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We must diversify to exit recession

By Bayo Ogunmupe
29 January 2021   |   4:31 am
By Nigeria must change her relationship with prosperity. Wealth is everywhere you look: Japan that knows neither Jesus nor Mohammed; as well as South Korea, is in everlasting riches though she only knows the Buddha.

By Nigeria must change her relationship with prosperity. Wealth is everywhere you look: Japan that knows neither Jesus nor Mohammed; as well as South Korea, is in everlasting riches though she only knows the Buddha. China and Russia that know no God have conquered poverty. Transactions happen all the time. With our hypocrisy, we’re just on the wrong side of those transactions; always consuming, never producing. We don’t need a huge slice of the pie. We only need a tiny fraction of the seven billion people on earth to buy something we produce or manufacture. Let us do the mathematics: N100k a year gives N12 million when you have a business that sells products 24 hours a day. Sadly, we even import tooth picks produced from our wood and petrol mined from our soil. We are not planning for prosperity, never internalizing the Biblical aphorism that God blesses the work of your hands and not your person. We need only five years to build an industry that will liberate us from neocolonialism.
Only last December, the World Bank rated Nigeria the 26th largest economy in the world and 24th for Purchasing Power Parity (PPP). However, these two measures represent different aspects of the economy. While GDP is the measure of the market value of goods and services produced in a country in a year, the PPP reflects the purchasing power of Nigerians in Naira and the standard of living of the people. As at December 2020, the World Bank also estimates that 46 percent or 91 million Nigerians are poor while another 19 million are vulnerable to multi- dimensional poverty. This picture does diminish whatever cheer inspired by the World Bank ranking. In reference, multi-dimensional poverty means a state of abject poverty and deprivation beyond financial insolvency. With the bulk of Nigerians so trapped in debilitating poverty, it isn’t surprising Nigeria is in turmoil with resurgent kidnapping, banditry and Boko Haram insurgency. Thus, this escalating insecurity is traceable to the poor state of the economy.

In the circumstances, it is significant that the same World Bank that ranked us high in GDP has warned the Nigerian federal government to urgently embark on boosting productivity across the country with particular emphasis on reducing the large army of the unemployed. We recall, in the aftermath of the depressed and the deplorable state of our economy ignited the destructive wave of street rage called the EndSARS protests nationwide. Consequently, the federal government ordered the states and federal capital territory to constitute judicial panels of inquiry on the protests. The President also promised relief packages for them to be delivered by the 2021 federal budget.
Subsequently, gory tales are being exposed through testimonies at tribunals investigating the atrocities of the Special Anti Robbery Squad (SARS) of the Nigeria Police Force. With Nigeria reverting to recession from the fourth quarter of 2020, salvation can only come through diversifying the economy. It is unfortunate that despite abundant resources in oil, arable land and solid minerals, Nigerians still find it difficult to feed themselves. Thus, our economy faces two major problems; one, the chronic lack of investment expertise among our political leaders. That results to the saying, “our problem isn’t money but how to spend it.” Our second problem is a direct lesson from the Italian philosopher, Niccolo Machiavelli, when he said in his book The Prince, “there is nothing more difficult to implement than reform.” Reform attacks privilege, of which we have many patrons in Nigeria: overstaffing, pampered legislators and public officers.
Moreover, instead of allocating oil blogs, solid mineral plots to states, the president allots them to his cronies. This unbalances the polity, it makes individuals richer than states and local governments. Which is why individuals are rich enough to destabilize the state through banditry, insurgency and Boko Haram. Here is my reform agenda: Let the Central Bank Of Nigeria create instruments for agriculture lending, small and medium enterprises lending and the import substitution industry protocols. The banks in the country will now create desks for lending of these items. The federal government can now scrap those avenues for corruption as agriculture bank, bank of industry, development bank and the Small and Medium Enterprises Development Agency of Nigeria. Those institutions are just wasting our resources; they have neither led to our prosperity nor development.
Our effort on diversification is hampered by our lack of electricity. Without which we can never industrialize. Thus, let us diversify into renewable energy, such as solar power, and wind energy. Let us invite companies from abroad to do it for us. Recently, India ventured into renewable energy. She is now a world leader in energy engineering, computer engineering, and medicaments. We live in the belt of nearly 99 percent solar radiation. We can use solar power for security lighting and reduce the load on power distribution and free power capacity for industrial consumers. In Malaysia, they use rubber wood to make export grade furniture. Also we should learn from the Chinese how they use ordinary sand, and limestone to build durable houses. You can imagine the quantum of job opportunities these will open up in Nigeria should we decide to diversify the Nigerian economy.

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