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Communique of The Podium-5 October

Communiqué Issued at the End of the Big Ideas Podium on the Theme: “Ending Poverty in Nigeria: Using what we have to get what we want”, held on 5th  October, 2017, at the African Heritage Institution (AfriHeritage), 54 Nza Street, Independence Layout, Enugu

Introduction

 

The Big Ideas Podium is a national platform for public policy debates on burning and salient issues that affect or shape development or governance in Nigeria, West Africa, and the African continent. It encourages the deployment of both intellectual and empirical insights as it scrutinizes societal and national problems with a view to developing shared understandings of, and proffering recommendations for policies or solutions to social, economic, governance and political challenges facing Nigeria and the African continent.

 

The October 5, 2017 edition of the Big Ideas Podium was anchored on the theme: “Ending Poverty in Nigeria: Using what we have to get what we want”. The presentations and much of the discussions focused on the need for the Nigerian leadership and the citizenry to harness its enormous human and natural resources to steer the country out of the woods, based on the lead paper titled: Ending Poverty: Using what we have to get what we want.

 

Observations

1.      Nigeria has the fortune of having qualified human and natural resources, a large and diverse population and one of the best weather of any country in the world. Its large and progressive population together with abundant mineral resources can be used to transform the nation into a rich country if they are well utilized and managed.

2.      However, with a population that will reach 200 million in less than three years, our per capita income is very low, meaning that poverty is highly prevalent in our society.

3.      Poverty is at the heart of where we are: at the heart of the problems that bedevil the country. Given our God-given resources (human and natural), we have no reason to house a large population of poor people.

4.      Despite huge potentials in terms of human and natural resources, Nigeria ranks among the lowest globally in development indicators.

5.      Our life expectancy is about 54 years, yet we export a large pool of medical doctors to other countries. While other countries’ life expectancy is rising, ours is either stagnated, or going down.

6.      The problem is squarely on the door steps of the leadership. However, it is important to understand that these leaders did not emerge from the moon. They are products of our communities and societies. So, if the leaders do not perform, it follows that something is also wrong with the communities and societies that produced them, and the rest of us.

7.      Nigeria is about 194 million in population presently. It is projected that by 2050, it will hit 400 million. If Nigeria cannot feed 194 million people today, what plans do we have to feed 400 million by 2050?

8.      Nigeria’s problem is not lack of vision, but lack of will and good strategy to mitigate the disaster that has been wrought upon this nation over the years.

9.      Nigeria has always had ambitious visions and policies, but execution is hollow due both to the lack of will and a committed strategy for implementation.

10.  Nigeria suffers from high inflation rates because the wealthy indulge in luxury goods that are usually imported; this has the net effect of depriving the economy of the needed multiplier effect or impact.

11.  Nigeria’s entire economy is premised on maintaining an exchange rate mechanism that encourages imports, unattractive for exports and manufacturing. In other words, it runs a ‘wacko’ economy, designed to create jobs and opportunities for foreign countries.

12.  Increase in commodity prices alone, particularly crude oil (which contributes less than 10% to the GDP), does not aid the economy. This is because it only makes available an increase in the foreign currency available to be spent, aids corruption, stifles entrepreneurship, encourages laziness and kills industry.

13.  The Asian Tigers have succeeded without as much human and material resources as Nigeria is endowed with. If they can be where they are today, Nigeria should even be better.

14.  Nigeria runs a top-down economy rather than a bottom-up economy. A bottom-up economy would have enabled the citizens to be gainfully employed thereby enabling the government to generate its revenue largely through taxation, instead of the present practice where the government operates a rent-seeking economy.

15.  The implication of the above is that rents and duties are obtained by the government and then it tries to infuse or monetize the economy top down, causing the economy to be largely dependent on handouts, and thereby becoming a ‘goodwill’ economy. This makes the citizenry to be heavily dependent on government patronage.

16.  Nigeria, until recently flared an estimated 2.5 billion cubic feet of gas daily. This is equivalent to 25 million liters of diesel which is enough fuel to power all the turbines required to electrify Africa. This we did for well over 30years.

17.  Nigeria's finance sector is bedeviled principally by two twin evils: high interest rate and short tenured finances. The former is as a result of an assumed high inflation rate and cost of doing business and the latter the unavailability of credits due to low savings.

18.  Agriculture is touted as the way out for our economic conundrum, especially as regards food security, job creation and foreign exchange conservation. But until agriculture is applicable to industry, it will perpetually remain at the subsistence level.

19.  Nigeria's trade policy is devoid of strategy, more especially as there is no specialization. Trading within and amongst West Africa in dollar denominated currency where there are regional banks such as Ecobank, UBA, Zenith and GTB  does not augur well for the economy.

 

 

Recommendations

1.      Education is a very important tool of tackling poverty. The abundant human resources should be empowered through education, training and retraining, while the material resources should be properly utilized. This is because there is a strong relationship between illiteracy and poverty.

2.      In order to reduce the rate of inflation, Nigeria’s economic managers should properly redistribute wealth and cause more people to be income earning.

3.      Management of the economy is not only measured by how low the government can keep the exchange rate, since this is mainly beneficial to their wealthy acolytes. Government should rather create more jobs in the real sectors of the economy. This will help not only in the redistribution of wealth but also enabling citizens to earn a living.

4.      To further remedy the situation and bring about a reversal of the level of poverty in the country, Nigeria needs to design an economic blueprint that can ensure a growth rate in the real sectors of the economy of about 15% annually, consecutively for 10 years to bring the country to terms with its projected population growth, and its need and place in the comity of nations.

(4i) With a projected population of about 230 million persons by 2030, this economic blueprint will ensure a minimum of $2.5 trillion economy, averaging a per capita income of $10,500 that would generate growth in sectors such as manufacturing, agriculture, intellectual property and information technology.

5.      Nigeria should take a cue from the Asian Tigers which have succeeded without as much human and material resources as Nigeria is endowed with. Our material resources should serve as a catalyst to fast track the process.

6.      Nigeria should change from running a top-down economy to running a bottom-up economy. This will enable the citizens to be gainfully employed and thereby helping the government to generate its revenue largely through taxation. In other words, the wellbeing of the government is to be dependent on the productivity of the people.

7.      Instead of continuing with the wasteful practice of gas flaring, Nigeria can process this flared gas and pipe it nationwide as a subsidy (even free) for productive investment, helping to ameliorate other hardships experienced in doing business in a difficult environment. It can also help to fuel our economic growth, catalyze productivity, increase GDP, increase employment and make goods made in Nigeria globally competitive.

8.      To strengthen Nigeria’s finance sector, the tax system should be streamlined and strengthened, especially at the local government levels. Presently, it is so haphazard, discretionary and confusing that it is a major disincentive for investment. An effective tax administration system will create more revenue for the government.

9.      Encouraging the widening and enforcement of insurance will also create a vast pool of funds that will further ensure the availability of credit. Government should therefore ensure that an effective insurance policy is not only in place but also implemented effectively.

10.  Nigeria should discourage the importation of goods it has comparative advantage in producing. Import substitution by local manufacturers is imperative, if not for foreign exchange conservation, at least for job creation.

11.  Agriculture is the surest way out of our economic conundrum, especially as regards food security, job creation and foreign exchange conservation. But it is not yet applicable to industry, and it has perpetually remained at the subsistence level. Government should therefore encourage farmers with subsidies to engage in mechanized farming to increase agricultural output.

12.  Nigeria’s trade policy should be refocused and in tune with the demands of the time. Moreover, trading within the sub-region should be made in the local currency of the member states and exchanged for the appropriate local currency of the seller state via any of the regional banks.

13.  Nigeria should aggressively pursue a housing program of up to 2 million units in new towns using alternate building methods. The Naval housing scheme/model in Calabar should be replicated on a national scale to bridge the 20 million housing shortage.

Poverty will greatly be reduced if government ensures that every Nigerian is skilled, has access to healthcare, and has the requisite infrastructure to further his aspirations and the basic technological knowhow to function in a digital world.

African Heritage Institution

54 Nza Street Independence Layout Enugu

by phone: +234 706 209 3690, 809 347 0589

by e-mail: info@afriheritage.org

 

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