Sanusi Lamido Sanusi  (now Emir of Kano) was Governor of Central Bank of Nigeria. At the twilight of his tenure, he gave a talk themed ‘Overcoming the Fear of Vested Interest’ at the popular TedX summit. His submission has been transcribed by our correspondent, Theresa Igata, for your reading pleasure.

The full keynote:

In 1960, with a per capita income that was better/higher than that of South Korea, Nigeria was the preferred investment destination; preferred to Japan, according to the US investment advisory. Nigeria has always had potential but has never been able to realise that potential; a country that specialises in exporting what it does not produce and importing what it produces, one of the world’s largest producers of crude oil and yet does not refine its own petroleum products but imports its own petroleum product.

The world’s largest producer of cassava that does not produce starch or ethanol; a large tomato belt and yet the world’s largest importer of tomato paste. A country that from my childhood I have heard has the potentials of being a world power, but every day we talk about potentials and today we’re still talking about the potentials of Nigeria and yet, China, Malaysia, Indonesia, Japan, Korea, Vietnam and Brazil; all of these countries have turned the potentials that they have into reality. What is the one thing that we need to do to break this barrier that faces us?

In 4 years in Abuja I have come to the conclusion that we need to overcome the fear of vested interests. I’ll talk to you using my experiences as the governor of the Central Bank and use that as the basis or template of what we need to do to change this country.

I became the governor of the CBN in 2009, and this was in the middle of the global financial crisis. I came to the CBN knowing that banks had problems and believing that these problems were caused by a global crisis; by the collapse in the capital market and collapse in the price of oil and that they’ll be fixed by simply addressing the normal risk management issues in banks and shortly after we came in, I began investigations and I discovered that the Nigerian banking system was infested with the same corruption of the rental system in this country; that a number of bank chief executives have taken their banks and fleeced those banks and literarily taking away depositors’ monies to buy properties all over the world and just like people do in ministries or government agencies, whenever they have opportunities in oil companies, the banks were themselves a site for rent seeking.

The fundamental character of the Nigerian state is that for decades since we found oil, it has existed not to serve the people but as a site for rent extraction by a very small minority that controls political power and it doesn’t matter where this group comes from; whether the North, South, Christian, Muslim, military or civilian. The state has always been a site for extraction of rent with the exception of a few years we can think of when we’ve had development and this is at the heart of the problems of the country.

When we discovered this, there was one chief executive officer that took away from her bank over N200bn and this money was taken to purchase properties. We recovered from one CEO 200 pieces of real estate in Dubai, Johannesburg, Washington and apart from shares in over 100 companies and all of these were purchased with depositors’ funds.

We went to a court in the UK for the case against another CEO and we got a judgment against that CEO for N142bn stolen from the bank, taken to buy shares and manipulate the shares of its own institution and also taken outside to purchase properties.

The first CEO we were able to convict, we recovered these assets and got a six months sentence. For the second CEO, we finished our case, established that we had a criminal case in Nigeria and the UK; two weeks before the closing statements were made, the judge was miraculously promoted to the Court of Appeal; after three years of trial and coming at the very end of the trial because someone; a very popular religious leader with hundreds of thousands of supporters took the matter to political authorities and the system that was supposed to protect depositors and handle criminals was used and manipulated to promote a judge so that he will not convict a thief. This is an instance of the kinds of things that happen in a country and stops it from reaching its full potentials.

My fear of the banking reforms and how it affects the fear of investors are the following: After we discovered the things that happened in the banks, the critical thing we had to do was to take a decision that will pitch us against powerful political and economic forces. We were dealing with chief executives that in 2009 had become invincible; they were in the seat of power; they had economic power and they had bought political protection. They were into political parties and had financed the election of officers and they believed that nobody could touch them and every time I said it was time for us to take action; people say to me, you cannot touch these people, you’ll be sacked or they’ll kill you. But I said to them we’re going to take them on.

We took the decision to remove them; we removed them and nothing happened. We’re going to prosecute them and put them in jail and recover these assets, because the way the Central Bank operated in the past was that these guys take all these money and the Central Bank says the bank has failed.

The banks that we saved had N4.4tn in deposits, they had 8-10million customers but the government and the system has always betted on the side of the rich people because these customers will have the poor and the old. Think of a woman  who probably has been saving her money for the past 40 years -50 years and she wakes up one day and all her savings are gone. The civil servant who has worked for 35/40 years kept his pension money, the school fees of his children and the medical bills in the bank; wakes up one day and he finds that his bank is barricaded because the bank has failed.

Banks do not fail. When you say a bank has failed it’s like seeing a man whose throat has been slit and you say the man died; he did not die, he was killed. Those that destroy these deposits have always walked away; they become senators, governors, captains of industry. They set up new banks and they continue.

Nobody knows the number of Nigerians who have died from failed banks because they were sick and could no longer pay their medical bills because the money was locked up in a bank that has failed. Nobody knows the number of children who have had to drop out of school because the money to pay their fees was trapped in a failed bank or mismanaged.

I use this as on instance of what you can do if you’re ready to confront these vested interests and deal with them and protect the poor for the first time. But the banking industry is just one part of Nigeria. Take the oil industry as another case study, where we’re talking about fuel subsidy. In 2009, this country paid N291bn as subsidy for petroleum products by 2011 this number had jumped to N2.7tn. Did we start consuming 10 times as more petrol, had 10 times as many cars or did the population of Nigeria multiply 10 times? I did not believe those numbers.

I screamed against those numbers; we tried to remove subsidy and of course there was Occupy Nigeria. There had been investigations, and we discovered that a lot of that money never went to fuel subsidy that was consumed by Nigerians. There were people in this country that produced pieces of paper and brought to PPPRA and somebody stamped those papers and said they brought in petroleum products and actually paid them subsidy of some numbers of metric tons on some ships and we discovered that those ships were nowhere near the coasts of Nigeria on that date.

We’ve seen vessels that did not even exist that had been retired on bills of lading and money has been paid. And none of these people as I speak to you have gone to jail. This is the only country in the world where you have something called oil theft; where vessels can simply come and take crude oil and just drive out of the country.

How does anybody take oil in a vessel and leave the country where we’ve got the Navy, NIMASA, security services and the oil companies themselves and every day we complain about the lack of development because vested interests continue to rape this country and take the money out and the only way you’re going to move from potential to reality is to stop preaching and start asking yourself how we can overcome the fear of vested interest.

One thing I learnt from bank thieves is that they’re not to be feared; they stand on quick sand. They’re not very intelligent people because it doesn’t take much intelligence to steal; if they were smart then they probably won’t be stealing, they’ll find other things to do.

They have just two weapons and the first is, how much do you want and if you don’t want anything then they’re ready to destroy you. If you don’t want their money and if you’re not afraid of them, you’ll destroy them.

We have to ask ourselves as a country how we have allowed ourselves to be reduced to a level that is so far below our potential. I said to some youths at Tinubu’s colloquium and I asked them what it takes for one of them to become the president of this country where we have 67 million of them.

As a people why are we afraid to confront these issues; we’re afraid of losing the security that we have today; we may not lose it today but may lose it tomorrow. One message I have for every Nigerian is that the problems of this country are enormous, the solution is simple; that solution is that we must overcome and recognise that at the heart of the problem of Nigeria, there are people who profit from the poverty and underdevelopment of this country and these people are called vested interests and so long as they remain entrenched and so long as we’ve not overcome our fear of them and dislodge them we are not going to find a solution to the problem and we’re not going to reach our true potentials.