To wealth creation expert, Dr. Olumide Emmanuel, the N70,000 minimum wage agreed by Federal Government and organised labour unions is not a living wage. He talks about this and other sundry issues in this interview with Platforms Africa. Excerpts;
Crises create opportunities. But most of the time when people are in crises, they are in despair. They are not in a mental state to be able to see, seize and maximise opportunities.
The federal government recently approved N70, 000 as the minimum wage. How does this amount hedge against inflation in view of the economic realities?
If you look at it from the point of the exchange rate, you will realise that even though it has increased at the naira level, it is a reduction at the dollar level. In the last few months that this debate has been going on, we have been having true vocabularies that have been pushed simultaneously, minimum wage, living wage. Right now the minimum wage has been increased, but the living wage has still reduced. So, in naira terms, the minimum wage has been increased but in living terms, peoples’ quality of life has reduced. Even if you have N100, 000 now, it cannot buy what N30, 000 could buy a year or two ago.
Can you shed more light on what it means for the purchasing power of the people?
The United Nations has defined living below $2 a day as poverty and living below $1 day as extreme poverty. 75 per cent of Nigerians live in poverty because at the present excnage rate the new minimum wage amounts to $43 meaning it is less than $2 per day. So when you talk about peoples’ purchasing power, it is becoming weaker and weaker and weaker because their take home cannot take them home. What they are earning, when taken to the market, cannot get them basic needs and the basic requirements of life. If you look at what has happened, you will discover that everything around us has increased and inflation is at the highest it has ever been. It is not going to get any better except the people at the helm of affairs, the policy formulators do all that is required for things to change. What happens in this country is that we always look for one solution that fits it all, but it doesn’t work like that. You may bring in a good policy, but in order for that policy to work and produce a good result, there are many other things that you may also need to do simultaneously that will work in tandem with that policy that you formulated. But most of the time, we only do one and expect that it would be the magic wand that will produce the miracle. But it doesn’t work like that.
The inflation rates keep rising and currently at 40%. Is there no way of curbing it?
You know doing the same thing over and over again and expecting a different result doesn’t bring out the best result. We are not a productive economy and when you are not a productive economy, what do you have to back your money with? When you talk of market forces, it’s a force of demand and supply. There is no way there will be no inflation because due to a potpourri of expenses the cost of production locally is higher than imported goods. The solution is to come back home. Let us lock ourselves in and go indigenous. Put a high level of duty on anything imported, including on food. When you say eat Nigeria, you will begin to see Nigerian products coming on. Then we need to cut the cost of governance. Many nations that have succeeded have to first lock themselves in and shut out the world so that they can focus on themselves and their strength. When they now discover themselves they can now open up and begin to welcome the world. We have seen many nations that have done that. But as long as we are following all these IMF and World Bank colonial colonisers and bowing to their colonial bondage, we will go nowhere.
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If we get just one single policy, then you will see the economic boom it will produce. Also, what are all these senators doing? If you want to be a senator, be a volunteer. No more payment, no more salary. If you truly love Nigeria, come and serve voluntarily, we need people who have made money in the secular world and the market place who will volunteer and who will give us just three of their days once in a month. Whatever needs to be done, they will do it in that three days.
So with all that is going, how will you assess the economic policy of the current administration. Are they doing anything to address the issues?
Almost all the policies of this administration is the right policy. But one answer does not fit all. They do the right policy but for that policy to work there would be other things that need to be in place. Ironically, those other things, they are not doing. Take for instance the Oronsaye Report on reform of the civil service; it is a good move. But while they are implementing that, they are also setting up other parastatals, thereby negating a good policy. Removal of subsidy is also good. But all those doing bunkering should also be called to book. You are floating dollar and still buying cars in dollars. The implementation of the policies and other supporting policies are not being done.
When do you think the gestation period of these policies will expire and results be seen?
Normally the gestation period of a policy, if well implemented, is supposed to give results within six months and two years maximum, depending on all other factors being equal. So, it is those ‘factors being equal’ that we are on right now. For instance, we know that we need to produce to bring dollar and the only thing that brings dollar to our economy is the crude; but we keep borrowing money in advance against our crude oil. So there is no income from there. Right now we are borrowing money to pay salaries and borrowing money to run government. Well, we have seen one year of these policies so let us still watch what happens in the next one year. If you eat your tomorrow today, you are going to be dimensionally poor. We have so many illegal refineries everywhere. In political leadership, there is what we call the psychology of leadership, sometime it is not black or white but grey. So the principle of amnesty, whistle blower and plea-bargain are all principle of grey area leadership. Let us legalise the modular refineries. These modular refineries exist everywhere, especially in Port Harcourt and that is the oil that many people are using for their cars and generators and everything is working. When we legalise them, we will begin to collect taxes from them.
What measures do you advice government to take to regulate the impending minimum wage-triggered rise in the cost of commodities in the market?
Price control is a very dicey thing to do, especially, when you are not giving any form of subsidy, palliative or alleviation in the value chain.
In view of all these, what are the chances of Nigerians creating wealth for themselves and what measures can an individual deploy to survive?
The principles are always the same and ever the same. Why? Because crises create opportunities. But most of the time when people are in crises, they are in despair. They are not in a mental state to be able to see, seize and maximise opportunities. The question should be, what value are you bringing to the market because money flows in exchange for value (goods and services). So any individual can thrive if they just identify the source of value they can create for money to flow. No matter how terrible the economy is, money will continue to flow. Those who are solving problems will continue to make money. People enter into a state of despair and they don’t offer any value and think that emotions and sentiments will attract money to them. But it doesn’t work that way.
How can financial growth be measured and sustained?
Everything begins with knowledge. If you know better, you will do better. Anyone that wants to change their lives should start learning. Begin with financial education. Know what you need to know and then begin to apply it. Now between the knowledge and application, something would have happened. You have become a different version of yourself because you must become rich to attract riches, you have to become wealthy to attract wealth. You also have to give it time because it is not a get-rich-quick thing. Once you realise you know what you need to know and have become who you want to become, don’t be distracted by lack of results or physical progress because anything that will grow will first and foremost be planted. Everything you are doing, you are planting your efforts. Signs take time but conviction must always be there. Just keep doing what you are doing, with time, it will show.
What is your message to Nigerians in view of the country’s situation?
Don’t give up. It looks so simple but when you see people committing or attempting suicide, it’s because of hopelessness because they cannot see light at the end of the tunnel. But there are many truths that life has made available to us that we don’t see. When there is life, there is hope. It takes a man to be alive to be tired. For you to be tired, you are alive. For you to be tired, you are not mad, you are able to analyse that the situations are challenging. Those are already assets. For you to be tired, you are able to compare your past and your present and able to visualise that your future may not look like what you expect, it implies there are a lot of faculties of success that are at work in you, because to succeed, you need imagination, confession and expectation. All these are intangibles that you already possess but you are using it in the wrong direction.
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