An economy lying prostrate
Each time I hear that Nigeria earns over 90 per cent of her revenue from crude oil, I baffle in utter amazement and question how this country would survive. The stark reality is everywhere that we’re in a desperate condition. Poverty is reeking in the population. Social infrastructure services are sub-optimum. One simple question I often ask to prove my point is how many people have public water supply running in their kitchen and bathroom?
How many people have six hours of electricity in a day? Under the existing framework, there is no way this country would be able to meet the myriads of challenges confronting her with oil revenue alone. This is the naked truth that must be accepted by the country’s leadership. And now that the oil economy has collapsed in the wake of the coronavirus (COVID-19) pandemic, Nigeria should brace for unprecedented economic turbulence.
This thinking is obvious from what is happening. Come to think of it. Why are we in this mess year in year out? Why can’t there be a glimmer of hope for Nigeria’s desperate souls and frayed nerves? Why are things getting worse every year despite all the promises made by successive administrations? Why are government’s promises not fulfilled? The answer to all this is in the disoriented and corrupt economic structure.
As a matter of fact, anyone in position authority, who relishes in acclaiming that the country earns over 90 per cent of her revenue from crude oil without being concerned with how to break the jinx is myopic. There must be talk of diversifying this economy and making it robust and productive before we can make any headway. The host of other mineral resources that are lying untapped must be exploited. Besides, agriculture must be revived. That is the only way this embarrassing situation could change for good.
Now talking a little more about the oil revenue, it is common knowledge that what is stolen is more than what gets to government. Some say that about 60 per cent of the oil and its revenue are stolen. Then out of the remaining 40 per cent, 60 per cent again is lost to corruption.
The erstwhile chairman of the Economic and Financial Crimes Commission (EFCC), Nuhu Ribadu, once calculated that over $380 billion has been lost to corruption in Nigeria since independence. He lamented that the amount is enough to replicate Europe with its development six times in Nigeria. The remaining 40 per cent is what is used in running the government at all levels.
Again, that remaining portion is siphoned by all manners of people in government. All the money meant for the provision of social services like roads, water, electricity, hospital, school, etc are virtually stolen. At the end of the day, what gets to the people from the total oil revenue is less than 10 per cent. It is only in Nigeria that you hear of revenue sharing as if the money is for the leaders. And indeed, those that share it pocket a large chunk of it. The left over fraction is what eventually gets to the people.
The Nigerian economy is not only lying prostrate, it is under intense pressure to perform. The Nigerian economy is like a civil servant who depends solely on monthly salary. The civil servant is even better in the sense that he knows what the salary is at the end of the month and could plan with it. The Nigerian economy depends on monthly revenue from crude oil that is unstable. As the price of oil fluctuates, the revenue earned fluctuates uncontrollably. The country and its economy can’t make any progress under such condition of uncertainty. The Nigerian economy is as unstable as the fluctuation in the oil market.
There is no civil servant out there who depends solely on salary that is finding life easy? Such a civil servant would not be able to meet basic needs not to talk of having extra for investment? But we know that most civil servants do private practice (PP) to meet up with demands. If a typical civil servant can’t make it with one source of income, how could the economy depend solely on unstable oil revenue and expect to meet the basic needs of the people and still have surplus for development? To be honest, we shouldn’t be talking of joining the league of G-20 developed economies with oil as our sole commodity.
Instead, we should be talking of going back to our roots that ensures economic sustainability, which was abandoned in 1975 at the wake of the oil boom. The root of this country’s economy is in agriculture. The oil diseconomy has been grossly mismanaged to the extent that it would be foolhardy to rely on it for the development of the country.
Let me state, unequivocally, that the era when Nigeria would have developed with oil money has passed in the 70s and 80s. We are now at a stage where too many greedy mouths are craving for the oil money. There should be alternative development strategy, otherwise, we should forget about national development.
Reviving the agricultural productive sector as in the 60s and 70s holds the key to the future. We should regain our position as net exporter of major agricultural products. That will make us to be self sufficient in food and thereby save the huge money expended on importation. There is no G-20 country that imports food. All the G-20 countries we look forward to joining are net exporters of food and industrial products.
America is the biggest economy in the world with the largest export of food and industrial products. Similarly, China, the second biggest economy is self sufficient in food production and a major exporter of industrial products. But Nigeria is nowhere in that league. We are nowhere to be reckoned with these countries.
We are arguably the world’s largest importer of food going by the size of our economy. Everything about our economy is in contrast with what obtains in the G-20 group of countries. We don’t belong there yet. The G-20 countries are not static waiting for Nigeria to meet them. By 2030, they would have moved further and widened the gap.
It is high time we cut our coat according to our cloth. We should reorder our priorities and do the right thing. First thing should come first. We can’t jump the gun. We must come back to the point where we derailed in 1975 before getting our bearing once again. Except this is done, I’m afraid there would be no magical transformation in a country that is highly corrupt.
While reflecting on this write-up, my mind went back to the early 70s when I was in primary school and we were taught Nigeria’s agricultural products like cocoa, rubber, timber, palm oil and kernel from the south, and groundnut pyramids in Kano, cotton, hides and skin, etc from the north.
We were taught about farm settlements established by Dr. Michael Okpara in different parts of the defunct Eastern Region. The question is where are those farm settlements? What happened to all the agricultural products that were produced and exported? What happened to the forest reserves, the rubber and palm plantations? How did Nigeria get stable power supply before the oil boom? Why are the various state governors not doing anything to revive agriculture? Some state governors are just wasting precious time and resources playing dirty politics.
With the exception of ex-Governor Bukola Saraki of Kwara State, who imported foreign farmers from Zimbabwe to revolutionise agriculture in his state, what are the other governors doing? Why is nobody thinking deep on how to get this economy out of the woods? This economy is simply on its knees and there is nothing anybody can do to an unwilling horse. The collapse of oil maybe the last straw that breaks the camel’s back. The time to change gear is now or never.
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