NIGERIA TODAY: THE PHASE AND FATE

I am elated as one of many young Nigerians, desperate for “True change”, to contribute my quota to nation’s building by making salient recommendations geared towards rescuing our great country from the lingering economic and political doldrums which have continuingly left us in limbo especially accentuate in recent times.

Great nations of the world never emerged fortuitously; they may have had phases of struggles, isolations, attempts at alternative styles of governance, domestic turmoil and stringent but deliberate decisions towards moving forward, among others. But in the face of all these, they remained resilient, positive and enthusiastic for true change, they upheld the virtues of nationalism and had several years of rooted R&D and ultimately thrived economically, socially and politically gaining various global labels such as “developed countries of the world”. Surely the process of building up requires a deliberate, importunate and all inclusive effort directed at achieving some properly designed/calculated sets of goals and targets. The case of Nigeria isn’t any different as the country as at now, is only passing through a “phase of transition” where if properly managed will bring about a major economic and political breakthrough for the nation. For Nigeria, I see light at the end of the tunnel.

The recent economic trend in the country is not a weird one, but the worry often times is the likely reaction of the market. The pressure on poor Nigerians especially the hike in prices, results from the over reaction of the market – a little shock in the economy leads to a more than proportionate reaction in the Nigerian market. Most often it seems as though the shock was frantically anticipated – the economy becomes unnecessarily over heated with inflated prices of virtually all consumables whether or not there is a direct impact from the shock, bringing on the economy vastly unfavourable “price spiral”. The recent hike in electricity tariff is a typical scenario. Desperate Nigerian traders, in a bid to exploit the situation, inflated the prices of items they sell – some of which already suffered the impact of the decline in the value of the naira per dollar. The cost of frozen foods for instance had a sudden upsurge, even the costs of items like “sachet water”, bread and the likes escalated unimaginably. 

Nigerians, directly or indirectly, are indeed hit by the recent depreciation in the value of the naira per dollar (over N300 per $1in the black market) whether as “producers” or consumers. From an economist’s view point, theoretically, producers (import dominant as in the case of Nigerian producers) with somewhat inelastic goods could simply shift the pressure on their cost of production to consumers of their goods to remain at par, ceteris paribus. In this case, only the consumers suffer and vice versa. However, Nigeria is largely a consuming economy, heavily dependent on importation with a marginal propensity to import (MPM) of about 0.70 against a paltry 0.30 marginal propensity to export (MPX) which of course is oil dominant. The implication of this statistics is that, either because there are no locally made substitutes or because Nigerians simply prefer foreign products, if an average Nigerian has a thousand naira, he will spend N700 on imported goods. If these figures are facts enough to go by, then it can invariably be inferred that the country is indeed suffering and perhaps will face even more difficult times than ever especially in the face of dwindling oil prices if no proactive measures are taken to reverse the current market trend.

The recent drift in the Nigerian economy was well predicted by experts both locally and internationally especially because the country is mono-cultural and largely import dependent. These predictions are already coming real. To salvage the economy from this seemingly quagmire situation, proactive measures must be taken. Below are few of such predictions.

Some Economic Predictions Materializing:              

One of the predictions of Prof. Charles Soludo in his article in January 2015, entitled “Buhari vs Jonathan: Beyond the Election”, was that “The Presidential election will be won by either Buhari or Jonathan. For either, it is likely to be a pyrrhic victory. None of them will be able to deliver on the fantastic promises being made on the economy, and if oil prices remain below $60, I see very difficult months ahead, with possible heady collisions with labour, civil society, and indeed the citizenry”. Despite various criticisms from different quarters, I still find this public debate very factual and worthy of the attention of Nigerians.

The International Monetary Fund (IMF) in December 2015, said crude oil prices may slump to as low as $20 per barrel in 2016. Following the release of the “IMF Executive Board Concludes 2015 Article IV Consultation with Iran” report, the body highlighted that the price of crude oil could drop between $5 and $15 in 2016.

Godwin Emefiele

Earlier this year the central bank boss, Godwin Emefiele, predicted that things were going to get tougher during the year with all indices pointing towards the reality of this bitter truth. He stated this during a press briefing at the bi-monthly Monetary Policy, MPC meeting in Abuja. According to him, “It is imperative to brace up for a longer period of low government revenues from oil sources, which would necessitate hard and uncomfortable choices as the economy transits to more sustainable sources of revenue, consistent with the economic realities and strategic objectives of the country. In the circumstance, certain tradeoffs must be envisaged and duly accommodated. (Curled from vanguard news online)

To many, this sounded rather too pessimistic for a country which recently bagged international recognition as the biggest economy in Africa after re-basing its GDP, being ahead of South Africa. (Albeit hilarious; Topic for some other times)

Charles Soludo

Soludo’s Comparison of Economic Management:
He wrote, “For comparisons, President Obasanjo met about $5 billion in foreign reserves, and the average monthly oil price for the 72 months he was in office was $38, and yet he left $43 billion in foreign reserves after paying $12 billion to write-off Nigeria’s external debt. In the last five years, the average monthly oil price has been over $100, and the quantity also higher but our foreign reserves have been declining and exchange rate depreciating. I note that when I assumed office as Governor of CBN, the stock of foreign reserves was $10 billion. The average monthly oil price during my 60 months in office was $59, but foreign reserve reached the all-time peak of $62 billion (and despite paying $12 billion for external debt, and losing over $15 billion during the unprecedented global financial and economic crisis) I left behind $45 billion.

Recall also that our exchange rate continuously appreciated during this period and was at N117 to the dollar before the global crisis and we deliberately allowed it to depreciate in order to preserve our reserves.  My calculation is that if the economy was better managed, our foreign reserves should have been between $102 –$118 billion and exchange rate around N112 before the fall in oil prices. As of now, the reserves should be around $90 billion and exchange rate no higher than N125 per dollar.

The big question then is; where did it all go wrong for the country? From Soludo’s argument, one can easily see that Nigeria has suffered a relapse. But again, the contention is; why has the economy become so tight following a relapse in oil price to about $30 whereas, the economy flourished when the oil price was only at about $38 during Obasanjo’s regime? Could it be some managerial flaws as insinuated by Charles Soludo? Too many questions, too few answers!!!

The finance minister, Kemi Adeosun has this to say:
 She says that the key difference between now and the 2008 financial crisis is that “we spent our way out of trouble” which Nigeria could afford at that time due to the presence of cash reserves. She mentions that Nigeria also increased borrowing by 3% of GDP in 2008. She criticized previous government actions by pointing out that “we did not spend on the things that build resilience in the economy…and that is why we find ourselves back where we really don’t want to be…that’s the truth”. Hmmmnn!!!

Against this backdrop, I must say that the fate of Nigeria lies in the hands of Nigerians. We have the capacity to make our country into an El Dorado where other nations of the world would wish for. #IHaveFaithInNigeria

My Recommendations:

1   .      Looking Inwards

This forms the major motivation for this article. “Looking inwards” is what Nigeria and Nigerians need. We must be patriotic enough to appreciate what we have and can produce within our borders. Nigeria is richly blessed by nature with a gamut of resources lying unharnessed (Table below). Every state in Nigeria, especially in the North, has one or more economic resources that can be harnessed and traded. There is no better time than now for the country to return to its lost agrarian culture where agriculture contributed significantly to GDP. Past Governments achieved very little trying to return to this lost glory, perhaps because of the distractions from the oil boom the country enjoyed in recent years. Unfortunately, we more or less use the oil money for personal consumption, which are goods not manufactured in Nigeria. This obviously is the reason why you don’t see much contribution from the oil sector to the GDP. Albeit, Nigeria is now the largest producer of cassava in the world – sounds like good news!!! I must give credit to the Buhari’s led government as this is indeed a step in the right direction.

What will be the fate of Nigeria without oil? There has been continuous decline in the oil sector’s contribution to Nigeria’s GDP. After the rebasing in April 2015, the sector’s share of the GDP stood at 17.52 per cent, 15.89 per cent and 14.40 per cent for 2011, 2012 and 2013, respectively. According to the National Bureau of Statistics, the oil and gas sector contributed about 10.45 per cent to the real GDP in the third quarter of 2015, lower than the 10.76 per cent contribution in the second quarter of 2014 and previous years. This incessant drop doesn’t seem to be transitory as it currently stands at about 8.9 percent. Little wonder why Prof. Pat Utomi who went ape at the economic situation had this to say “The economic situation is a very big issue and there are many problems that have converged. We are just paying for our sins. We are paying for not having done what we should have done. Who gets a windfall for a very long time? Oil is a very volatile commodity…we had a big boom but we squandered everything”. Against this backdrop, the GDP figure is still positive. This shows that Nigeria will remain Nigeria without oil. The country has a very robust economy and will thrive even when shocked with zero oil. Other productive sectors of the economy can perform even better if less and less attention is given to oil and gas and alchemized/diverted into other sectors. This topical economic misfortune provides enough signals for the country to look inwards and diversify. This may not come as easy as it sounds, but it is germane to the growth and prosperity of Nigeria.

Let us develop what we have: our foods, clothes, art, music, film, culture, among others and make them exportable. If we must stop the importation of goods which have substitutes within the country, then Nigerian producers must essentially imbibe the attitude of “quality”. We should be reminded to uphold the dignity of labour. Our producers must learn to package quality Nigerian products that are appealing to taste and trend- we must be proud of our brands. The need to innovate cannot be over flocked; Innovation is the "secret" behind China's decades of fast growth and will lead the way for its future development. It considers innovation in the formulation of its budget – that is the extent to which they regard innovation. Nigerians must be able to follow this lead by trying as much as possible to create or add value to what we produce.

In line with the Government’s restriction of certain importations, I would recommend to Nigeria a near – closure of the economy. We have the capacity to produce what we need – the essentials to life are food, shelter and clothing. If we can produce these sufficiently for Nigerians then we are on the track to economic freedom. Hunger breeds anger, and anger, violence – feed the hungry Nigerian, Cloth the naked and house the homeless and you would have saved the country from unending chaos. All these we can achieve without recourse to any external entity.  China for instance was ones an isolated communist nation who looked inwards and developed her “letters” to be able to produce what they needed especially challenged with a geometric population growth rate. China had to implement tight economic policies to ensure that it reached self-sufficiency. Today China’s economy is largely open. It doesn’t only produce for itself; it produces for many other countries of the world. For example, some American multinationals including Apple, AT&T, Merck, Coca Cola, P&G increasingly chase global growth by "outsourcing" production to China, and which, by building factories, transferring technology, and linking China to foreign markets, are further boosting Chinese productivity. China has the second biggest economy in the world and its biggest exporter, with an average GDP growth of 10 percent per year and expected to surpass the American economy by 2025. Nobody would believe that China has not only become the “World’s Factory,” but also sent their astronauts into space.  Since 1978, China has lifted more than 500 million people out of poverty, creating one of the largest economic miracles in the later 20th century. Nigeria essentially needs to learn from China’s example. #IBelieveInNigeria.

In the words of The CBN Boss as reported by vanguard news online, “Let us say, look, stop importing rice; stop importing toothpick; stop importing tomato from South Africa; stop importing 20 million eggs daily from Africa. “That’s the gist of what we are saying. We are saying Nigeria can do without these items. And the truth is that the reserves are no longer there.’’

Ben Bruce

We often say more than we can actually do. But here is one Nigerian who has “talked the talk and worked the work”. Ben Murray Bruce, one of the Senators representing Bayelsa in the Nigerian Senate and the “Common Sense” Crusader wrote: ‘As I promised, Dr. Innoson Chukwuma has delivered my Innoson cars which I will now use as my official car. I ordered two of his vehicles; An SUV and a Sedan. I paid for it with my personal funds, not government money. The cars are lovely. Go and get yours today. #BuyNaijaToGrowTheNaira. In one of his most powerful speeches, he challenged Innocent Chukwuma to produce for the future; cars that do not need gasoline to operate. We all must follow this cue if we must experience the kind of growth we hope to see.
#iStandwithBenBruce 

         

Kemi Adeosun

The minister of finance, Kemi Adeosun during the last ministerial screening said “We need to increase made in Nigeria; eat and drink made in Nigeria. The importance of this cannot be overemphasized. Fellow Nigerians we have what it takes to be better. #iStandwithKemi

Again, whilst looking inwards, noteworthy is the fact that the Nigerian economy has its peculiarities and may not be completely amenable to foreign theoretical constructs and models. Many of those models were developed to solve native economic situations of the countries where they were developed – perhaps, the reason it thrived. I call on renowned Nigerian Economists who in my opinion should be “doctors of the economy” to brainstorm and develop models that can solve our inimitable economic problems – models that can accommodate the likes of garri, fufu, amala, acha etc. until then would we hold the bull by its horn. We must be Nigerians indeed.   

  

2   .      The making of a New Nigerian

The making of a new Nigerian is similar to the socialist idea of “the making of a new man”. This ideology focuses on the “psyche” of Nigerians – the rebirth of a new Nigerian. This might not be totally successful with this generation of Nigerians whose minds have been debauched to see little or no good in the country. However, a persistent inculcation of the “positive side” of Nigeria and a continuous resonance of the “goods rather than “bads”” of the land through institutions of learning, religious institutions, and other social units of the society may go a long way in rebranding the minds of the citizenry. However, the price of patriotism is in the quality of governance. #Selah

Like my lecturer would say, “patriotism is a commodity that can be bought and sold”. Patriotism is a product of good leadership. How do I mean? Our parents and teachers tell us stories of how beautiful growing up was for them - How they went to school on scholarship, how they were served good food in school even up to the university, how they were offered good jobs from the government plus various kinds of allowances to follow and many more. Hey!!! With all these in place, why on earth would one not be patriotic??? Overtime, the story has completely changed. We are almost served the opposite of what our parents enjoyed. Where then would patriotism come from? Most Nigerians, especially young ones are yet to see the dividend of good governance and as such, have no reasons to be patriotic. Our leaders need to show us the substance of governance. If they say that we are future leaders, we say the future is NOW. 

The making of a New Nigerian would be more effective with younger minds that are yet to be exposed to the reality of the day, especially those at the primary level of education and perhaps the secondary level. Teachers must essentially inculcate and educate their pupils and students with the core values of patriotism. U.S. and Russia are typical examples of nations with these values. Children are made to believe that anything from their country is superior to that of any other country. With this mind set, young Americans and Russians grow to accept their local product as second to none in the world. The rebrand Nigeria campaign of late Prof. Dora Akunyili was a gallant attempt towards this direction, save that the campaign was more about giving the international community a new perspective/perception about Nigerians and Nigeria. #IBelieveInNigeria

3   .      Increase in the number of letters (Investment in Education)

The importance of building a vibrant workforce cannot be over emphasized. Human capital development is central to ensuring the prosperity of any nation. No nation can boast of development or an enhanced economy without a team of enlightened men and women who are tenacious and patriotic enough to repay their country for investing in them. One of the secrets of China’s success is in its rugged and dogged commitment towards developing its human capital. The Organisation for Economic Co-operation and Development’s (OECD) latest Programme for International Student Assessment results, a comparison of worldwide education standards, placed Chinese high-school students on top in every category. In China, family and state alike place huge emphasis on education, and schools and universities are teeming with bright, competitive, and exceptionally hard-working students. Two-thirds of the 8,000 PhD engineers who graduated from U.S. universities few years ago were foreigners (mostly Chinese and Indian). The higher the number of letters a country has, the higher the propensity to grow and vice versa. The government of Nigeria must therefore increase its commitment to the development of education in the country. 

4   .      Holistic anti-graft war

The economic and socio - political implications of corruption are grave and detrimental to a nation’s prosperity. The impact of the multiplier effect permeates through all sectors of the economy. The anti-graft war of His Excellency President Muhammadu Buhari is a bold step towards restoring the dignity and pride of Nigeria. Corruption is a complex word used to cover a wide range of morally offensive or criminal acts; these practices retard developing economies. Even if corruption takes a more financial outlook, it is not strictly the case. For example, the reward of the public official may be non – monetary, but these would not make the act less corrupt. Corruption wears a popular face and is recognized by most people when they see it. (For an x-ray on the economic implications of corruption, look up Economics: An African perspective by Prof. Joe Umoh - 17:257). For there to be significant success in the fight against corrupt practices in Nigeria, then the fight must be holistic – free from influences from political parties, personalities, figures, religion, and other possible interferences. There must be a totally new approach to employments, admissions, contracts, and related processes. We must have in mind, the fact that nothing is completely self – regarding. Until then, the fight against corruption would only be futile. 

5.      Practice True Politics

Until now, we as a nation are yet to practice true politics. In my opinion, the politics of Nigeria is still amateur and highly characterized by prejudice. It has become a matter of only those with the balls to go any mile in order to get what they want. Elections in the country are yet to be free from bloodshed and horror – several months after the 2015 elections, lives are still being lost from electoral disputes. In my opinion, 2011 elections was one of Nigeria’s finest and was a good foundation for subsequent elections in the country. For a nation striving to breakthrough as one of top twenty developed countries of the world in less than a decade to come, these odds must be a thing of the past. True democracy is so far a mirage, and is what the country needs. We need a disciplined and focused political leadership especially at this time – Prof. Pat Utomi (paraphrased). 

 Nigeria must come to a point where elections are decided by the quality of “issues” or promises canvassed by the candidates rather than on prejudice. We must tune our minds into playing politics of “candidature” rather than politics of “political party”. Yes, candidates must belong to a political party to contest elections, and political parties have their various manifestos for the country. Yet, we must be driven more by the “qualities” of the candidate plus the substance of the partys’ manifesto and not by the “nomenclature” of the political party or by our religious/social affiliations with the player in question.

Conclusion:

Let me conclude with the words of Senator Ben Bruce “Nigeria is too poor for our leaders to act as multi-billionaires and Nigeria is too rich for our people to be too poor”, “The world has changed, but we have not changed”.

It’s a clarion call on all well-meaning Nigerians to shun all forms of distractions capable of frustrating the kind of change we look forward to, and unite as a formidable nation where peace and justice shall reign; Let us in our various capacities irrespective of religious, ethnic and political differences join hands to build a better Nigeria, rather than continuously antagonize the government of the day, watching keenly to see it gaffe. The success of our leadership is our collective success and vice versa. We must not all become Presidents, Governors, Senators, Ministers or other high ranking Executives of Government to contribute our quota towards the building of a greater Nigeria. Let’s think Nigeria, Eat and drink and wear made in Nigeria and be the change we want to see in our nation. Arise o’ compatriots to the dawning realities of time – the labour of our heroes past shall never be in vein. The future is here, the future is NOW. So help us God!

#ItsAllAboutNigeria

Table:

S/N	STATES	MINERAL RESOURCES
1	Abuja	Marble, Clay, Tantalite, Cassiterite, Gold (Partially Investigated), Lead/Zinc (Traces), Dolomite
2	Abia	Gold, Salt, Limestone, Lead/Zinc, Crude Oil
3	Adamawa	Kaolin, Bentonite, Gypsum, Magnesite
4	Akwa Ibom	Crude oil, Lead/Zinc, Clay, Limestone, Uranium (traced), Salt, Lignite (traced)
5	Anambra	Lead/Zinc,Clay,Limestone,Iron-Ore, Lignite (Partially Investigated),Salt, Glass-Sand, Phosphate, Gypsum, Crude Oil
6	Bayelsa:	Clay, Limestone, Gypsum (Partially Investigated), Uranium (Partially Investigated), Manganese, Lignite, Lead/Zinc (Traces)
7	Bauchi:	Amethyst (Violet), Gypsum, Lead/Zinc (Traces),Uranium (Partially Investigated)
8	Benue:	Lead/Zinc, Limestone, Iron-Ore, Coal, Clay, Marble, Salt, Berytes (Traces), Gem Stones, Gypsum
9	Borno:	Diatomite, Clay, Limestone, Hydro-Carbon (Oil And Gas), Coal (Partially Investigated), Gypsum, Kaolin, Bentonite
10	Cross river	limestone, uranium, manganese, lignite, Lead/Zinc, Salt, Crude oil
11	Delta	Marble, Glass- Sand, Gypsium, Lignite, Iron-ore, Kaolin
12	Ebonyi	Lead, Gold Shocked, Salt
13	Edo	Marble, Lignite, Clay, Limestone, Iron-Ore, Gypsum, Glass-Sand, Gold, Dolomite Phosphate, Bitumen, Crude Oil
14	Ekiti:	Kaolin, Feldspar, Tatium, Granite, Syenite
15	Enugu	Coal, Limestone, Lead/Zinc
16	Gombe:	Gemstone, Gypsum
17	Imo	Lead/Zinc, Limestone, Lignite, Phosphate, Marcasite, Gypsum, Salt, Crude Oil
18	Jigawa:	Butytes
19	Kaduna:	Sapphire, Kaoline, Gold, Clay, Surpentinite, Asbestos, Amethyst, Kyanite, Graphite (Partially Investigated), Silhnite, Mica (Traces), Aqua Marine, Ruby, Rock Crystal, Topaz, Flosper, Tourmaline, Gemstone, Tantalite
20	Kano:	Prrochinre, Cassiterite, Copper, Glass-Sand, Gemstone, Lead/Zinc, Tantalite
21	Katsina	Kaolin, Marble, Salt
22	Kebbi	Gold
23	Kogi	Iron Ore, Kaolin, Gypsum, Feldspar, Gold, Marble, Dolomite, Talc, Tantalite
24	Kwara	Gold, Marble, Iron Ore, Cassiterite, Colubite, Tantalite, Feldspar (Traces), Mica (Traces)
25	Lagos	Glass –Sand, Clay, Bitumen
26	Nasarawa	Beryl (Emerald), Asquamirine And Heliodor, Dolomite/Marble, Sapphire, Tourmaline, Quartz – Amethyst (Topaz, Gamet), Zireon, Tantalite, Cassiterite, Columbite, Limonite, Galena, Iron Ore, Barites, Feldspar, Limestone, Mica, Cooking Coal, Talc, Clay, Salt, Chalcopyrite
27	Niger	Gold, Talc, Lead/Zinc
28	Ogun	Phosphate, Clay, Feldspar (Traces), Kaolin, Limestone, Gemstone, Bitumen
29	Ondo	Bitumen, Kaolin, Gemstone, Gypsum, Feldspar, Granite, Clay, Glass – Sand, Dimension Stones, Limestone, Coal, Crude Oil
30	Osun	Gold, Talc, Tourmaline, Columbite, Granite
31	Oyo	Kaolin, Marble, Clay, Sillimnote, Talc, Gold, Cassiterite, Aqua Marine, Dolomite, Gemstone, Tantalite
32	Plateau	Emerald, Tin, Marble, Granite, Tantalite/Columbite, Lead/Zinc, Barites, Iron Ore, Kaolin, Belonite, Cassiterite, Phrochlore, Clay, Coal, Wolfam, Salt, Bismuth, Fluoride, Molybdenite, Gemstone, Bauxite
33	Rivers	Glass – Sand, Clay, Marble, Lignite (Traces), Crude Oil
34	Sokoto	Kaolin, Gold, Limestone, Phosphate, Gypsum, Silica-Sand, Clay, Laterrite, Potash, Flakes, Granite, Gold, Salt
35	Taraba	Kaolin, Lead/Zinc
36	Yobe	Tintomite, Soda Ash (Partially Investigated)
37	Zamfara	Coal, Cotton, Gold

SOURCE: NaijaQuest - Verifiable              

                                                    

Emmanuel, Daniel Archibong
Graduate of Economics, University of Uyo
Email: daneyarch@yahoo.com
Phone: +2348164147890
@daneyarch   
April 2016