discouraged (the government) from borrowing and the Nigerian desk and the world Bank suffered the consequences.

If you check, you would see that if the World Bank country director does not lend, it is either he is demoted orremoved. But, it isourresponsibility to makesurethat the lending is useful to us.”

Professor Ode Ojowu, Weekend Trust, December, 21, 22, 2024.

Professor Ojowu, former Chief Economic Adviser to President Obasanjo and member of member of Bu­hari’s Economic Advisory Council, has been around the corridors of power for a long time by virtue of being a very good economist, and one of the few from the North for a long time.

He was a member of the VISION 2010/20 group; served Abacha, Obasanjo and Buhari. Like any pair pf economists, we have had reasons to disagree; be­cause no economist in government can be totally pro­fessional. And, no economist, not in government, can failtonoticewhenour colleaguesinpower havejoined the government in deviating from sound economic principle.

Two weekends ago, in a lengthy interview with the Weekend Trust, Prof was at his best in taking us throughpoliciesof variousgovernmentsandhowwe landed in our current mess.

However, beforegoingintothesubstanceof thisar­ticle, thereisanotherpointof disagreementwithProf.

No To VAT Reduction

“Tinubu should reduce VAT to 5%.” – Professor Ojowu.

At least three things should not be subject to pop­ular opinion – court judgments, election results and the advice given by professionals to governments on national affairs – especially, economic advice.

Onatleasttwooccasionsinthepast, Prof andIhad disagreed on important matters.

He was one of the apostles of VISION 2020 – those who told Fellow Nigerians that their country would be among the top 20 economies by 2020.

I was the only economist to disagree. In 2020, Nige­ria was ranked 31; and the country is on track to dive below 40 in 2025.

The Value Added Tax, VAT, was another issue on which I was one of a small minority of economists who supported it.

Now, it is raking in trillions into government cof­fers. It was 5% for years, despite our recommendation that some of it be reviewed upwards every five years – untilitpeakedon15% forluxurygoodsandalcoholic beverages.

ItwasnotuntilBuharithattheratewentupto7.5%. Thetrillionsof taxrevenueNigeriawouldhavecollect­ed between 1998 and 2022 is incalculable. We should certainly not be in half the debt we now owe.

Tinubu has proposed 10 per cent from 2025; Prof is notcontentedtoleaveitat7.5%; hewantsVATslashed to 5% while ignoring the economic consequences. That can’t be right. The truth is VAT rate reduction will reduce revenue-generation and induce more borrowing.

There must be a limit to borrowing and mortgag­ing the future of our children and grandchildren.

Debt Addiction Is Becoming Fatal To Nigeria

“Addiction makes you blind to your reality”. Brittany Burgunder

“Debt is the opium of the governing classes.” Dele Sobowale, 2004.

That said; I want to return to my main reason for thisarticle– Nigeria’sdebtaddiction. Everyaddiction creates its own optical and mental illusion; the feeling in the victim that a little more of the stuff will solve the problems.

Thedemandformorecreatesthesuppliers– those who feed on the sickness.

Nigeria’s debt-addiction is mirrored everyday by my neighbours in Lagos Island.

I decided years ago to borrow an example from US President Clinton; who opened his office in Harlem, New York – a mostly black ghetto.

It is impossible to write or talk about poverty or the problems of the poor unless you live with the poor daily.

Drugaddiction– peddlingandconsuming– isalso most openly on display here. The addicts want more; and the peddlers want more money.

The latter encourage the former to take a little more; build more debt to be discharged and more crimes to commit to redeem the loans.

Few of those who were known to be addicts have kicked the habit; most died with their addiction un­diminished.

Nigeria’s governing classes, since 1999 has proved merightconcerninganobservationmadeatalecture in2004– shortlyafterDrOkonjo-Iweala, asObasanjo’s Finance Minister, got Nigeria out of the choking debt-trap created by Obasanjo-Shagari-Buhari-Babangi­da-Abacha-Abubakar-Obasanjo again.

I was asked during the lecture titled: Way Forward After Debt Forgiveness, what Nigeria should do?

My answer was: “avoid going into debt again; espe­cially debt owed to the World Bank.”

But, I quickly added, that “Debt is the opium of the governing classes. Before long Nigeria will again be in another debt-trap; and the World Bank would have laid the trap.”

Today, just 20 years after we exited one trap, we are in a bigger trap. Here is why.

Whereas an investment bank would scrutinise your loan application to make sure that the project is viable; and even offer support to manage it success­fully, theWorldBankoffersloanstogovernmentswith the same reckless abandon as the drug dealers in my neighbourhood.

They recklessly offer loans to governments whose budgets and proposed deficit are spurious; and whose records on corruption guarantee that a substantial percentage of the loan will be embezzled.

After, creating the conditions that ensure that nothing succeeds, others in the same bank would later write beautiful stories about the failures.

It has been baffling to me for a long time how each government since 2005 had fallen into the quick sand so easily.

Professor Ojowu’s interview has enlightened me regarding the nature of our debt problem and the World Bank connection.

“In a sick country, every step to health is an insult to those who live on its sickness.” Bernard Malamud, 1914-1986, in THE FIXER.

It is remarkably similar to drug addiction. Taking the easy way out of problems by our leaders has landed Nigeria in the willing arms of those benefiting from oureconomicsickness; whichisperpetualborrowing and spending revenue we have not earned and which we might never earn.

Liketheoperatorsof thosedeadlyoutfits, itisnever their intention for us to kick the habit – which is stron­ger than reason.

It is also not in our own interest to be perpetual­ly hooked. Professor Ojowu has revealed to us that a World Bank Country Manager is not an economist offering disinterested advice to the nation and who collates data without bias.

Instead, he/sheisactuallyanEconomicSalesman with a loan target to achieve. As any Marketing/Sales Manager, with a careerto protect, wouldtell you, strict adherence to truth is not a top priority if it would im­pede sales.

Consequently, theWorldBank has not always been honest with us.

Certainly, none of theirreports predictedthat there would beadrasticnegativevarianceinactualrevenue by the Federal Government in 2024; or that exchange rates would rise to N1600/US$; or that inflation would gallop to 34.8% before the end of last year or that cash scarcity would bedevil the Nigeria economy.

The truth is; the World Bank’s Nigerian office missed all the variables which have made the loans being offered for 2025 inevitable.

With such “friends”, who needs enemies? Ojowu hastoldusthetruth. WorldBankloansarenotgranted primarily tohelp us; buttofeed our addictionfor loans – irrespective of benefit to the people of Nigeria. The only beneficiary is the World Bank.

Follow me on Facebook @ J Israel Biola.