Last April, the world woke up to learn that Nigeria’s economic growth had surpassed those of other African states. Accordingly, her economy increased by 89 per cent or 80 trillion naira which is about $510bn. The economy of her closest rival, South Africa stood at $352bn.
This announcement caused quite serious reverberations throughout the world. It was particularly troubling to those watchers of Nigerian economic scene, and also those who expected South Africa to retain her economic leadership in Africa. They cried foul and thought the figures were fabricated, adding that there was no glaring evidence of economic trajectory to get to this figure.
Some other economists, nonetheless, examined past and current economic growths especially the emerging new categories like telecommunications and entertainment and believed that Nigeria got the requisite figures to get her to the rebased GDP number which they felt was long overdue.
This writer will now attempt to review the pros and cons of each side of the argument, find the balance and see to what extent the rebased GDP can facilitate the pace of economic development in Nigeria.
As was noted earlier on, certain scholars unleashed a volley of criticisms once they got the announcement that Nigeria had become the largest economy in Africa adding that they never saw it coming. They also argued that it was impossible to accept the figures for a country where 70 per cent of her population are poverty-trapped—earning about $2.00 a day. However shameful it was to see some Nigerians wallow in poverty in the midst of few others who live in material opulence, the fact of the matter is that economic growth is not another name for economic development. Nigeria had economic growth but has not developed her society.
As for the argument that successive administrations in Nigeria did not effectively address imbalance in the education sector, in health care, banking and agriculture to name but a few, meaning that they did not create the conducive infrastructure badly needed to validate the new GDP numbers or at least make them predictable we offer that these negatives had strong underpinnings on our current high unemployment figure of 23.9 per cent. They clearly do not affect the GDP outcome in any statistical way except that had the government done what was expected by tightening all the loose ends, the new GDP would have been even greater than N80tn.
Some critics also alleged that Nigeria has the tendency to announce large foreign reserves positives and go back to borrow greater amount of money to carry out her projects: to which we can say that such a principle has not negated the ability of Nigeria to amass wealth. The United States, by common knowledge, the largest economy in the world, as of the last check, still sometimes borrows money to carry out her projects. So, why is the principle of state borrowing a reason to criticise and castigate Nigeria.
There were a few other negative comments that could be construed to be demeaning to Nigeria but my task here is not to hold brief for Nigeria. We all know that the ability of any country to provide a balanced development for its people depends in large measure on the sagacity and foresight of their political leaders. Where leadership are courageous and wise, as Kayode Oluwa aptly observed in his article of July 10, 2014, they create a forum for “real and meaningful, progress development” which has as its cardinal objective “the attainment of a balanced, socio-economic structure through enhancing the creation of equitable distribution of wealth to minimise income inequalities and social disparities.
The efforts made by the Federal Government to rebase its GDP is a step in the right direction because the exercise could have far-reaching implications to redress quickly these inequalities in distribution thereby ushering in true development. This is why some economic experts threw in their support for the exercise. The new GDP has proved to be more elastic and in keeping with national and international expectations.
The experts thought that the enormous population of Nigeria — 170 million — should be seen for what it is, a plus because of the tremendous potential for consumption latent in that figure. The number was also slated to increase to 400 million by 2050 everything being equal. If that figure were to be effectively galvanised, especially in line with the goals enunciated in the Millennium Development Plan, it is anybody’s guess what a dynamic force that can be unleashed into the economy. It will probably be unprecedented, and something never before seen in the annals of economic development in Africa.
Prophylactic Pills. The road to achieve all this is not going to be easy. Both the governments of Nigeria and their people must be able to take their own prophylactic pills by investing in self- criticisms, in some hardships. Government must brace itself to act quickly and in concert to expand the prevailing tax base with a view to greatly improving the tax collection machinery. Next, it must do something quickly to address the banking sub-sector to make it more business friendly. Since the Federal Government cannot and should not do it alone, there is an urgent need to develop the private sector capacity to further help to cut down the level of unemployment. There is the issue also connected with very low energy output — a fact that has led inexorably to some big factories and industries going belly down. What about the unregulated use of generators. This leaves much to be desired as it brings environmental pollution in its wake. The list is not exhaustive. Suffice it to say that it is an affront to Nigerians that there still remain serious security lapses in Nigeria. Citizens and those who do business in the country deserve much more than the haphazard attention now paid to the sector. Look elsewhere for assistance, go out of the box and solve this. It has the capacity to ruin all that governments are doing to ensure prosperity to all Nigerians.
Nigerians must continue to remain one another’s best keepers, must be willing to share what we value most, because in sharing we become our best. We must be prepared to invest in the development of the individual, because an enlightened citizen is an asset for our collective security and healthy bottom line. The time is now — not yesterday and clearly not tomorrow. In the immortal words of Goethe, what we have is only the moment.
Written by ; CYRIL IFEDIGBO a retired Nigerian diplomat based in Washington, USA
