AFRICA CONFIDENTIAL
The new government due to take office at the end of this month faces a dizzying array of financial and political challenges, including questions about the health of its leader Bola Tinubu, who has just returned to Abuja after a month’s break in Paris.
Top of the list is the financial impasse: serious short-term revenue shortfalls and mounting debt service payments due in the next two years. Added to this is a brewing political row over Tinubu’s commitment to scrap the fuel subsidy programme, which has been costed at over US$12 billion this year (AC Vol 64 No 8, Asiwaju Tinubu the taxman cometh).
The top four presidential candidates had earlier agreed to scrap the subsidy. Late last month Finance Minister Zainab Ahmed signalled that the subsidy would continue until 1 June at least, suggesting that the incoming government was not planning its removal as soon as it took office.
This means that one of the Tinubu government’s first acts will be to amend the 2023-2024 budget to include financial provisions to pay for the continuing fuel subsidy scheme. That would involve appropriating another $6bn at least.
Another key policy focus will be on how the government intends to address corruption concerns. This has been given added salience after recent media coverage about the failure of President Muhammadu Buhari‘s government to prosecute such figures as former oil minister Diezani Allison-Madueke and oil trader Kola Aluko whom it accused of grand corruption.
Detailed reports published by Nigeria’s Premium Times and Bloomberg news on 2 May, revealed that in 2017 a company owned by President-elect Tinubu’s son Seyi bought a US$11m London mansion formerly owned, then forfeited, by Aluko after he failed to keep up mortgage payments.
At the time the house had been repossessed by Deutsche Bank but Nigeria’s Economic and Financial Crimes Commission (EFCC) was also seeking to seize the property having earlier said it was seeking to arrest Aluko for grand corruption.
The news reports emphasise that they don’t imply that President-elect Tinubu has any link to the transactions over the forfeited mansion but they raise several questions about the political wisdom of his son’s association with Aluko’s house…
