Nigerian Association of Energy Economists, NAEE, yesterday, expressed concern over the protracted reforms in the energy industry, notably power, oil and gas, saying that these reforms, which are over 10 years now, should have been concluded and yielding results.
The association also said the development has led to loss of confidence in governance by the people and prospective investors, who would have brought in funds to boost econimic development.
Speaking with newsmen in Lagos, President of the Association, Prof. Adeola Adenikinju, identified several factors mitigating the progress of the reforms to include: lack of political will to see reforms through due to varied special interests, which have been used to either slow down the processes or reverse them completely; alienation of Nigerians and other stakeholders from the reforms, leading to resistance in implementation, especially the power privatisation, deregulation of the downstream and passage of the Petroleum Industry Bill, PIB; intra-government conflicts with those for and against the process working to undermine one another’s interests, which for instance, have kept the PIB in the National Assembly for more than 10 years.
Also, this is indicative that the reforms may not have the full support of those in government’s top hierarchy. Policy swings and disruptions of timelines leading to credibility gaps among investors and target misses and loss of confidence in the process. Lack of sanctions for missing targets has ensured continuous policy somersaults and lack of commitment to set targets, notwithstanding the institution of performance bonds by the current administration.
Adenikinju noted that the resultant effects of the above is that even where some progress had been made like in the area of power privatisation, the major international players shunned the process, leaving only the second and third level companies bidding for the electricity assets.
For the reforms to progress as desired, the Professor of Energy Economics, argued that “there must be some confidence building measures, which must precede such a major policy.”
He added that in the Nigerian environment such confidence has been taken for granted, leading to lack of understanding and mistrust of government policies and subsequent resistance, as has remained the case with fuel pump price increases.
He maintained further, “we need sufficient evidence and data based on adequate research to back up such policies. There is a dearth of data, so most policies are based on intuition. There is no evidence to support, drive and effectively guide the path of the policy reforms.
“For instance, during the last public hearing on fuel subsidy, there were no data to show how much fuel come from the refineries, how much is the daily consumption and how much is imported or exported, everything was shrouded in secrecy.”
Against this backdrop, Adenikinju said, this is why theme of the Associations’ forthcoming 6th NAEE/IAEE International Conference, is on “Energy Resource Management in a Federal System: Challenges, Constraints and Strategies,” holding in Lagos between April 22 and 23.
He noted that resource management and control have become very controversial in the recent times, adding that discussions on the issue will focus around preserving that natural resources for the benefits of present and future generations.