The Legal and Economic Implications of Nigeria’s Political Impasse

It is a well-known fact that a stable political environment is a prerequisite for the advancement of economic pursuits. The system of democracy – whereby citizens of a country elect their government representatives at local, state and federal levels – is globally understood to be a significant factor in ensuring economic prosperity.

Problems arise when the process of transition from one government to another is considered a “do-or-die” affair. The prospect of an upcoming election becomes a worrisome omen, foretelling troubling legal and economic days ahead.

The 18th-century Scottish poet Robert Burns concluded his poem about the First War of Scottish Independence, Robert Bruce’s March to Bannockburn, with the following rallying cry:

“Lay the proud usurper low!
Tyrants fall in every foe!
Liberty’s in every blow!
Let us do or die!”

Throughout Nigeria’s political history, the landscape has seldom been as impassioned as it presently is. Coverage of the recent presidential election in February 2023 has been dominated by political assassinations of opponents, the unleashing of violence, and a legal challenge to the presidential election that has become the most eagerly awaited in recent memory.

When it comes to the democratic process, a “winner-takes-it-all” mentality – while often a matter of political reality or expediency – is not the best for business. It usually signals the flight of investors and a reluctance on the part of new investors to enter. Businesses thrive on certainty and the guarantee that relevant laws will be obeyed by the elected officials and administrators.

The rumbling of oncoming storms can already be heard in key sectors of the Nigerian economy. Some investors have resorted to withdrawing their investments or not making new ones until the political direction of the country is clearer.

The unending political drama in Nigeria has been driven largely by the self-interest of some in positions of power. As ever, the inability to distinguish between personal and national interests is a patent recipe for economic disaster.

For many months, Nigeria was caught in the grip of a currency scarcity that saw citizens lining up in front of automated teller machines from the early hours of the morning. A currency redesign plan was devised, which allegedly aimed at mopping up excess cash outside the banking system and curtailing the epidemic of kidnapping and terrorist activities for ransom payment. However, the scheme was fiercely opposed by a number of government leaders.

The Supreme Court intervened at the instance of certain ruling party leaders and extended the validity of the old currency notes from its deadline of 10 March 2023 to 31 December 2023. This course of action by the Supreme Court has – perhaps unwittingly – brought about a resurgence in acts of kidnapping, banditry and terrorism, which had reduced significantly following the earlier decision to discontinue the usage of higher denominations of the naira.

The Grammy-winning song ‘The Gambler’ sums up the gambler’s creed best. In the 1978 hit by Kenny Rogers, the evergreen country musician croons: “Every gambler knows that the secret to surviving is knowing what to throw away and knowing what to keep.”

At the federal level, there has been much fist pumping and chest thumping by the outgoing Buhari administration concerning its lofty achievements, which it believes history will remember favourably. And, in truth, there have been some remarkable legal strides. The following few examples should suffice.

However, as the gambler’s creed suggests, there are some things that the outgoing administration should have thrown away. The following are among the problems that persist.

It is an abiding mystery why corruption continues to remain the Achilles’ heel of the Nigerian state and economy. One reason, perhaps, is the lack of political willpower to deal with offenders on account of party, ethnic and religious loyalties and affiliations.

Nigeria boasts an impressive suite of legislations aimed at detecting and dealing with the problem of corruption, including:

Despite the above, instances of high-level corruption still abound. The National House of Representatives is currently investigating the theft and sale of 48 million barrels of crude oil valued at USD2.8 billion. The outgoing government is bequeathing the incoming regime a plan to remove the highly corrupt fuel subsidy scheme without having rehabilitated any of its five refineries, which annually drain millions of dollars in turnaround maintenance. The labour unions have threatened to shut down the country if the subsidy is removed before the refineries are functioning.

The role of the Nigerian state and economy is critical not only in the West African region but to the whole African continent. As such, there is an expectation that careful attention will be paid to resolving the current political impasse in Africa’s economic colossus.

With ongoing accusations and counter-accusations raging among representatives of the major political parties, a great burden rests on the judiciary that will be the final arbiter. It must determine whether the slumbering giant experiences a reawakening or remains in a state of decline.