“The future will come and it will be different.” — Peter Drucker, 1909 -2005.

There will always be tomorrow. I learnt that fact from one of the most popular musicians in the 1960s.

Too young to understand its significance, I just enjoyed the music. Trainee programme, conducted by Polaroid Corporation, Cambridge, Massachusetts, USA, in 1970, for young employees, was the first exposure I had to forecasting future trends — especially economic and political.

The two were regarded as the Siamese twins determining mankind’s fate all the time. At the end of the one week course, each participant was required to make three predictions on any variable – for three months, six months and one year. On due dates, the course organiser would open our sealed forecasts; check them against actual occurrence and send out a circular to announce the results. Suddenly, attempting to unravel what might happen in the future was no longer a useless past time. My career depended on it. Since returning to Nigeria in 1974, I have been astonished by how little attention  Nigerian leaders in the public and private sectors pay to the matter.

“PMI report indicates slowdown in economic activities for 13 months -CBN.” — VANGUARD, August 15, 2024.

I sent a message to the VANGUARD Editor as soon as the vendor brought my morning papers telling him that the CBN deliberately omitted to disclose the obvious economic conclusion from that report. The Nigerian economy is in a recession; which is getting worse. For all of us, that is very bad news. The most important questions at this point are: how long will the recession last? How will it affect businesses? What will be required to reverse the trend?

In all my years working in the private sector of the Nigerian economy, I have experienced a few firms which operate without annual budgets at all. Even those which did hardly took into account economic trends and forecasts. There is very little doubt, in my mind, that the PMI report would have been glossed over by millions of Nigerian businessmen and women – as if it does not concern them. Yet, the survival of hundreds of thousands of businesses — large, medium, small and micro — depends on how quickly the downward trend can be halted and a recovery gets underway.

As usual, I have three true stories to tell regarding how vital having economic advice, as opposed to financial counseling, can be in a volatile economy. The three experiences taught me that having even a small peek into the future is infinitely better than sailing into a raging storm blind-folded as most Nigeria businessmen do now.

Slade Gorton, Frozen Fish Dealer, Boston, 1968-70

I finished undergraduate studies in June 1968; had got admission for MBA in Boston and took a full-time sales job. But, I was eager to partake in the American dream. I also took on two part-time jobs in order to raise the money to qualify for a mortgage for a house of my own. Architect (Col ) Tomi Asenuga, rtd, and Ayo Olagundoye, former Managing Director of defunct National Bank are my witnesses that by 1970, I had a house in Cambridge, half-way between Harvard University and MIT. Slade Gorton Fish made it happen. A sign posted in front of the building in Boston Harbour area asked for salesmen – full or part time. I applied. But, Mr. Gorton, later Senator, had other ideas for a graduate in Economics on his way to Business School for MBA. He attached me to his Economic Consultants providing advice on future trading. Because the company was buying and selling frozen seafood in 50 countries, he needed somebody to focus on exchange rate movements and how they would impact fish trade. The frozen seafood trade was highly competitive; but, I learnt very quickly how our forecasts gave the company a competitive advantage. I earned the money for my mortgage from selling fish and shrimps that had not even been caught!!!

North Brewery Ltd, Kano, and SAP — 1987

Lightening strikes more than once; if someone learns the proper lessons from history. When President Babangida opened the national debate on whether or not Nigeria should accept the loan offered by the International Monetary Fund, IMF, subject to also accepting the conditions attached, I was Corporate Planning Manager for North Brewery. It was my responsibility to guide the company’s diversification programme aimed at turning the brewery into a conglomerate based on NORBRU FARMS LIMITED which had acquired 10,000 hectares in Karu Local Government, near, Keffi. The success of the entire plan rested on the outcome of the national debate; but, particularly, the foreign exchange policy adopted by government. Once government adopted market determined exchange rate – in any form – we would have to start all over again with our financial estimates.

One thing however was clear to me. Whatever the outcome of the heated debates might be, devaluation was inevitable. So, I wrote an internal memo, restricted to the Managing Director, the General Manager and the AGM (Finance), advising the company, which was sitting on a large pool of cash, to engage in future trading — buy a lot of stuff before the announcement by the FG. I used cars as an example of what might happen to prices. Volkswagen Beetle and Peugeot 504 SR were selling for N6,000 and N15,000 respectively. My forecast was N25,000 for the Beetle and N48,000 for the Peugeot. I also warned that the company might not be able to buy new cars for a long time to come.

 The reply was prompt. The General Manager, scribbled in red ink across his own copy: “Dele, you must have been drinking too much Double Crown today. How can anybody sell VW for N25,000”? He copied it to other top and senior managers – who enjoyed the joke at my expense. I was undaunted. I applied for a staff loan, to which I was entitled, for N15,000 to buy the Peugeot from Danjuma Tsokwas Peugeot Dealer in Yola. The MD, a close friend, had the vehicle delivered to me in Kano, registered, GG4978YL, and fully insured. He went further. He sent an unlicenced Peugeot 505 SR just in case I wanted a bigger car – ten days before Babangida spoke about the Structural Adjustment Programme, SAP.

A week after IBB’s address, Volkswagen of Nigeria and Peugeot Automobile of Nigeria, PAN, posted new prices  — Beetle N26,000, Peugeot 504 SR N48,500. There was total silence when I entered the Senior Staff Bar and ordered two bottles of Double Crown and then announced: “Only those who drink too much Double Crown can think straight”. One by one, people sneaked into my office to ask the same question: “Dele how did you do it”? That was followed by “Congratulations, your new car (which I parked under cover on the premises) is now worth N48,500. How much will you accept for the 505? – which was delivered for N17,500. I would later sell the 504, after covering nearly one million kilometres, all over Nigeria and West Africa for N95,000.

More recently

In mid-2020, admitted for prostate cancer surgery, during COVID-19, I had all the time in the world to work on my forecasting models. Thinking I might die, everybody coming to visit me was advised to go and buy dollars and keep them.

A few did; most did not. The exchange rate was N350/US$ then; it is N1600/US$ now. Save your business. Find out what the exchange might be. End of story.

Follow me on Facebook @ J Israel Biola.