Business
Utomi, Atedo blame low foreign investment in Nigeria on shabby justice system
Okey Onyenweaku
A country without an effective, reliable and equitable justice system and one that can assure confidence in her citizens is likely to lose huge investments from both domestic and foreign investors.
Palpable fear is now disturbing the minds of discerning Nigerians given the high level of distrust over the seemingly embarrassing court judgments which pervade the country, especially recently.’’ How can you invest in a jungle where there is no rule of law? An investor who wouldn’t want his name mentioned in print told BH.
There is a consensus that Nigeria of today, arguably the largest economy in Africa may be drifting to compete with the category of countries where judgement is obtained based on a persons’ status or the weight of a persons’ pocket.
Many both in Nigeria and all over the world have faulted recent tribunal processes in which Presidential Election Petition Court (PEPC) dispensed judgement in favour of the All Progressive Congress (APC) in support of Tinubu’s controversial election as President of Nigeria.
The tribunal in fact, dismissed the Vice President Atiku Abubakar of the Peoples’ Democratic Party (PDP) and Peter Obi’s Labour Party applications challenging recent presidential election that returned Asiwaju Ahmed Tinubu as dully elected. The elections were believed to have been marred in irregularities, violence, suppression among other illegal measures that attracted bad press even from foreign electoral observers.
Some critics have expressed doubt that the Nigerian judicial system (the courts) was capable of reflecting and defending the people according to the assertion that the court seems to be the’ last hope of the common man’.
Some lawyers including two Senior Advocates of Nigeria (SAN) Olisa Agbakoba and Femi Falana have accused the government that should ordinarily maintain laws and order, of being the ones that do not obey the laws they made, especially when court judgements are against them
Whereas the Nigerian economy has remained weak in the past 12 years, it has recently become weaker in all measurement indicators since the new government assumed office in May 29, 2023.
Recent statistics have revealed that while inflation has surged to 26.7 per cent from 22.79 in June 2023, food inflation jumped to 30 per cent, the Naira exchanges for a dollar at over N1000.
Nigeria’s total debt stock according to the Nigeria Bureau of Statistics (NBS) stood at unprecedented N87 trillion while insecurity has spread to every nooks and crannies of Nigeria with increased kidnappings for ransom, killings, banditry, robbery, gangsterism, cultism, drug abuse and the nefarious activities of the unknown gun men, it is difficult for businesses to operate at their optimum.
Political instability, poverty and anguish have in fact, suppressed the populace as Nigeria has become the poverty capital of the world.
While the judicial system and some justices continue to lose credibility by the day because of increased doubt of obtaining justice at the courts, jungle justice is fast gaining ground as a way of settling disputes.
Aside other challenges, recent controversial electoral judgments from our courts have been fingered as hugely responsible for the worsening of the country’s economy.
Research revealed that investors are really scared to trust such countries as Nigeria with their investments despite having a potential to give higher returns.
In fact, Nigeria’s weak disposition has already denied her of huge investments.
Frustrated by the deplorable conditions, Prof. Pat Utomi, described Nigeria thus:
‘’You look and say you can trust people. You can send Nigerian delegations to New York and everywhere to invite investors as we have been doing everywhere but they will finish and come up with nothing because they may say nice things in front of us. But they will say that country of crooks why should I go and put my money there?’’
Nigeria’s economy whose Gross Domestic Growth is as low as 2.3percent and expected to drop further before the end of the year, appear to be losing faith with foreign investors.
Details show that total capital importation in the q2 2023 was $1,030.21million lower by 9% than the $1,535.35million in the corresponding period of 2022. It also fell by 9.04 per cent from$1,132.65million in the preceding quarter of 2023 an indication that investors’ confidence is waning.
Many have frowned at the increasing Nigeria’s fiscal deficit in 2022 which hit N7.5trillion exceeding the budgeted N5.2trillion. Also worrisome is the decline in revenue to N5.8trillion from the budgeted N9trillion and lower than the N6.7trillion achieved in the corresponding period of 2021. Though above statistics are for the previous year, but foreign investment into the stock market fell Year on Year, ( YoY) by 40.4% to N145.08 billion in the first half, HI’23 from N243.48 billion in H1’22 reflecting low confidence in Nigerian economy.
Nigeria according to research is degenerating into similar conditions as Pakistan, Bolivia, Egypt, Bangladesh, Venezuela, Zimbabwe, Cambodia, Cameroon, Afghanistan, North Korea, Syria that have been categorized as nations with questionable justice system.
Other countries with the worst economy and are in this category include, Burundi, South Sudan, Central African Republic, Syria and Yemen. While it is difficult to pinpoint a single cause for poverty in these countries, characteristics of corruption, exploitative colonization, weak rule of law, war, social unrest, severe climate conditions, insecurity high debt and poorly educated work force have challenged them in serious terms.
BH investigations reveal that effectiveness of government checks openness of government, absence of corruption, upholding the tenets of fundamental human rights security, effectiveness of government agencies and Access to justice are determinants of a good judicial system.
But former chairman of Stanbic IBTC, Mr. Peterside Atedo, finds it difficult to fathom what a mess the countries judicial system has become and wonders how we expect to attract investors into a nation where cases can be misinterpreted and cause applicants great harm.
“I am more concerned about what it portends for the future and future elections. If we wipe out all the gains we can as well ask INEC or DSS to tell us who they want to announce as the winner because the burden of proof is so high for those who have been wounded by the system”.
‘’I am happy you asked that question because it is a complex whole
Investors come to a place where they are confident. It is just not about the potential of getting a return. Who wants to invest in a place if you believe there is no law and order? Who wants to invest in a place if believe some judges can just wipe you out with a wrong interpretation of your case.?
‘’So, the point I am making is that you cannot just tell the whole world to come to Nigeria and make investments. Initially they will wait and see what you have to offer. How good is your judiciary. Those things matter. He said.
While the Chairman, Association of Securities Dealing Houses of Nigeria, Sam Onukwe, blamed insecurity, inflation rate, taxation of market instruments, government’s management of debt, funding budget deficit as part of the reasons foreign investors are leaving the equities market, others agree fear of injustice in the system are involved in scaring investors.
Unfortunately, former deputy governor of the Central Bank of Nigeria (CBN) Prof. Kingsley Moghalu described the Nigerian economy as distressed and bankrupt.
‘’Nigeria’s economy is deeply distressed.Nigeria is practically bankrupt. There is no question in my mind about that. Poverty is increased to unconscionable degree, unemployment is about 40%, the Naira is in distress. Yes the economy is in bad shape and there is no question about it.’’ Said Moghalu
Caution has become the watchword for many investors both Nigerians and foreigners who ordinarily would put money to make money in the country.
