and can’t see
anything for Nigeria without through the prism of
the World Bank. I will offer you free consultancy
on how to set up a development bank without a
World Bank loan but we don’t need another one
now. I actually gave President Yar’adua a two
page note for a N3 trillion development fund
then, and if we plug your leaking pipes, it could
actually be a N10 trillion Fund. I envisioned and
set up the Africa Finance Corporation (AFC)—
Africa’s premier infrastructure bank!
53. Frankly, I don’t understand why you seem
highly troubled that the Soludo you thought had
“disappeared from the political space” seems to
be still around. Well, let me assure you that I will
only ‘disappear’ in God’s own time. I gave credit
to two past presidents who laid the foundation of
the market economy we operate today. You did
not contest or contradict any of my points.
Rather, what you see is that Soludo must be
‘looking for a position’. Pity! If I am looking for a
position, I would be running around one of the
candidates now just as you are busy dancing
Atilogwu dance at TAN and PDP rallies, struggling
to keep your job. How Yar’adua drafted me to
contest for governor in Anambra and APGA
leadership as well and how I was “stopped” on
both occasions are in the public domain. But I am
not deterred for one minute. Chinua Achebe said
that on leadership, Nigeria is a country that goes
for a football match with its 10th Eleven.
54. I am proud and happy to have offered to
serve my people, and for the service of Nigeria, I
will do it again and again. How many times did
Abraham Lincoln, Obama, Reagan, etc contest
before they got there? I actually encourage
everyone who believes he/she has something to
offer to get involved or stop complaining. I am
happy seeing the increasing critical mass of
professionals (like you) now getting involved. It is
good for Nigeria!
55. What is at stake is the survival and prosperity
of Nigeria. Next elections are critical, and for me
the key is the ECONOMY. We must offer Nigerians
clarity on the choices before them. Can I propose
a three-way debate with you (representing PDP/
Federal Government), nominee of APC (Utomi or
Fayemi? or any other), and myself (as
independent citizen— I don’t belong to any of the
two). Let us have two bouts of debate between
now and 12th February, 2015 focusing on: CBN/
AMCON and the financial system (if you want);
our economy and its outlook, and agenda/
alternative paths to sustainable prosperity post
elections. Choose the dates and times, and for the
sake of Nigeria, I will fly in. You can invite any of
your international media friends as moderators. I
feel the pain of the 180 million Nigerians whose
tomorrow you have carelessly rendered bleak,
and when I think of what the missing trillions
could do for them, it becomes extremely urgent
that we all must deepen the debate. Eagerly
waiting for your response, please.
Soludo Replies Okonjo-Iweala,
Alleges Over N30 Trillion Has Been
Stolen Under Her Watch
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Software
Former governor of Central Bank of Nigeria (CBN),
Charles Soludo is back again with another
controversial article.
And this time, he is responding to the article
written by Coordinating Minister for the Economy
and Minister of Finance, Ngozi Okonjo-Iweala, in
which she called him an “embittered loser.”
In his response titled Ngozi Okonjo-Iweala and the
Missing Trillions (1) Chukwuma Charles Soludo, he
alleges that more than N30 trillion has either
been stolen or unaccounted for under Okonjo-
Iweala’s watch in the last four years. He also says
she is the cause of nation’s collapsed economy.
Read the full article, as reported by Premium
Times:
1. I read some of the responses to my article,
“Buhari vs Jonathan: Beyond the Election”, and I
want to thank everyone who has contributed to
the debate. I am glad that the debate has finally
taken off. I have decided, for the record, to re-
enter the debate if only to set some records
straight and hopefully elevate the debate further.
Whom do I respond to? First, let me thank Gov
Kayode Fayemi for his very mature and
professional response on behalf of the APC. It
forms a great basis for deepening the
conversation. Pat Utomi, Oby Ezekwesili, Iyabo
Obasanjo, and thousands of other patriotic
Nigerians have raised the content of the debate.
Femi Fani-Kayode made me laugh, as usual. The
Gov. Jang faction of the Governors’ Forum played
the usual politics, although I know what most of
them think privately. Who else? Oh, Peter Obi.
Well, since he can’t write and designated
Valentine as usual to write for him (who never
disputed the NBS statistics that Obi broke world
record in the pauperization of Anambra people
but instead focused on lies and abuses) I won’t
dignify him with a response here. His third class
performance in Anambra will be the subject of a
comprehensive article later.
2. Here, I will focus on Dr. Ngozi Okonjo-Iweala’s
response (as Minister of Finance and Coordinating
Minister of the Economy—CME and hence on
behalf of the Federal Government). Since I have
known her, out of deep respect, I have never
called her by her name: I call her Madam. I must
state that I have great pains seeing myself on the
opposite side of the table with Madam, in this
way. I respect you, Madam, and will always do. If
you read my article of September 2010 (before
you became Minister), the tone and elucidation
were as strong as the current one. It is my honest
effort to ensure that our choice of leaders is based
on rigorous scrutiny of what is on offer. Part of
my frustration is that five years after, everything I
warned about has come to happen and we are
conducting our campaigns as if we are not in
crisis. As a concerned Nigerian, I have a duty to
speak out again. Regrettably, you have taken it
very personal.
3. I am not bothered about the personal abuses: I
actually expected worse. What name has the
government not called President Obasanjo or any
person who has dared to disagree with it of late?
Anyone who disagrees with the government must
either be ‘insane’ or have a ‘character’ deficiency
or must be ‘looking for a job’ or ‘without honour’,
or a ‘charlatan’. Yesterday, Sanusi alleged that
$20 billion was missing and he was accused of
gross financial mismanagement, recklessness and
poor governance to the point of being the first
governor of central bank to be suspended from
office. Today, he is the good one; and for daring
to award an “F” grade for our economic
performance, Soludo has become the ‘worst’ and
‘without character’ or perhaps ‘looking for
position’ (Lol!). Some days ago, a former
president was called ‘a motor park tout’ and ‘un-
statesmanly’ just for disagreeing. This “how dare
you criticise us” mind-set of the government is
dangerous for our democracy.
4. In this Part One of my planned three part
series, I will restrict it to the main issues you
raised. I will not bother about the malicious
attacks on my person. For me, it is nothing
personal. In early 2011, I had a similar heated
exchange with then Finance Minister Segun
Aganga. But when the Nigerian economy was at
stake and he invited me to a stakeholders
meeting in his office (as Minister of Trade and
Investment) to discuss Nigeria’s response to the
ruinous EU- Economic Partnership for Africa
(EPA), I flew into Nigeria for that (at my expense)
— the first and only time I have been to any
government office to discuss policy since I left
office. It is about Nigeria. I will, as expected,
remind people like you of the salient aspects of
my record of public service in response to your
charge; challenge your claim to debt relief, and
your reason for not saving; highlight your forgery
of economic statistics and the lies in your
response; but most importantly re-focus our
attention to the historic mismanagement of our
economy which you carefully avoided.
5. I will show that while you are introducing
austerity measures and soon to immiserate the
citizens, our public finance is haemorrhaging to
the point that estimated over N30 trillion is
missing or stolen or unaccounted for, or simply
mismanaged— under your watch! We can’t go on
like this, and I am convinced that an alternative
future is possible. Can we have a public debate on
this alternative future? The issues at stake are too
grave to be trivialized through name calling. As I
write, the naira exchange rate to the dollar is at
N215 (from N158 a few months ago) and unless
oil price recovers, this is just the beginning. For
the sake of Nigeria, I won’t keep quiet anymore!
6. Let me start with Madam’s rather comical, wild
judgment on my tenure of office which I believe
to be totally false and baseless. I apologise
upfront that in the process of making a ‘personal
defence’, it is difficult to avoid a rather
uncomfortable emphasis on “I”. I did not want
that but since Madam has dragged us this low, I
have little choice but to do so in the next few
paragraphs—just to keep the record straight!
7. In my view, there are three criteria for
evaluating a public officer’s stewardship: the
evaluation by his employer; the satisfaction of the
public he served; and the hard facts of
performance. As I will show on these three
counts, I am convinced that I left a world record
of public service, and a thousand Okonjo-Iwealas
cannot re-write that history. I served Nigeria
under two presidents (Obasanjo and Yar’Adua)
and as my immediate bosses, below are their
written testimonials of my record.
8. Said President Obasanjo (December 2004):
“Charles Soludo is a true Nigerian. He is the sort
of Nigerian that we all know we can rely on.
Among his numerous virtues is COURAGE. I have
found in him a man who can take tough and
realistic decisions, stand his ground, educate
others on the salience of his decision, and work
very hard to ensure that the decision is efficiently
and effectively implemented. His dedication to
duty is first rate. His leadership qualities are
admirable and his willingness to listen and learn is
simply infectious. Professor Soludo has within a
short time emerged as one of the leading lights of
our nation. Not because he has a godfather but
by sheer hard work, loyalty, dedication to duty,
commitment to the nation, creativity, and
undiluted association with the reform agenda….”
9. President Yar’Adua (May 2009) had the
following to say about the Central Bank of Nigeria
under my leadership:
“… the CBN has performed creditably well in
delivering on its core mandates. This is especially
even more so in the last five years. Most people
would agree that without the successful banking
consolidation and effective management of our
foreign reserves, the current global crisis would
have shaken the financial system and our national
economy to their foundations with calamitous
consequences”.
In the President’s special letter of commendation
after the completion of my tenure of office,
President Yar’Adua (June 2009) had the following
to say to me:
“As your tenure as Governor of the Central Bank
of Nigeria comes to a glorious end, I write on
behalf of the Government and people of Nigeria to
place on record our debt of gratitude to you for
your dedicated service and uncommon sense of
duty over the past five years. I am confident that
your worthy antecedents in the CBN and in prior
appointments in the service of our nation remain
sources of inspiration to an entire generation. As I
wish you even more astounding successes in the
years ahead, it is my fervent hope that you will
readily avail us of your distinguished service when
the need arises in the future”.
11. To the best of my knowledge, President
Obasanjo has not changed those views even after
ten years. The views of my two bosses, not the
emotional outburst of an angry person desperate
to get even, are what count.
12. How did Nigerians evaluate my public service?
Unfortunately, we do not have scientific opinion
polls on job approval ratings for individual public
officers. But if the public opinions of individuals
and organized groups (labour, employers,
depositors, borrowers, stakeholders of the
financial institutions, newspaper editorials,
investors, etc) as expressed in thousands of
newspaper/magazine clips during and after my
tenure are anything to go by, then 82% of the
public largely agree with the sentiments
expressed by my two bosses. Your views belong
to the other 18% which is okay, after all, no one is
perfect.
13. Five Nigerian newspapers and magazines
simultaneously named us “man of the year” in
one year— unprecedented in Nigeria’s history. I
do not talk about hundreds of awards and
recognitions by various segments of our society
(during and even after service) for “excellent
public service”. I was particularly touched by the
historic award by the staff union of the Central
Bank and the tears in the eyes of many as
thousands of the staff gave me a standing ovation
as I walked the aisle after my brief farewell
speech.
14. Certainly, the international community
(investors, bankers, scholars, donors, media, etc)
took serious notice of the revolution in Nigeria’s
monetary and financial system. I am recipient of
five international awards as global and African
central bank governor of the year, not to mention
dozens of other recognitions (even after leaving
office). The London Financial Times described us
as “a great reformer”. Even as the global
economic and financial crisis raged in 2008, the
United Nations General Assembly appointed me to
serve on the Commission of Experts to reform the
international monetary and financial system. You
don’t appoint someone who has ‘mismanaged’
his national financial system to reform the global
system.
15. For 8 years until 2012, I served on the chief
economist advisory council (CEAC) of the World
Bank, and together with two Nobel Prize winners
in economics and other experts we met
periodically and advised two presidents and two
chief economists of the World Bank, and in 2011,
I served on the External Advisory Group of the
IMF. Again, these are not positions for ‘mis-
managers’. Since I left office, I have been
advising countries and central banks; and there is
hardly any two months I don’t consult/advise on
banking/financial and monetary policy. I have
given these illustrations to make the point that for
every one Okonjo-Iweala’s attempt to rewrite
history, there are thousands who disagree.
16. Now, to some skeletal facts of our
stewardship! I will be brief as I have a whole book
to tell my story. As chief economic adviser, I had
advised that our banking system could not
support the private sector-led economy
envisioned under NEEDS. When I assumed office
at CBN, I inherited 89 rickety, mostly family banks
(all of which put together were not up to the size
of number four bank in South Africa). Many were
insolvent, with depositors’ money trapped, and
20 more about to collapse. To get a credit of
$300 million probably required all the banks to
syndicate it. For me, there was a national
emergency. I drafted a 13-point reform agenda,
discussed and agreed all the specifics with the
President, and his VP; as well as my management
team at the CBN, and we swung into action.
President Obasanjo promised 100% support and
actually delivered 1000%— which was decisive. I
apologize to you Madam because I did not brief or
inform you about it. We just wanted to keep it
confidential given the sensitivity of the
announcement. It is on record that you never
supported it.
17. It was both a revolution and a war and most
people thought it was “impossible”, but thank
God we succeeded. For the first time in Nigeria’s
history a policy of that magnitude was announced
and deadline kept with precision. We were
courageous to revoke the licenses of 14 banks,
including those of my friends, in one day. The FT-
Banker concluded that the scale, precision, and
cost of the transformation were unprecedented in
the world. Before then, Malaysia had the least
cost of banking consolidation at 5% of Malaysian
GDP. It did not cost Nigerian taxpayers one
penny.
18. Twenty-five new, stronger banks emerged but
the powerful idea behind consolidation ignited
something even more powerful—‘the race to the
top’. Banks raised more capital, and even banks
like First Bank, Zenith, GTB, etc that did not
merge with others went on capital raising several
times. The consequence was higher levels of
capitalization and within two years, 14 Nigerian
banks were in the top 1000 banks in the world
and two in the top 300 (no Nigerian bank was in
the top 1000 before I came). Even after I left
office, still 9 banks were in the top 1000. Our
vision was to have a Nigerian bank in the top 100
banks within 10 years. As I see the new Access
bank; Zenith, GTB, Fidelity, Diamond, UBA, FBN,
FCMB, Skye, Stanbic IBTC, Union, Ecobank, etc, I
cannot but feel that we have taken giant steps
forward.
19. Deposits and credit soared (from barely N1.2
trillion to over N7 trillion); new technologies (ATM
and e-banking) boomed, and banks had 57,000
new jobs; mega businesses emerged (ask any
major operator in the Nigerian economy their
experience with banking and credit before and
after Soludo —the Dangotes, Arik, MM2, oil and
gas operators; etc); capital market boomed and
dominated by the banking sector. It was a new
dawn for Nigerian private sector. I have heard
Dangote twice say that he would not be near as
big as he is today without the banking
consolidation. Many other stakeholders still say it
today. FDI and portfolio inflows flooded into
Nigeria. The world celebrated, and one single
transformative idea has changed the face of the
private sector and economy forever. Banks
became Nigeria’s first transnational corporations
with about 37 branches outside of Nigeria.
20. Nigeria survived the global crisis because of
this, and it is the banking sector that has largely
been powering the economic growth you claim
(compare banks trillions of naira credit for
investments in the productive sector with your
government’s miserable expenditure on critical
infrastructure and investment; much of your
borrowing – bonds – is from the banks). Your
privatization of power sector, several PPP projects
on infrastructure, etc, are now possible because
of the mega banks.
21. Today, Nigerian banks syndicate multi-billion
dollar loans— unthinkable before. Madam, if the
consolidation was ‘mismanaged’, there would not
have been any bank to start with in the aftermath
of the global crisis— as President Yar’adua
correctly pointed out. Even you, during a recent
presentation at the Banquet Hall in Abuja
advertised consolidation as a historic
achievement. How can you recognize a ‘mis-
managed’ project as an outstanding
achievement? As we say in Igbo, you can’t cover
the moon with your palms.
22. Let me be clear: the quantum size of the new
banks following consolidation presented
challenges of risk management and supervision.
We deployed all we had and overworked the CBN
staff. The carry-over of bad loans from the
consolidated banks was quickly cleaned up. To
the best of my knowledge, we instituted stringent
regulatory and supervisory regime (consistent
with best practices at the time). We even had
resident examiners in the banks and required
bank MDs to personally sign their reports to CBN.
I recall that the former MD of GTB complained of
“regulatory intrusiveness”.
23. To our credit, non-performing loans (NPL)
came down from 22% in 2003 and 2004 to 6% as
at 2008. Anywhere in the world, a central bank
that brought NPL from 22% to 6% over a four
year period does not look like one with a loose
supervisory regime. Name other developing
countries that performed better, Madam. So, on
point of fact, Madam lied. Yours was a reckless
assertion without basis by a Finance Minister.
24. The banks in Nigeria were supervised by the
CBN and NDIC, but other institutions—
international firms which audited them,
international rating agencies which also examined
their books, capital market operators since most
were listed companies — all had oversight. I put
on record that there was never any information/
report of infractions by any bank which was
brought to my attention and which we did not
act upon decisively during my tenure. I heard the
comment that some of the bank MDs were my
friends.
25. Well, my response is that perhaps as CME you
should kill all your friends operating in the
economy or become their enemies. For the
record, my successor audited all the banks and
none of my so-called friends was indicted. It
speaks volumes. Indeed, it is also a fact that the
alleged personal criminal infractions (including
lapses in corporate governance Madam alluded
to) by some bank CEOs were found out, only
AFTER they had been removed from office.
26. My successor told me that the comprehensive
audit of the banks did not reveal such infractions.
Of course, you must be God or have a special tip-
off from inside to get to such information while
the MDs are in office. Unfortunately, all over the
world, no financial system has succeeded in
routing out all criminal behaviours by the
operators. So, Madam, I challenge you to provide
one shred of evidence that ‘there was no
separation between regulators and regulated’ or
be honourable enough to retract your reckless
statement.
27. What happened? The unanticipated and
unprecedented crisis of 2008/09 hit the world.
More than 40 US and European banks either
collapsed or were shaken badly (remember the
Lehman Brothers, Fannie Mae and Freddie Mac,
Wachovia, HSBC, Lloyds TSB, Citibank, Goldman
Sachs, even UBS, etc) and hundreds of billions of
dollars were spent to bail them out. The
contagion effects spread like a wild fire,
destroying national stock markets and banks. The
nascent (big) banks in Nigeria faced sudden
multiple shocks— liquidity, exchange rate, oil
price, capital market, etc.
28. As oil prices collapsed, loans to oil and gas
became non-performing overnight; loans to the
capital market became non-performing overnight;
etc. Our first priority was to save the entire
banking system and the economy from systemic
collapse. I assured Nigerians that no bank would
be allowed to fail, and not many people know
what it took to achieve it. Once we had navigated
through the unexpected /unprecedented
turbulence, we laid out a comprehensive plan to
clean up the debris which we presented to
stakeholders in Lagos (March 2009). I had
pleaded with the Senate to pass the AMCON bill
which we sent to them in 2004. But I had a
comprehensive plan to finish the clean-up with or
without AMCON by the end of 2009, including
second round consolidation and a N500 billion
fund (my book will detail all these). I left behind
an 11-volume document of the Financial System
Strategy 2020 (FSS2020) which has remained
the policy roadmap for the CBN/financial sector
since I left office.
29. I have two analogies for our experience. Ours
was really like an airplane that was cruising and
suddenly meets an unexpected and
unprecedented turbulence. After the pilots and
the crew succeed in navigating through the
potential crash and probably land the airplane,
people look in and start blaming the crew for the
broken tea cups, chairs, and drinks that fell
during the turbulence as evidence that the crew
never kept the airplane clean or serviced it. My
second analogy is that of a sudden earthquake in
a region it was never expected and some houses
collapsed. All of a sudden, the housing authority
is to blame for not requiring earthquake-proof
foundations for the houses. Well, my legal experts
call it force majeure, an act of nature!
30. To be fair, after every crisis, there are lessons
(and my book will detail what, with benefit of that
experience, we should have done differently). Risk
management— which has always been there—
now took a new centre stage all over the world
following the crisis. But for anyone to suggest
that CBN under me, for one minute, took its eyes
off the ball is, to say the least, ludicrous. The US
financial system literally crippled the world
costing America hundreds of billions of dollars but
no one has suggested that Alan Greenspan is no
longer the great maestro!
31. AMCON is a big topic (which I will address at a
later date) but her claims show either ignorance
or mischief. She claims that N5.7 trillion of
AMCON funds was used to rescue banks and the
‘bond issued’ as ‘cost to taxpayers’. Really? I will
deal with the AMCON I envisaged and the AMCON
under you later but let me state that even if
100% of the banks’ NPL was offloaded on AMCON,
it would not be up to N5.7 trillion. Enough said for
now. The fact is that the Federal Government has
not put a penny in the AMCON fund: the banking
system is financing itself, and together with the
sinking fund by banks, AMCON surely can’t
default (thanks to consolidation that the banks
are now big enough to cough out such funds to
solve the system’s problem). Did you intend to
deceive the readers by refusing to tell them that
much of the AMCON fund is ‘investment’ and not
‘expense’. Am sure you heard the IMF’s alarm
about moral hazard? If you want, we can have a
focused debate on AMCON.
32. Next, let me briefly respond to a few
outlandish claims. She brags about ‘single-digit’
inflation rate ‘now’ and alleges that when I left
office, inflation was above 13%. I just laughed at
this one. In Nigeria’s history, no governor of the
Central Bank has delivered 24 consecutive
months of single digit inflation as I did until the
advent of the unprecedented global crisis in
2008. It was not for nothing that the world
cheered us as monetary policy czar, Madam!
Perhaps you are also not aware that we broke a
world record by having a depreciated real
effective exchange rate during a time of export
boom and this was at the heart of our reserve
accumulation and the portfolio/FDI inflows.
33. I resisted the IMF advice to deplete reserves
for liquidity management, and Nigeria had
enough self-insurance to survive the global crisis.
The opposite has happened under you Madam,
and the Nigerian economy is in trouble. Naira
exchange rate appreciated under me from N133
to N117 before the global crisis; and reserves
grew to all time high of $62 billion. For the first
time since 1986, the official, interbank and
parallel market exchange rates converged under
me. You can’t match these records!
34. I hereby challenge your attempt to blame
others for not saving for the rainy day. It is not a
virtue when you are quick to appropriate all the
credit when things are going well, but shift the
blame when they go wrong. You blame the state
governors— who, according to you, have taken
the Federal Government to the Supreme Court—
not that a Supreme Court judgment forced your
hands.
35. For your information, the governors have
never agreed to savings and always threatened
court action even under Obasanjo. Why did we
save under Obasanjo but not under Jonathan?
Two keywords explain it: leadership and integrity.
Governor Amaechi said the governors insisted on
sharing the funds because they found out that
you were illegally fiddling with the savings. So, as
Nigerians still wonder, if billions of dollars are now
‘missing’ under your nose, why should governors
trust you to keep their money?
36. Do the states that have taken the federal
government to the Supreme Court and refused to
save also include the PDP governors—who are in
the majority? If so, then it is fatal: even governors
of your own party, PDP, do not trust you to keep
their money! Furthermore, did the governors also
stop the Federal Government from saving part of
its share? If you ran a surplus budget at the
Federal level, you would have had credibility to
blame others or to say they did not listen to your
advice. The key point is that since you were
running huge deficits yourself, it was also in your
own interest to share the ECA. You did not show
leadership or credibility, full stop!
37. Next, Madam, I was really embarrassed for
you to read that one of the reasons for declining
forex reserves is ‘oil theft’. Under you as Minister
of Finance and coordinator of the economy, the
basket of our national treasury is leaking profusely
from all sides. Just a few illustrations! First, you
admit that ‘oil theft’ has reduced oil output from
the average 2.3 – 2.4 million barrels per day
(mpd) to 1.95mpd (meaning that at least
350,000 to 450,000 barrels per day are being
‘stolen’. On the average of 400,000 per day and
the oil prices over the past four years, it comes to
about $60 billion ‘stolen’ in just four years.
38. In today’s exchange rate, that is about N12.6
trillion. This is at a time of cessation of crisis in the
Niger Delta and amnesty programme. Can you tell
Nigerians how much the amnesty programme
costs, and also the annual cost for ‘protecting’
the pipelines and security of oil wells? And the
‘thieves’ are spirits? Come on, Madam!
39. Second, my earlier article stated that the
minimum forex reserves should have been at
least $90 billion by now and you did not
challenge it. Rather it is about $30 billion,
meaning that gross mismanagement has denied
the country some $60 billion or another N12.6
trillion.
40. Now add the ‘missing’ $20 billion from the
NNPC. You promised a forensic audit report
‘soon’, and more than a year later the Report
itself is still ‘missing’. This is over N4 trillion, and
we don’t know how much more has ‘missed’
since Sanusi cried out. How many trillions of naira
were paid for oil subsidy (unappropriated?). How
many trillions (in actual fact) have been ‘lost’
through customs duty waivers over the last four
years? As coordinator of the economy, can you
tell Nigerians why the price of automotive gas oil
(AGO), popularly called diesel, has still not come
down despite the crash in global crude oil prices,
and how much is being appropriated by friends in
the process? Be honest: do you really know (as
coordinator and minister of finance) how many
trillions of Naira, self- financing government
agencies earn and spend? I have a long list but
let me wait for now. I do not want to talk about
other ‘black pots’ that impinge on national
security.
41. My estimate, Madam, is that probably more
than N30 trillion has either been stolen or lost or
unaccounted for or simply mismanaged under
your watchful eyes in the past four years. Since
you claim to be in charge, Nigerians are right to
ask you to account. Think about what this
amount could mean for the 112 million poor
Nigerians or for our schools, hospitals, roads, etc.
Soon, you will start asking the citizens to pay this
or that tax, while some faceless “thieves” were
pocketing over $40 million per day from oil alone.
42. You alluded to debt relief in your response
and tried to take credit. Well, your CV is honest
enough to admit that your two achievements in
office as Finance minister under Obasanjo were
that “you led the Nigerian team that struck a deal
with the Paris Club” and that you “introduced the
practice of publishing each state’s monthly
financial allocation in the newspapers”. You are
right about the two achievements. Let me put on
record that Nigeria would have secured debt relief
under anyone as Minister of Finance. President
Obasanjo secured debt relief for Nigeria. Much of
his first term was used to get Nigeria back into
the international community and to campaign for
debt relief. Before you were sworn in as Minister of
Finance, President Bush visited Nigeria and both
of us accompanied President Obasanjo during the
meeting. There, Mr. Bush promised to support
Nigeria with debt relief and asked our president to
ensure that he met the conditions of the Paris
Club. Obasanjo mobilized the global political
support and coordinated all of us to ensure that
the government met the check-list of
‘conditionalities’ as required. I spent five weeks
in the hotel with my team (as coordinator/
chairman for drafting the National Economic
Empowerment and Development Strategy,
NEEDS).
43. Some of the reform targets in NEEDS became
the ‘conditionalities’ Nigeria was required to fulfil
to merit debt relief. You and I signed the various
MoU with the IMF on behalf of Nigeria (the policy
support instrument). We had a great team at
work and each member of the economic team
had specific aspects of the conditionalities to
deliver: Bode Agusto was in-charge of the budget;
Oby Ezekwesili held sway at Bureau of Public
Procurement and later Minister of Solid Mineral,
and Education (but specifically tasked with
delivering on EITI and procurement reforms);
Nuhu Ribadu was at the EFCC fighting corruption;
I was at the Central Bank delivering on monetary
policy and banking reforms; Steve Oronsaye
worked hard to delist Nigeria from the FATF;
Nenadi Usman was in-charge of the parastatals;
El-Rufai held forth at FCT and in charge of public
sector reforms; privatization programme went on,
etc. Did you know that the IMF wrote President
Obasanjo threatening that there would be no
debt relief if the CBN did not meet some
monetary targets, and do you know the magic we
performed to meet them? Can you tell Nigerians
which of the ‘conditionalities’ that you personally
implemented? With the groundswell of political
support and Nigeria meeting all the
‘conditionalities’, debt relief was assured.
44. Your major role as stated in your CV was to
lead the team to negotiate the specific terms of
the relief, having fulfilled the conditions. I still
believe that Nigeria should have gotten far better
terms than you negotiated. Of course, with your
eyes on returning to the World Bank after office, I
did not expect you to boldly stand up to the
donor community in defence of Nigeria. Was
there a conflict of interest on your part?
45. By the way, can you tell Nigerians why you
were eased out as Finance Minister and you cried
like a baby begging OBJ to still allow you remain
in the Economic Management team—- barely few
weeks after the debt relief? Why were you
eventually also removed from the economic
management team if you were so important?
Ironically, President Jonathan has recycled you,
with a bigger title and greater responsibilities. But
the difference is that the team that did the actual
work is no longer there, and the world has seen
that the king is naked.
46. You are brilliant Madam, but you need serious
help. Having spent all your life in the World Bank
bureaucracy largely in administration/operations,
no one will blame you if your economics has
become a bit rusty. There are firebrand Nigerians
all over the world to draft to service. It is certainly
embarrassing to Nigeria for you to be bothering
World Bank economists to help you with most
basic economic analysis.
47. Your response on the poverty issue is deeply
troubling. You accuse me of using “2011
statistics on poverty by the NBS to support his
argument, while ignoring more recent figures”. At
least you did not refute the NBS figure as valid. In
the next sentence, Madam went ahead to note
that “as stated in the Nigeria Economic Report
2014 by the World Bank, poverty in Nigeria has
dropped from 35.2 percent of population in
2010/2011 to 33.1 percent in 2012/2013”. Did
you notice that you have quoted two figures for
poverty for the same year as being equally
correct? So, for 2011, was poverty 71%
(according to NBS) or 35% according to the
World Bank? To the best of my knowledge, the
last published household survey by NBS was in
2011. The World Bank does not conduct
household surveys in member states to determine
poverty incidence. So, when and by whom was
the survey that gave the World Bank figures?
48. What worries me is that this government is
the first in our history to attempt to manipulate
our national statistics under Okonjo-Iweala. When
NBS published the poverty figures in 2011, she
felt indicted and incensed. She called upon the
World Bank to come and examine the
‘methodology’ and get NBS to ‘review’ its
numbers. Oby Ezekwesili (as VP Africa Region
rejected the call to try to tamper with a country’s
statistics). Once Oby left, the ‘World Bank’ started
talking about ‘new figures’, without conducting
any new surveys. I was told about it by a World
Bank economist, and I cautioned that it was a
dangerous gamble that would damage the
credibility of the NBS. If you want to ‘review
methodology’, you conduct another survey but
you can’t change ‘methodology’ because you
don’t like the published figures. No government
in our history has tried it: even Sani Abacha
allowed a poverty survey that put poverty at 67%
under his regime. At this rate, who will believe
statistics coming from the Nigerian government
again? Is it now the World Bank that sits in
Washington and allocates poverty numbers to
Nigeria? Something smells here!
49. Madam alleges that the NBS—as a parastatal
under the National Planning Commission (under
me) departed from the ‘international standard
method of poverty measurement’. How and
when, Madam? I was in office at National Planning
for 11 months from July 2003 to May 2004. A
poverty survey was conducted in 2004 and the
results computed and published in 2005/2006—
more than a year after I had gone to the Central
Bank. Or perhaps, it was a clever way to divert
attention from your manipulation of published
economic statistics. The NBS published its
poverty data in 2006 when you were Minister of
Finance, and you did not question the
‘methodology’ because the figures looked good.
In 2011, the poverty numbers (using the same
methodology as in 2005/2006) indicted the
government and suddenly, the ‘methodology’ is
wrong. Interesting times!
50. Now that you decide which economic
statistics published by NBS to accept and which
ones to ‘change the methodology’ to give
favourable figures, you can keep feeding your
manipulated figures to your international media
circus for the vain glorious awards to sustain an
empty hype, while Nigerians groan under
hardship. We can actually ask Nigerians whether
they are getting better off now contrary to your
bogus figures.
51. Many of Madam’s responses were comical,
but this one is classic. According to her, the chief
economic adviser and NBS “worked hard to
determine how many jobs we need to create in a
year”, and went on to ask, “why didn’t Soludo do
this when he was CEA?” (Lol!). Madam, any good
economist needs less than 10 minutes to
compute this figure, not the (months? of) ‘hard
work’ by your team. My calculation is that the
number of jobs Nigeria needs to create each year
to significantly reduce unemployment rate to
sustainable levels in the next few years is at least
3 million, and not the 1.8 million by your team.
We are talking about the Nigerian economy,
please.
52. Your magic wand for mass housing is the
Mortgage Refinance Corporation with 23,000
mortgage offers—for a country with 17 million
housing deficit! Then, there is the pedestrian
proposal of a new development bank— financed
with loans from the World Bank, etc? A World
Bank loan to set up another ‘development bank’
where we already have Bank of Industry, Bank of
Agriculture, NEXIM, Federal Mortgage Bank, etc?
People have totally run out of ideas and can’t see
anything for Nigeria without through the prism of
the World Bank. I will offer you free consultancy
on how to set up a development bank without a
World Bank loan but we don’t need another one
now. I actually gave President Yar’adua a two
page note for a N3 trillion development fund
then, and if we plug your leaking pipes, it could
actually be a N10 trillion Fund. I envisioned and
set up the Africa Finance Corporation (AFC)—
Africa’s premier infrastructure bank!
53. Frankly, I don’t understand why you seem
highly troubled that the Soludo you thought had
“disappeared from the political space” seems to
be still around. Well, let me assure you that I will
only ‘disappear’ in God’s own time. I gave credit
to two past presidents who laid the foundation of
the market economy we operate today. You did
not contest or contradict any of my points.
Rather, what you see is that Soludo must be
‘looking for a position’. Pity! If I am looking for a
position, I would be running around one of the
candidates now just as you are busy dancing
Atilogwu dance at TAN and PDP rallies, struggling
to keep your job. How Yar’adua drafted me to
contest for governor in Anambra and APGA
leadership as well and how I was “stopped” on
both occasions are in the public domain. But I am
not deterred for one minute. Chinua Achebe said
that on leadership, Nigeria is a country that goes
for a football match with its 10th Eleven.
54. I am proud and happy to have offered to
serve my people, and for the service of Nigeria, I
will do it again and again. How many times did
Abraham Lincoln, Obama, Reagan, etc contest
before they got there? I actually encourage
everyone who believes he/she has something to
offer to get involved or stop complaining. I am
happy seeing the increasing critical mass of
professionals (like you) now getting involved. It is
good for Nigeria!
55. What is at stake is the survival and prosperity
of Nigeria. Next elections are critical, and for me
the key is the ECONOMY. We must offer Nigerians
clarity on the choices before them. Can I propose
a three-way debate with you (representing PDP/
Federal Government), nominee of APC (Utomi or
Fayemi? or any other), and myself (as
independent citizen— I don’t belong to any of the
two). Let us have two bouts of debate between
now and 12th February, 2015 focusing on: CBN/
AMCON and the financial system (if you want);
our economy and its outlook, and agenda/
alternative paths to sustainable prosperity post
elections. Choose the dates and times, and for the
sake of Nigeria, I will fly in. You can invite any of
your international media friends as moderators. I
feel the pain of the 180 million Nigerians whose
tomorrow you have carelessly rendered bleak,
and when I think of what the missing trillions
could do for them, it becomes extremely urgent
that we all must deepen the debate. Eagerly
waiting for your response, please.

1 thought on “Soludo Replies Okonjo-Iweala, Alleges Over N30 Trillion Has Been Stolen Under Her Watch

  1. I’m still learning from you, but I’m trying to reach my goals. I definitely liked reading everything that is posted on your website.Keep the aarticles coming. I enjoyed it!

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