KOWA YA TUNA BARA!
GENERAL SANI ABACHA: DEVELOPMENT POLICIES AND INITIATIVES OF HIS ERA
A Special Investigation by Alfijir Labarai
EDITION 2
In Edition 1, we examined some of the major issues associated with the Petroleum Trust Fund (PTF), road rehabilitation, education, healthcare, water supply, the creation of six new states and Vision 2010.
In this Edition 2, we continue our examination of policies and programmes of the Abacha era, focusing particularly on the economy, foreign reserves, family support, small-scale enterprises and public financial management.
1. GROWTH IN NIGERIA’S FOREIGN EXCHANGE RESERVES
One of the notable economic developments between 1995 and 1997 was the significant increase in Nigeria’s gross official foreign reserves.
IMF data shows that gross official reserves increased from about US$1.4 billion in 1994 to US$1.8 billion in 1995, before reaching approximately US$7.5 billion by the end of 1997.
The improvement occurred largely in the context of stronger oil export earnings and an improved external position. Crude oil accounted for more than 95 percent of Nigeria’s total exports during the period.
The increase in reserves is therefore an important part of the economic record of the period that deserves to be examined alongside the policies and circumstances that contributed to it.
2. IMPROVEMENT IN THE FISCAL POSITION
According to the IMF, Nigeria’s consolidated government fiscal position improved substantially between 1995 and 1997.
After recording an overall deficit equivalent to 8.8 percent of non-oil GDP in 1994, the consolidated government recorded overall surpluses for three consecutive years.
The IMF attributed the improvement to higher revenues and relatively lower growth in public expenditure. Increased petroleum revenues were an important factor, while expenditure growth was also contained during parts of the period.
In 1997, the consolidated fiscal balance remained in surplus at about 2.6 percent of non-oil GDP.
This provides an important economic indicator for understanding the fiscal position of Nigeria during the period.
3. FOREIGN EXCHANGE POLICY AND “GUIDED DEREGULATION”
The Abacha administration introduced significant changes to Nigeria’s foreign exchange system beginning in 1995.
Among the measures was the establishment of the Autonomous Foreign Exchange Market (AFEM), alongside a policy described by the government as “guided deregulation.”
The IMF records that the 1995 measures represented a substantial liberalisation of the exchange system and were accompanied by efforts to restore fiscal and monetary discipline.
The reforms also included the abolition of the Exchange Control Act of 1962 and the introduction of a new legal framework for foreign exchange transactions.
The policy was intended to give market forces a greater role in determining exchange rates while maintaining government oversight and intervention where considered necessary.
4. FAMILY SUPPORT PROGRAMME — FSP
The Family Support Programme was introduced in 1994 under the leadership of Mrs. Maryam Sani Abacha, during the Abacha administration.
The programme was designed around the family as a central unit of social and economic development, with areas of focus including healthcare, education, agriculture, income generation, women, children and vulnerable groups.
Its health-related activities included support for programmes such as immunisation, maternal and child healthcare and community-based primary healthcare.
The programme also sought to help families identify economically viable activities and improve agricultural productivity, particularly in rural communities.
FSP therefore represents one of the social-development initiatives associated with the Abacha era.
5. FAMILY ECONOMIC ADVANCEMENT PROGRAMME — FEAP
The Family Economic Advancement Programme was established under the Family Economic Advancement Programme (Establishment, etc.) Act, 1997, which commenced on 12 August 1997.
The programme was specifically designed to support local producers of goods and services, potential entrepreneurs and the development of cottage industries.
Its objectives included providing support and credit facilities for eligible beneficiaries and encouraging economic activities based on local production.
FEAP was therefore another attempt during the period to strengthen small-scale economic activity and entrepreneurship at the grassroots level.
6. ADDRESSING FINANCIAL-SECTOR DISTRESS
Financial-sector problems were also identified as an important economic issue during the Abacha administration.
The 1996 Budget of Consolidation included a specific section titled “Resolving Financial Sector Distress,” alongside policies covering monetary and credit policy, exchange-rate policy, interest rates, capital markets and other financial matters.
The same official budget document also included the 1996–1998 National Rolling Plan and outlined the government’s broader economic policy direction.
It is important, however, to distinguish between identifying a problem and completely solving it. The historical record establishes that financial-sector distress was recognised as a policy priority; it does not mean that every problem in Nigeria’s banking system was eliminated during the period.
7. NATIONAL ROLLING PLAN 1996–1998
In 1996, the Abacha administration presented the National Rolling Plan for 1996–1998 as part of its medium-term development planning.
The official Budget of Consolidation preserved by the National Library of Nigeria covers areas including economic policy, agriculture, industry, taxation, trade, monetary and credit policy, exchange-rate policy, ports, youth development, women in national development and other sectors.
The plan demonstrates the administration’s attempt to organise national economic and development policies within a medium-term framework rather than relying exclusively on annual budget measures.
WHAT SHOULD WE REMEMBER?
The historical record of the Abacha era includes a number of economic and social policies that deserve to be examined beyond the political debates surrounding the period.
Between 1995 and 1997, Nigeria experienced a substantial increase in gross official foreign reserves and recorded consolidated fiscal surpluses. The period also saw changes to the foreign exchange system and the introduction of programmes such as the Family Support Programme and the Family Economic Advancement Programme.
The administration also placed financial-sector reform and medium-term national development planning among its stated policy priorities.
But this is not the end of the investigation.
In the next edition, Alfijir Labarai will examine agricultural development and other areas that remain to be covered, looking closely at what was planned, what was implemented and what the historical records reveal.
KOWA YA TUNA BARA!
By Alfijir Labarai
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