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Deregulation
and beyond
The entire
Nigerian scene is very bleak indeed. So bleak that people ask me: where do
we begin?� These are the exact words of Chief Olusegun Obasanjo in his
inaugural speech on May 29, 1999 as the elected president of the Federal
Republic of Nigeria. To be sure these words succinctly captured the state
of the nation pre-May 1999. The Nigerian state was literally a failed and
little better than a rogue state. Infrastructure in all sectors of the
economy and all facets of society was collapsing with alarming rapidity.
Every citizen was becoming a mini-state in his/her own right as public
goods became privately produced. Thus you have to provide your own
security of life and property; generate your own electricity and water �
even after paying the necessary taxes and bills; employ private teachers
for your children after paying their school fees and even go ahead to
construct your own roads! The only way to re-direct things was through
radical reforms.
A key feature of the economic
liberalization policy is deregulation and this simply means the process of
giving free reign to the logic of the market place. In simple language,
deregulation is the process of allowing the forces of demand and supply to
determine the price of goods and services. This presupposes the complete
removal of all government interference in the price mechanism either by
way of bearing the full cost of production or by subsidizing
consumption.
Generally, the policy of
deregulation caries with it a plethora of advantages. They include the
promotion of efficiency and the elimination of wastages. It was this
inefficiency occasioned by stupendous waste that government was actually
subsidizing. This waste and inefficiency also presented itself in the form
of corruption and indiscipline. Thus by deregulating certain sections of
the Nigeria economy, Obasanjo is in fact insulating and protecting
Nigerians from rapacious and ravenous party men and women positioning
themselves for the sharing of the booty of their poll
victory.
Second, a deregulated economy
is private sector-driven, and muatis mutandis, promotes competition. This
competition among producers and suppliers can only be in the interest of
the people as it carries with it better quality goods and services and
thus presenting to the customer an unimaginable array of alternatives. And
this has the potential of forcing price down in the long
run.
However one area where
deregulation has run its full course is in the Telecomms sector. Beyond
that, deregulation became an instant hit as telephony, which was
previously described as rich men�s pastime became dangerously demystified.
Today, ownership of a GSM or fixed wireless phone is no longer a class
thing courtesy of deregulation! Before now, there were only a few lines
available for those who had the money to buy anyway. Even so, the service
was so bad that it could take more than week to make a successful call
whether local or international. The only reason behind that atavistic
situation was that NITEL held the monopoly and government was paying for
its inefficiency and ineffectiveness.
It is against this background
that government finally decided to deregulate fully the down stream sector
of the petroleum industry. Rather that accept this noble policy that would
be in the interest of the masses, critics of government and those
benefiting from the inefficiency of the old order went to town to clobber
and discredit the regime and its principal officers. Is it therefore not
intriguing that the same deregulation, which was, not only welcome but
also applauded in the communication industry is now being ignorantly
opposed in the petroleum sector?
However one deducible reason
against the deregulation of the down-stream sector of the oil industry may
be the fact that oil accounts for over 70 per cent of Nigeria�s revenue.
And to that extent we have foolishly conditioned our minds to the
erroneous view that Nigeria has no future after oil. In fact, this for me
is the greatest reason to support the deregulation if only to help us
diversify our economy by looking toward other centers of the revenue like
agriculture and tourism.
Maximus
Osulase,
Sokoto State
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