Nigeria at 52: Poor People, Rich Nation

Nigeria oil platform. Business Day reported that production during Feburary 2010 was the largest in Africa. During 2009 Angola outstripped Nigeria for overall production from the continent., a photo by Pan-African News Wire File Photos on Flickr.

Nigeria at 52: Poor people, rich nation .

Wednesday, 03 October 2012 00:00
BUKKY OLAJIDE Business Services
Money Watch
Nigerian Guardian

With poor management of resources, accentuated by business-unfriendly fiscal and money policies; parlous infrastructure; and poor governance, Nigerian rank among the poorest people in the World today, despite huge earnings the government has been realising from crude oil. Some analysts who spoke with BUKKY OLAJIDE said that celebrating the country at 52 is like celebrating unachievement.

THE forefathers of the Nigerian system laid a foundation for a production based economy. In fact, Nigeria as a country thrived more before the discovery of oil as each region concentrated on the agricultural produce, which brought to the nation, economic respectability on a global scale.

For instance, the West produced cocoa both for local consumption and for export purpose. The East produced palm oil as well while the North produced groundnut and cotton, among others.

However, all theae gains got eroded especially in 1986 when Structural Adjustment Programme (SAP) was introduced.

The discovery of oil gave the country a negative turn around as agriculture was abandoned and all eyes concentrated on oil. The discovery of oil did not lead to the development of the country, in concrete and sustainable terms.

The citizens only hear of the figures of the huge earnings with no concommitant development on ground to justify the windfalls.

The successive ruling class has always failed the country. Nigeria as a country remains poor as good governance eluded the country.

Good governance involving institutions with serious control over corruption as a necessary requirement for development was lacking.

No matter how much endowed a country is, it will remain among the poorest of the world if the managers of the country’s economy do not manage the resources well, whereas a country with less or non existing resources can prosper more with good governance in place.

Instead of using oil earnings to create wealth and diversify the economy, the ruling rather seized this as an opportunity to enrich themselves. They used the national treasury to purchase assets all over the world. Therefore, the rest of the citizens are being stripped virtually naked by the elements who are using political power as instruments to compromise the future of the country.

They would have appropriated money meant for development, and then take a decision to borrow from foreign countries. The debts do not only become a major source of private illegal accumulation, the involvement in foreign debt was a great albatross as servicing and repayment took a great toll on the economy and impoverished the people the more. The present poverty stricken citizenry arose out of these irresponsible borrowings.

Every aspect of the economy is in bad shape. Manufacturing business in the country is gradually closing up as the country operates an un-enviable business environment, characterised by poor infrastructure, misallocation of resources, multiplicity of taxation and so on.

Nigeria as a country has no welfare system for its citizens in this modern century in a situation where welfarism started in a country like Germany in 1883 and maintained till now.

One of the consequences of the successive mis-governance is the issue of unemployment that the country is facing today. A country endowed with abundant resources in both human and material resources but which resources were not optimally utilised due to gross mismanagement will definitely lead to unemployment and poverty.

The bad economy is like a vicious circle: Low per capita income curtails and reduces consumption capacity, reduce propensity to produce and ultimately result in sub optimisation of the available factors of production.

Eze Onyekpere, a lawyer as well as financial analyst is the Lead Director, Centre for Social Justice, said even though nations do not exactly grow, mature and wither away within the time frame of a human life, a period of 52 years is a good time frame to review the progress made, challenges on the road and the projections for growth in the years ahead. As always, today’s Independence celebration offers us another opportunity for a sober reflection to identify what we have done right for the purpose of replication; what we have done wrong so that we can avoid repeating such wrongs and our unique opportunities which can be harnessed to fast-track the development and growth of the nation in the years to come.

While complaining about Nigeria’s underachievement, he recalled a senior colleague who once pointed out that in the 1950’s and 60’s, there were very few schools, hospitals, airports, highways, cars and that most of the buildings in the countryside were made of mud and thatch.

For him, a lot of progress has been made and all these things have changed for the better. Indeed, things have got better and are heading for more drastic improvement..

His words: ‘’Are the foregoing really the indicators of the progress of nations? It will amount to celebrating underachievement if we are to roll out the drums, as we are wont to do, in the excitement of counting the number of years we have existed as a nation.

“A number of issues come to the fore. Are we developing at the pace of our peers – Singapore, Brazil, South Korea? The answer is obvious. No. Are there concrete plans by the elite and leadership to lift Nigeria out of the pit? Apparently, there is none. We are a people content with offering apologies for things that do not require apology but developmental actions based on strategic thinking.

“As a young man, I grew up to hear apologies that our underdevelopment could be traced to slave trade and colonialism. Admittedly, these historical facts left indelible marks on our developmental strides. But, we were not the only ones who were enslaved or colonized.

“The military were in power then and as such, they were not officially added to the list of the apologies. Military rule was later added to the list after the soldiers had left. Thirteen years of civil rule have changed nothing. What is the apology this time? Yes, I know that a culture that was institutionalized in about 28 years of military rule cannot be changed overnight. But 13 years is enough time to begin the steps to correct the anomalies of military rule. Is it about those who have led us since 1999 – Olusegun Obasanjo, Musa Yar’Adua or Goodluck Jonathan?

“It is the position of this discourse that a review of the challenges facing our nation will reveal that the fundamental challenge of development and nationhood is that the country is in denial of its basic nature and challenges. The leadership has not come up with a concept of development that is sold to the populace as a national vision for resolving our myriad of problems.

“We are still faced with the challenge of integration and defining the identity and benefits of citizenship. Our leadership question is not about how to bring out the best to lead or a contest of ideas, it is about the ethnic and religious origin of a proposed leader. Is he from the North, East, West or any of the new six geopolitical zones? This is not the path to nationhood, neither is it the path to development.

The other day, the Petroleum Industry Bill was presented to the National Assembly. The next thing in the media was that the Northern Governors’ Forum had set up a committee to review how it will affect the North. May be, there are other groups who have not come out publicly to state their own views.

The International Oil Companies have a common position on the bill based on the profit motive. Present beneficiaries of the decadent system in the oil industry will be taking steps to frustrate the reforms proposed in the bill. But who is speaking or who is researching on behalf of Nigeria? Is there really a Nigeria where a majority of its citizens devoid of where they come from are committed to the vision of its progress, honour and glory?

“That vision of Nigeria does not currently exist in the minds of the leadership and indeed in the minds of majority of Nigerians. The voting pattern at major federal elections bears this out.

“Sadly, we are in denial of our differences in religion, ethnicity, culture, and history. We believe we can suppress these differences and move on with our lives without having thorough discussions on how to manage them.

“Continuing this denial accounts for national policies that are not in the overall interest of the nation but skewed to favour one group or the other, poor quality leadership at the federal level, the indigene/settler dichotomy and the attendant loss of lives and properties it engenders, religious extremism of all forms, among others.

It may be fashionable to paper over these cracks and pretend they do not exist. But that is the tradition of the ostrich.

Jide Ojo, a public affairs analyst based in Abuja felt that despite divided opinions, there is a near unanimity of view that the country is not where it should be in terms of national development.

Yes indeed, we have made progress but not an appreciable one considering where contemporary third world nations like Brazil, South Africa, India, Malaysia and Singapore are, he said.

While saying that Nigeria is lucky to remain united in spite of many centrifugal forces pulling it apart, Ojo observed that Nigeria since independence has launched many development plans and articulated a number of visions such as Vision 2000, 2010 and now 2020.

Unfortunately, he said, the country hasn’t got much to show in terms of real development as there is still a lot of infrastructural deficit while unemployment is at its peak, education is in the doldrums while corruption thrives, therefore dwarfing all government effort at nation-building.

In the financial sector, he said further, particularly the banking sub-sector the crises in that axis which exploded in 2008 are yet to be over. If another stress test is conducted on the existing banks some of them are likely to go under as the harsh economic environment has not been helpful to our banking industry.

Just few days back AMCON and CBN have to release a list of bank debtors who should not be given any further loan, if bank customers are not paying back their debts how will the banking system survive? Yet it is not altogether the fault of the customers, many of them are being owed billions by various governments, federal and states especially.

Many government contractors are not paid years after completion of their awarded contracts. Bank interest rates is also very unfriendly as it is usually in two digits, this in itself has made bank loans a debt-trap.

There are also too many reforms being pursued by the regulators of the banking industry at the same time, CBN, AMCON and NDIC kept churning out reforms that are in most cases ill-digested. The case in point is the attempt by CBN to restructure the country’s currencies and introduce additional denominations of coins as well as N5, 000 notes. This in my opinion is antithetical to the cashless policy introduced last year. Thank God the policy has been suspended. Even the cashless policy of CBN has not been fully embraced in Lagos where it is being piloted. It is also noteworthy that Nigeria is gradually sliding into debt-trap it exited few years ago.

On the whole, much as one can say we have made some progress in the area of economy in the last 52 years, corruption, insecurity, and bad management have combined to rob majority of Nigerians of high standard of living, rather we have been inflicted with high cost of living with greater poverty, unemployment and inflation to show for it.