:00:14. > :00:16.Time now for HARDtalk. Welcome to the programme. The high
:00:17. > :00:20.price of oil is powering Nigeria's economy to new heights. This year,
:00:21. > :00:26.it's predicted to have grown by over 6%. So why do some experts say it's
:00:27. > :00:33.more vulnerable now than it was during the global economic meltdown
:00:34. > :00:37.of five years ago? If they are right, it has happened on Sanusi
:00:38. > :00:39.Lamido Sanusi's watch. The Governor of Nigeria's Central Bank, Sanusi
:00:40. > :00:42.Lamido Sanusi has accused politicians of flooding the country
:00:43. > :00:45.with dollars to lubricate election campaigning for a presidential poll
:00:46. > :00:48.that's still 18 months away. By then, Governor Sanusi's term of
:00:49. > :01:19.office at the bank will be over. Could he have his eye on a new one `
:01:20. > :01:24.in the presidential palace? Sanusi Lamido Sanusi, welcome to
:01:25. > :01:31.HARDtalk. Thank you. What you think is holding Nigeria's economy? The
:01:32. > :01:35.economy has been growing at. The growth rate is good. The big
:01:36. > :01:42.challenge is how to make the great inclusive and how to make it less
:01:43. > :01:52.vulnerable for shocks. A major problem is structural reform. We
:01:53. > :01:58.will education. The reforms would help with investment in
:01:59. > :02:03.infrastructure. When you are on this programme a couple of years ago, he
:02:04. > :02:09.complained about lack of support away from oil. Agricultural, 42% of
:02:10. > :02:16.the GDP. But only received 1% of bank lending. You said we have to
:02:17. > :02:22.criticise: the right industrial policy for the link `` for the bank
:02:23. > :02:27.to help the economy. There has been listening happening. A trade
:02:28. > :02:31.investment came out with a draft industrial revolution plan. With
:02:32. > :02:37.recognised the importance of secondary sectors. There is a new
:02:38. > :02:42.programme. It has addressed the issue of fraud in subsidies. We are
:02:43. > :02:45.trying to fix agriculture changes. The bank issue for Nigeria is we
:02:46. > :02:57.have to improve productivity for agriculture, from primary production
:02:58. > :03:04.to `` production. The GDP fell last year. Is that the fault of the
:03:05. > :03:08.politicians? No. Last year, there was a unique thing because of the
:03:09. > :03:16.floods. Our production this year has rebounded. It is not where we want
:03:17. > :03:22.to go still. Output is 2.3 tonnes per hectare. There is a lot that is
:03:23. > :03:27.to be done in terms of irrigation, fertilisers. Markets. Politicians
:03:28. > :03:32.think they have solutions to these problems. The first of the annual
:03:33. > :03:36.economic summit will be up at agriculture this year. There have
:03:37. > :03:41.been trumpeting some of the changes, for example, Chen `` plans to be
:03:42. > :03:47.self`sufficient in rice production by 2015. They want to impose a 100%
:03:48. > :03:51.tax on Polish rice imports. Is that the way to make major is economy
:03:52. > :03:57.competitive? I do not believe tariffs either way. Paris to address
:03:58. > :04:04.the problem. I have made it clear. `` tariffs. Tariffs will make rice
:04:05. > :04:10.smuggling a problem. The challenge with agriculture is dealing with
:04:11. > :04:13.productivity. It is about irrigation, seeds, fertilisers,
:04:14. > :04:21.trading, access to markets. It is also a bout corruption. A person
:04:22. > :04:27.from an American `based company, active in your country, state that
:04:28. > :04:31.at the summit, $10 million worth of agricultural equivalent was delayed
:04:32. > :04:36.into Nigeria because Customs and other agencies sought bribes.
:04:37. > :04:40.Another farmer in palm oil production said they had to provide
:04:41. > :04:45.their own electricity. Structurally, there is something wrong. There are
:04:46. > :04:51.structural problems. In the last year, the government has been saying
:04:52. > :04:56.the right things. Saying the right things? Are they doing the right
:04:57. > :05:00.things? With fertiliser subsidies, it has addressed the issue of
:05:01. > :05:08.corruption in subsidy regimes. They are focused on cocoa. They are
:05:09. > :05:12.focused on food crops. Some things have been fixed with local
:05:13. > :05:17.production. It takes a long time. For the first time in a long time,
:05:18. > :05:23.we recognise we have arrested plush `` productivity. Tariffs are not the
:05:24. > :05:31.solution. They will is important. Vast majorities of revenue comes
:05:32. > :05:35.from the taxes on oil. `` oil. Why do you think output is allowed to
:05:36. > :05:43.drop? There is a problem with the bill. It will invest `` attract
:05:44. > :05:48.investment in all sector. There is a problem with production because of
:05:49. > :05:52.the oil theft. There is a lack of transparency in the sector. Those
:05:53. > :05:57.issues have to be addressed. In someone said it was criminal accrued
:05:58. > :06:03.in a report. Nigeria is economy drives for competition for the
:06:04. > :06:08.resources. For government encourages violent opportunities around will it
:06:09. > :06:13.the doors for organised crime. It that's what it is not tackled more
:06:14. > :06:16.vigourously denied there are political questions. We are a
:06:17. > :06:22.resource rich economy. There is a struggle. We have to ask fundamental
:06:23. > :06:26.questions about the state itself and whether it is ready to change and
:06:27. > :06:32.address these issues. There are individuals who benefit from this.
:06:33. > :06:37.They want to resist change. Some of those are in powerful positions.
:06:38. > :06:42.Obviously, everywhere in the world, you have alliances between economic
:06:43. > :06:47.and political powers. Our tea break those up? It will take a lot of
:06:48. > :06:53.political will. How do you break them up? There is discourse going
:06:54. > :06:58.on. People are focused. You have been credited with Karen up some of
:06:59. > :07:06.those relationships in the banking sector. `` tearing up. Eight of the
:07:07. > :07:10.chief operating officers of some of Nigeria's commercial banks were no
:07:11. > :07:14.longer in their jobs. Have you seen off of your influence, your
:07:15. > :07:18.credibility as governor of the Central Bank, to put pressure on the
:07:19. > :07:25.politicians to do something about these problems? The only thing I can
:07:26. > :07:29.do is clean up my own area. Of course, I know that are a number of
:07:30. > :07:33.people in government who work on that. We can make more progress. I
:07:34. > :07:41.hope we will. It seems to be the reverse. Shell closed its trans`
:07:42. > :07:44.Nigeria pipeline September. Hundreds of thousands oil barrels per day in
:07:45. > :07:48.production because of leaks due to theft. That was that in a week after
:07:49. > :07:54.it was reopened. The whole structure around the industry, the lifeblood
:07:55. > :07:57.of Nigeria, seems to be undermined by exactly the forces that should be
:07:58. > :08:03.there to protect it. If you listen in the last few months, the
:08:04. > :08:08.President, the Finance Minister, the petroleum Minister, they say this is
:08:09. > :08:11.a big issue. It last two months, the beginning of an election campaign. I
:08:12. > :08:15.have the meetings with the head of security services. They talk about
:08:16. > :08:19.what they are doing on that. There will be progress. Frankly, it is
:08:20. > :08:26.something that needs to be done like yesterday. You are blamed for
:08:27. > :08:30.suspiciously high demand for dollars of currency exchanges earlier this
:08:31. > :08:33.year. He talked about the dollarisation of the economy by the
:08:34. > :08:38.political elite. What is your evidence that is what lies behind
:08:39. > :08:48.the surge in demand? I mention that is one issue. We discovered an of
:08:49. > :08:54.things that have brought. There was an increasing suspicion for dollars.
:08:55. > :09:04.In import of goods and services. In looking deeper, and then of course,
:09:05. > :09:07.going across... Joining the dots and if the reports, it was clear to me
:09:08. > :09:10.that some of that had gone into politics. Some of that goes into the
:09:11. > :09:20.importation of goods that have been banned. That a worried that a
:09:21. > :09:24.fundamental flaws in the economy and if the oil price were to drop,
:09:25. > :09:29.Nigeria might be in trouble. It is natural when the US Fed might think
:09:30. > :09:37.there is a slowdown in flows and pressure on the exchange`rate. Some
:09:38. > :09:44.of the pressure from the speculative... And... East. On the
:09:45. > :09:47.political side, you have any idea which party organisations or
:09:48. > :09:52.groupings, or supporters might be involved? We have an economy that is
:09:53. > :09:57.so highly what `` dollar rise. Everybody is in it. You have people
:09:58. > :10:02.asking for dollars four transactions. You people at moving
:10:03. > :10:10.dollars because it is easier to move huge amount of currency. Also,
:10:11. > :10:14.some might wonder what you have been doing for the last two years at the
:10:15. > :10:20.governor of the night `` Central Bank. A fair comment. Best late than
:10:21. > :10:24.never. You are in the last few months of your job. You had your
:10:25. > :10:27.successor will pursue this. We are talking about this earlier from the
:10:28. > :10:32.collection. It is more than a year away. You must be worried that kind
:10:33. > :10:39.of potentially could make his election not a very clean one. ``
:10:40. > :10:44.election. I can always talk about expensive or cheap. We have
:10:45. > :10:47.elections in 2011 which were some of the most expensive in the world.
:10:48. > :10:52.Election is everywhere are copping the pain. But you spent it on
:10:53. > :10:57.advertising. You spent it on my spammers and two for everybody. It
:10:58. > :11:04.spent on paying people to vote a particular way? I do not have any
:11:05. > :11:08.proof about that. `` T`shirts. It is difficult for Central Bank governors
:11:09. > :11:12.everywhere around the world. It is typical but is it difficult in
:11:13. > :11:18.Nigeria? I think it is. You have the pressure of the electorate wanting
:11:19. > :11:26.to see actual deliverables. You also have the expensive process. In
:11:27. > :11:31.Nigeria, 776 local governments have a chairman and counsellors who are
:11:32. > :11:35.elected. If 160 members of the House of representatives. Too many
:11:36. > :11:39.politicians. 36 governors. Too many. Basically, conducting
:11:40. > :11:44.elections across that it expensive. The logistics. To be fair, the
:11:45. > :11:51.Federal Government is reducing its budget for next year. Within that
:11:52. > :11:55.government running cost, that is going to go up by 10%. The Finance
:11:56. > :12:03.Minister reckons. That means that money on other things that are
:12:04. > :12:08.important, like infrastructure. Is that wise? I have made this comment.
:12:09. > :12:12.They are unpopular back home. I think the size of government is too
:12:13. > :12:17.big. We spend too much money on salaries and allowances. Why are
:12:18. > :12:22.they not listening to you? You are the governor of the Central Bank. In
:12:23. > :12:28.2010` 2011, the President is still listening. I do not know if he can
:12:29. > :12:33.change things that easily. He is the President. In 2011, we had an
:12:34. > :12:39.increase in wage. I knew it would increase the government. It is not
:12:40. > :12:48.discretionary. You are going to reduce how much to spend on... 10%
:12:49. > :12:57.increase? That is a lot. With oil production, as you want them about
:12:58. > :13:03.optimism? If we plug the loopholes, all of the gaps in the production
:13:04. > :13:10.stoppages, we should be able to do 2.4 million barrels per day. If. I
:13:11. > :13:14.think this one is Mr recognises that. It is still more conservative
:13:15. > :13:18.than the 2.5 million barrels used in last year 's budget. There is the
:13:19. > :13:25.option to read the rainyday fund again, the Axa 's crude count. It
:13:26. > :13:33.has been reduced from $9 billion to $5 billion. `` access crude account.
:13:34. > :13:37.If there is a shortfall, yet of which is a big problem. If we make
:13:38. > :13:42.assumptions that are too, we are having no savings. Are you worried
:13:43. > :13:47.they might do that again. The IMF said his goal offers in uncertain
:13:48. > :13:51.environment needs to be rebuilt. I'm sure the Finance Minister is
:13:52. > :13:56.worried. Again, what can we do? The things we need to address. We are
:13:57. > :14:03.paying too much on fuel subsidies. There is the question of salaries.
:14:04. > :14:07.It services. A lot of the spending is not discretionary until we can
:14:08. > :14:13.actually get rid of those are not going to create this pace that we
:14:14. > :14:16.want. `` debt services. Subsidies are an issue you have expressed as a
:14:17. > :14:24.force for sleep forcefully and publicly about. `` forcefully and
:14:25. > :14:29.publicly about. They do not scrap it. That was the original plan. You
:14:30. > :14:36.are pressing hard for that. Was that politics getting in a way of
:14:37. > :14:40.rational economics? There is a limit on how much the
:14:41. > :14:45.government can impose austerity on people, when they are out on the
:14:46. > :14:50.streets. It has taken a long time for anyone to even dared talk about
:14:51. > :14:54.reducing subsidies. It has been cut by 50%. Some of the companies that
:14:55. > :14:59.were being investigated for claims they were abusing their role in the
:15:00. > :15:03.subsidy process, the process by which fuel which has been exported
:15:04. > :15:07.for treatment has been reimported, and people are given financial help
:15:08. > :15:10.so they can afford to buy it, some of those companies were under
:15:11. > :15:14.investigation for fraud, and yet some of them are back employed by
:15:15. > :15:18.the government. It looks like they have backed down pretty quickly. The
:15:19. > :15:25.outcome for the population is not an improvement. The Finance Minister
:15:26. > :15:30.did authorise an investigation. The report was handed over to law
:15:31. > :15:35.enforcement agencies. Why did you lose the argument on getting rid of
:15:36. > :15:44.the subsidies? You were one of its most prominent public proponents. We
:15:45. > :15:51.have not lost the argument. One way or another, it has to go. It has to
:15:52. > :15:57.go. It is not sustainable. We have got a programme which reduces
:15:58. > :16:01.spending, but a lot of it... If you do not invest in capital, you will
:16:02. > :16:07.not have development. When should it go? Should it be part of the
:16:08. > :16:10.presidential election? It should be a number of issues. We have a
:16:11. > :16:15.situation where they are building a refinery. We need to reduce our
:16:16. > :16:21.dependence on imports. It will reduce the amount of subsidies. We
:16:22. > :16:27.need to help the investments that go into that thou, downstream it. And I
:16:28. > :16:30.think we should take action on those who have been involved in previous
:16:31. > :16:37.fraud. What kind of timeframe will be realistic to make the changes and
:16:38. > :16:39.bring the public with you? I think it is not on the table in the year
:16:40. > :16:46.before the elections. What would happen, this government or a new
:16:47. > :16:57.government... Posted 2015, how long do you hope it will take? As soon as
:16:58. > :17:00.a sub or. `` as possible. They have responded to the public protest. For
:17:01. > :17:04.many Nigerians who feel they do not get any benefit from the country's
:17:05. > :17:10.loyal world, that is one concrete benefit. Even at the decade of
:17:11. > :17:16.strong growth, the number of people living in poverty dropped by less
:17:17. > :17:20.than 4%. Down from just over 64%. In a sense, a lot of people are
:17:21. > :17:26.entitled to feel angry about their lot in modern Nigeria. Their roster
:17:27. > :17:33.shall issues. You have growth that is fuelled by agriculture and that
:17:34. > :17:41.is coming from... Not productivity. So until we improve productivity, it
:17:42. > :17:45.will lift up the population. Second, you see a weakness in technical
:17:46. > :17:51.education and investment. That is what you need to make your growth
:17:52. > :17:56.more inclusive. Otherwise you have the big headline figures that do not
:17:57. > :18:00.trickle down. How far do you think that economics rather than religion
:18:01. > :18:04.in the north, the aspiration for independence, are driving that kind
:18:05. > :18:09.of instability and insurgency that we see in Nigeria? I believe that a
:18:10. > :18:15.lot of the insurgencies are tied to economics. Whenever you have any
:18:16. > :18:19.horizontal inequalities, where they feel they are marginalised, which is
:18:20. > :18:26.happening in the Niger Delta, you create an environment in which
:18:27. > :18:30.people become radical. It could be ethnicity, it could be religion. At
:18:31. > :18:36.the end of the day, they are tied to poverty. You have been taking part
:18:37. > :18:40.in the world is lambing is `` economic Forum. Do you think the
:18:41. > :18:44.Western banking system have provided any part for providing the field for
:18:45. > :18:51.this extremely is on? I do not think so. It is one additional piece of
:18:52. > :18:56.furniture that helps diversify and deepen the financial system. David
:18:57. > :19:02.Cameron wants to make London the Centre for Islamic finance in
:19:03. > :19:06.Europe. To the extent that it can increase financial inclusion and it
:19:07. > :19:12.is to the less `` the real economy and based less on average, it is
:19:13. > :19:17.good for stability. Why are you handing out central bank funds to
:19:18. > :19:27.causes of your own? They are not mine. They are national causes. They
:19:28. > :19:32.donated to victims of a bomb blast. It is central bank policy. It is
:19:33. > :19:40.consistent. You have been giving money to universities. I have been
:19:41. > :19:43.investing, in building structures. It is something that we can do as
:19:44. > :19:48.part of corporate social responsibility. Let me put to you
:19:49. > :19:54.what one blogger had to say last year, at the time. He said, when the
:19:55. > :20:02.floods came in the south`west, displacing hundreds of people, and a
:20:03. > :20:06.long period of sustained fighting, the central bank kept its coffers
:20:07. > :20:13.closed. Does this not found the embers of scored? He does not know
:20:14. > :20:18.in 2002, the central bank did the same for the Lagos bomb blast. The
:20:19. > :20:23.intervention did not begin with me. They are central bank policy. One
:20:24. > :20:26.member of the house of representatives thinks not. He
:20:27. > :20:32.tabled a motion caught the misuse of Central funds. There is no legal
:20:33. > :20:37.provision. They have not been able to establish any wrongdoing. What
:20:38. > :20:42.people are wondering, whether you have a motive for doing this. That
:20:43. > :20:45.you are making these general `` generous donations of taxpayers
:20:46. > :20:49.money, you are not an elected politician, there is an election
:20:50. > :20:56.coming up, and they are thinking whether you are thinking of your own
:20:57. > :21:00.future? I do not need to spend money. I have brought down
:21:01. > :21:06.inflation, I have a stable exchange rate, I have a track record to go
:21:07. > :21:10.on. A consultant on transparency, he was quoted as saying, he is taking
:21:11. > :21:14.some politically motivated decisions that can harm the economy. He is
:21:15. > :21:18.disappointed with the way that he is going on giving government money to
:21:19. > :21:24.his friends. Who are these friends? The big and is of bombings, the
:21:25. > :21:31.universities? Are they friends. There are universities all over the
:21:32. > :21:35.country. Who are these friends? There is an election coming up. We
:21:36. > :21:40.talked about the presidential election. People think it is time
:21:41. > :21:44.for a new man in the job. The ruling party is split over Goodluck
:21:45. > :21:50.Jonathan's desire to run in 2015. Do you think it is the turn of a
:21:51. > :21:53.northern? I do not think elections should be based on where the
:21:54. > :21:57.president comes from. I think we have done that before and we have
:21:58. > :22:02.seen the cost of it. People should focus on what individuals have to
:22:03. > :22:07.deliver. There are some people, who think you have got quite a lot to
:22:08. > :22:11.deliver. Your term as central bank governor and stick some. You said
:22:12. > :22:15.you will not seek a central term. You are from the north which would
:22:16. > :22:18.be an attraction. It was reported that some influential figures in the
:22:19. > :22:23.north have put you at the top of their list of potential candidates.
:22:24. > :22:29.Has anyone approached you? People talk and people tell you that you
:22:30. > :22:35.should go into politics. I have never gone into anything for which I
:22:36. > :22:39.have no preparation. I was prepared to be governor of the central bank
:22:40. > :22:43.because I was based in economy `` economics. I do not know anything
:22:44. > :22:50.about politics. People will say what they want to say. Have you been
:22:51. > :22:54.approached? I have been spoken to. People have spoken to me and they
:22:55. > :23:00.continue talking to me. I have given the same ansa. I am not ready, I do
:23:01. > :23:05.not want it. You are not ready? In what sense are you not ready? You
:23:06. > :23:10.run the central bank of Nigeria. You claim credit for some big chant ``
:23:11. > :23:13.changes, the fall of inflation. Is that not what people want from their
:23:14. > :23:20.politicians, improvement in their daily lives? Doesn't `` being a good
:23:21. > :23:28.central bank governor does not make you a good politician. Is that what
:23:29. > :23:32.worries you? Yes, if I go into politics I would destroy everything
:23:33. > :23:36.that I have done. And there is no way that you could be persuaded to
:23:37. > :23:42.rethink that? No, I cannot survive one year in that space. That is an
:23:43. > :23:47.extraordinary conclusion to draw from modern Nigeria's political
:23:48. > :23:52.life. I think it takes a particular type of skill. I do not have those
:23:53. > :23:56.skills. Sanusi Lamido Sanusi, governor of the central bank of
:23:57. > :24:20.Nigeria, thank you for joining us on HARDtalk.
:24:21. > :24:27.It is a varied night of weather. There is rain in the south, frost in
:24:28. > :24:31.the north. We will keep the variety going over the week at head. It
:24:32. > :24:36.should be a fine day for many of us. But the rain clouds will return
:24:37. > :24:38.later in the week. It will be quite blustery. The rain is still
:24:39. > :24:41.lingering across the south`east first thing in the morning. Quite a
:24:42. > :24:43.breeze as well.