Kingsley Moghalu: On Transformative Leadership
Professor Kingsley Moghalu is the Founder and President of Strategies LLC, a global risk management and investment advisory firm that has advised multinationals, private equity, asset management and other emerging-market investors such as the Swiss bank UBS, Syngenta, Actis, Goldman Sachs to mention but a few. He is also the Founder and President of the Institute for Governance and Economic Transformation (IGET), a public policy think tank.
The former Deputy Governor of the Central Bank of Nigeria, supervised and led the execution of extensive reforms that stabilized a 17 trillion Naira Nigerian banking sector and improved its structure, inclusiveness, corporate governance, and risk management.
Moghalu, who was a candidate for the Office of the President of Nigeria in the country’s general elections in 2019, says he is back again as presidential aspirant for the 2023 elections, on the platform of African Democratic Congress ADC, with a transformative vision for Nigeria. In this interview, talks about his foray into politics, childhood memories, the Biafra war and his ultimate vision for Nigeria.
You have had a very successful and fulfilling career, why go into politics?
Because of the passion I feel for the rising poverty and the insecurity in this country, because of the vision I have for the country, and my belief that I have the capacity to execute that vision. Nigerian needs in 2023, a very different kind of leader from what we have had in recent years. That’s why it’s not ambition but vision. There are two different things. I entered politics, not because I wanted, or, I ever saw myself going into politics. I never did actually. So I was surprised at myself, but it was because I was angry at the situation in Nigeria, because I was fed up with being fed up. I have had a very successful life. So, I’m no longer interested in myself, but I am focused now on the situation in our country because, I have children, I grew up here as a child. This is a very different country today and it breaks my heart. Just look at what is happening in Kaduna. So many people were kidnapped because of terrorists, bombings and attacks on the rail and on the highway and just a few days before, at the airport. This country is under siege. And if we are not careful, within a short time, this country can be overrun by terrorists and we could become like Afghanistan.
How did we get to this level of insecurity andbwhatbin your view can or should be done to tackle it?
There must be political will that sees zero tolerance to the killing of Nigerians by terrorists, but we do not see that type of attitude. All we get today, is a book of lamentations being written after every attack. As president of Nigeria, you should be proactive. Take the battle to the bad guys. Do not allow them to strike first. Take the fight to them and take them out. That’s a very different kind of approach. Use technology, intelligence gathering and the political will, like I said, for me, the life of one Nigerian is too much to lose from terrorist attacks, let alone hundreds or thousands, which is what has become the norm in Nigeria over the past ten years and it is rising. We should also bring a very different approach in terms of reforms and the professionalization of the security architecture. It should be based on competence, not ethnic or religious affiliation, which again, is what we see today.
We should also tackle the allegations of corruption in the armed forces. There are allegations that the war on terror has become very profitable, for some people in the armed forces. These are allegations we must take very seriously. No country operates like this, because the truth is, it’s a failed State. That’s just the fact. We can pretend anyway we like, Nigeria has failed, but we have to build it back up again and 2023 is the year to do so.
With all that is going on in the economy and the rising exchange rate, what exactly would you say is the problem and if you have to advise the government, what would you tell them?
The problem is incompetence and maybe worse. Let me explain. The exchange rate of any currency is determined by how productive the economy is. That’s why it is important to lead the real diversification of the Nigerian economy towards the export of value added goods that earn forex.
If we manufacture and export value added products, right and then, we get an international trade forex back. The more you do that, the more forex comes into the country. The more your currency becomes competitive. That’s number one; number two is inflation. The very high rate of inflation is contributing to the very weak naira exchange rate. One of the reasons we have that inflation is because the Central Bank is irresponsibly printing money for the Federal government. This government is surviving on central overdrafts; 18 trillion Naira has been given to them in the past seven years. How can an institution that is supposed to manage inflation, paradoxically, be creating inflation? It is because it is not politically independent from the government.
The central bank today is not the central bank of when I was Deputy Governor. The Central Bank of today is an appendage of the Presidency. And for that reason, decisions are made not on the basis of economic, sound, macroeconomic management, but decisions are made for political purposes. The lack of independence of institutions in this country is now legendary.
Again, when the central bank created a fixed exchange rate for two years, between 2016 and 2017, the black market rate went through the roof. That was when the Naira collapsed, because we don’t want to practice the principles of market supply and demand. The cost of the Naira to the dollar is a market phenomena, you cannot legislate it. It is not about nationalistic, bombastic rhetoric. If the value of the Naira to the dollar is low, there’s nothing you say or do that will make it to be high because your economy is not producing what will support that ambition. So, the central bank can pump all the Nigerian foreign reserves into the market, if it likes it will not stop the slide of the Naira. The Naira is heading to one thousand naira to a dollar. That’s a fact! How many months ago was it 400 naira to the dollar? When I was Deputy Governor of the Central Bank, it was 150 and we kept it in that range for five years. So it’s about, like I said, incompetence. If you refuse to devalue the Naira, the Naira will devalue itself in the black market and that’s the real economy.
Now, if you devalue the Naira, you must devalue with strategy. Devaluation must be accompanied by industrial and trade policy, but this is not what is happening. That is where the problem lies because the economy is not producing and exporting what will bring in forex, at a level that matches the demand. It’s a market phenomenon.
But at some point the federal government stopped the importation of some goods, just so we can support our own brands. That was again wrong. You cannot put the cart before the horse. You create industrial policy that will bring up the production of those goods.
As they, as those goods are coming up in their numbers, inside the market, you
Use trade policy to create protection for those good; tariffs on imports, but that’s not the job of the central bank. That’s the job of the Ministry of Finance; tariff policy is not the CBN’s business. So the CBN said, we have a list of 40 items, which we will not give you Forex to import. It’s an artificial approach to the problem. What happens is that there will be smuggling, because you’re banning Forex for things that are not being locally produced in quantities enough to make the demand like milk, or rice, which is why there is a lot of smuggling in the country. So what you do is, you go and engineer the solution to the problem at the source, not using the Central Bank artificially, that just creates distortions in the market.
So, I’m all for made in Nigeria, but you cannot use Central Bank policy to legislate made in Nigeria when you are not dealing with industrial policy effectively, you are not dealing with trade policy. Innoson is manufacturing his own vehicles here, and it is not the Central Bank that made him manufacture those vehicles. It is his own ingenuity. That’s what we should encourage in this country and not use artificial policy formulations that just drive smuggling which is what is happening.
Petrol is the same thing. If you remove the subsidy on Petrol, half of the subsidy is a fraud in the first place. In 2022, the estimate is that they will pay three trillion Naira in subsidy. But what is the budget for education; maybe 50 billion. Do you see why this country is not developing? This country is going backwards, we are focusing on the wrong things. What you need is a proper transport system, if you invest in it, you remove the subsidy.
Ok away from politics now, tell us a bit about your childhood, and growing up years, what was life like for you? And what informed your choice of career as a teenager?
Oh, thank you. I was born in 1963, here in Lagos. When I was born, yeah; my father was in the Foreign Service. He was in the Ministry of Foreign Affairs. Three months after I was born, we left for Switzerland, Geneva, which was his first posting. We lived in Geneva for a year and then, my father was posted to Washington, then we moved to Washington DC. So my early childhood was spent abroad, but in 1967, he returned to Nigeria and joined the Eastern Region government as the political crisis was snowballing and many Igbos who were in the Federal Service were afraid and they left and returned to the East.
So, I went through the civil war, which was not an easy experience. We ate cockroaches, crickets, all sorts of things fried and many of them were very succulent.
So that part of life, Biafra; was a very difficult experience for many families. I saw war, I saw suffering. It made me hate suffering, and it made me hate conflict. All these were part of the reasons I went into diplomacy as a career later. After the war, I grew up mainly in Enugu and Aba. My father remained in the Civil Service, became a local administrator, and later, Deputy Permanent Secretary before he retired.
Then, I went to the University of Nigeria Nsuka, where I studied law. After that, I went to law school in Lagos, 1986, after law school, I did my National Youth Service, as a legal officer at Shell Petroleum at their headquarters at Marina Lagos. Later, I joined Newswatch where I was the General Counsel. So, I became a lawyer and a journalist for Newswatch. I was also a special correspondent for several international newspapers at the time. And, that was how I was earning some dollars. But my mind was always fixed on an international career. So, I knew that, that was a transitional phase for me. I wanted to leave the country immediately after youth service, but my father restrained me. At that time, as I was waiting to go to the US Embassy for an interview, a call came that Newswatch was looking for a legal officer, who could double as a writer and special assistant to the publisher. It was a mixture of many things and my father told me to take that opportunity because in those days, Newswatch was the place to be in the media. I spent three years there and it was a wonderful experience. And while I was there, I applied for my Masters at the Fletcher School of Law and Dewiplomacy at Tufts University in Massachusetts.
It is one of the schools you attend and you are piped into the international system immediately. That was how I was able to join the United Nations’ Foreign Service, in 1992. I spent 17 years in the UN from entry level to the highest career rank. I have a very successful career in the UN, but it was hard work, a lot of competition with the best from all over the world. And I was able to learn the management of diversity, which I believe is of great advantage for my political career.
As a teenager who had the most impact in your life?
Both my parents had very strong impacts in my life, but they were different in their impacts. Naturally, children are closer to their mothers at a certain stage of their lives, but ultimately my father had the strongest impact on me, because he was my role model and I am the first son. I was brought up to bear responsibility. I was brought up to know that you are responsible for your siblings and that you must be an example for them.
In those days, my father would beat his chest and say 35 years as a civil servant, I never took a bribe. That thing never left me, so everywhere I went, once I say I’m his son, the warm reception, the respect that follows, and you could see the legacy he left behind. I grew up determined to uphold and improve on the legacy of my father. That was why, when he died later, we set up a foundation in his memory, the Isaac Moghalu foundation.
What lessons would you say life has taught you as a person?
The lessons I have learned about life is to think beyond yourself, that, the greatest men and women are not those who focus on their own needs, but who focus on the needs of others. I am happiest when I have a transformative impact in people’s lives or in the lives of organizations where I have worked. I have also learned the importance of family, all work and no play makes Jack a dull boy. I take my immediate family very seriously. And so I try to spend time with my children. I didn’t want a life in which I was simply successful professionally, but a failure at home.
So, how do you balance it?
I balance it by making sure I create time to spend with my family, my wife and my children. I have four children three boys and a girl. I go on holidays with them. It was hard, but I had to learn it, and it taught me that work life balance is important. Greatness must begin with the immediate environment, your family; a man is the head of his own, and if your home is in pieces and you’re making noise outside, I’m sorry.
Let’s talk about fashion. What do you like to wear? What are you comfortable with?
First of all, I like to look good, no apologies. I am the drip Lord. I am versatile in fashion. I wear suits. I wear traditional dresses. I am a titled man; the Ifekaego of Nnewi Kingdom. So, I wear my beads, red cap and all my paraphernalia that goes with it. I like being simple as well. The older I get, the simpler I like to dress because I’m no longer dancing to impress anybody. I like elegance and in a responsible way. For example, in women, I prefer my wife and my daughter to be dressed, you know, in ways that are elegant, but responsible. I don’t like people who are close to me wearing clothes that are too revealing. For example, I don’t encourage it. So, you might say I’m a bit conservative in that sense.
What kind of music do you like?
I love music that is just melodious. I like PSquare, especially the track Oyinye. My wife’s name is Oyinye. There is a lot of beautiful music that comes out of Nigeria these days. I can’t even keep up with the young people. I like Flavor, Wizkid, and Davido too has some really good music.
Do you have time for exercise, how do you keep fit?
Yes. I like to walk. In Nigeria I try to use the gym. When I’m abroad, I walk.
Are you one for designers’ clothes or accessories?
I like elegant things. I don’t focus on names or brands. I wear things that are elegant. Because they are elegant, many people think they’re more expensive than they actually are. When it comes to those things, I’m actually quite cheap. So I look good for less cost.
What exactly is your vision for Nigeria?
My vision for Nigeria is that Nigeria should become a 21st century modern economy where its youth are well educated, have skills and have jobs, a country that moves from poverty into prosperity over the next 20 years, achieves what countries like Malaysia did, Singapore, the United Arab Emirates, those kinds of things. So I have a vision for Nigeria that is transformed by competent, visionary, capable leadership that I would love to provide for our country. I’m a transformative leader, I’m a visionary. I have a vision and I have a plan to achieve the vision.
My word to Nigerians is Nigeria can be great again and this is the year for us to make it happen. We should not lose hope. We should not agonize, rather, we should organize. Let us all get our PVCs and use it to reclaim our future, but let us understand that we have the power to do so, the responsibility and the power lie with us.