Category: Comments

The on-going polemic vis-à-vis the quit notice by the Arewa Youth to the South-eastern residents in the northern parts of the country to relocate to their home base shortly has brought to the fore, once again, the convoluting character of Nigeria’s federal arrangement. Worse still, despite acting President Yemi Osinbajo’s warning against hate speeches and threats from any part of the country, a coalition of Niger Delta militants has insisted on its quit notice to northerners’ living in the oil-rich region too.  What a dilemma!

Whatever divide one may be, the mere fact that since 1954 Lyttleton constitution which laid the foundation for classical federation for Nigeria, Nigerians are still discussing whether they want to live together peacefully or otherwise is a source of serious concern.  No doubt, it is a failure of national integration efforts since independence.

One fundamental concern of federal scholars is the absurdity of federal solution in Nigeria which has incapacitated the polity and greatly hampered federalism and national cohesion in Nigeria.  The quit notice threat whether it is an empty one so to say, or real calls to question the capability of the political elite to manage a polity as ethnically diverse as Nigeria.

At the beginning of the 1960s, there were over 3,000 ethnic groups in the world; about 1,000 were represented in Africa and about 445 in Nigeria!  In that wise, Nigeria has a relatively unique problem of achieving solidarity in action and purpose in the midst of hundreds ethnic nationalities where justice reigns.  This uniqueness creates unique problems unknown to the experience of other peoples in the world. No western or eastern civilization has ever evolved a political system that can cope with this gigantic problem of hyper-ethnic instability syndrome. This is calling to question the capability of Nigerian rulers their commitment to achieving what ‘Napoleon could not’.

It is rather unfortunate that both public policy makers and ruling elites in Nigeria do not sufficiently appreciate magnitude of the problems at hand.  Since 1954, the federal system which is older than the state that got independence in 1960 is still far from being crises-free and national cohesion continues to be elusive.  Nigeria’s ethnic make-up still remains what J.S. Furnival calls “in the strictest sense a medley (of peoples) for they mix but do not combine”.

Thus, the Nigeria ‘project’ remains questionable despite years of federal practice.  According to The Economist (19-25 June, 1999), “Nigerians have no common vision of a nation-state called Nigeria, no sense of citizenship.  The name and football team are about the only things that unite them.  Even the footballers, however, brilliant individual players though do not work as a team.  It is the same with the country.  More than 56 years of flag independence, the country still totters on as a toddler, often pulled down by joint identity and integration crises.  To discerning observers’ consternation, Nigeria’s federalism has remained fragile, almost impossible.  This is largely due to successive administrations that have always been permanently assailed by curious depressing distribution crises triggered by a dubious formula for the sharing of national benefits. The fiscal arrangement which is no doubt one that is robbing Peter to pay Paul has always been a source of destabilizing force.

Be that as it may, the Nigerian story is a long stretch of political narratives that do not inspire hope for the future (in the words of Tunji Olaopa).  Akin Mabogunje too, a distinguished professor similarly averred that the atmosphere of the last two weeks has been so charged that one can be forgiven for wondering if we were back in those heady days of 1966, that presaged the 30-month agonizing unforgettable  civil war.

The snag in the case of Nigeria is the false hope that federalism is capable of enhancing seamless unity in diversity.  To Emeritus Professor John Ayoade, a federalist, “many federalists expect from federalism what it is not designed to give – that is unity – without the accompanying federal spirit cum other requirements.  With that mind-set, the snag with the federal arrangement in Nigeria is daunting. Whereas, federal solution in a plural and deeply divided society is a balancing act that must be tailored to suit the demands of the society; rather than aping a system without adaptability to the environment.

If the federal arrangement is to be re-invented, the first step is to devolve powers to the two-tiers of government – states and local governments – the present structure is too centralized which was even exacerbated by the military interregnum for decades.  What we need today is a non-centralized federal system, in which state governments are politically virile, legislatively strong, financially resilient, and indeed constituted into self-confident and self-assertive centres of respect by the political loyalty from the citizens they served and over whom they exercise authority. The story is the reverse in contemporary Nigeria safe for few states with buoyant Internally Generated Revenue (I.G.R.) that guarantees financial sustainability.

Nonetheless, the problematic nature of Nigeria’s citizenship is another terrain of Nigerian federalism, which in no small measure undermines the efficiency of the federal structure.

Conclusively, there is an imperatival need to re-invent the federal system.  If the former Soviet federation (USSR) contracted by Joseph Stalin as far back as 1914 disintegrated in early 80s, Nigeria’s amalgamation was done in 1914 with federal constitution in 1954 and flag independence in 1960. Thus, if soviet federation could disintegrate despite being a developed state in all ramifications, Nigeria needs to watch it.  The greatest undoing of the octopus federal system now is the ‘monarchical spirit’ being exhibited by the northern potentates; same Russian hegemony akin to the monarchical spirit ongoing in Nigeria crumbled Soviet federation.  We need to learn fast.  Let us restructure or at best review the recommendations of the previous confab reports. It is high time the National Assembly beamed its searchlight on those reports. A stich in time they say saves nine.

• Dr. Ojo, is Chief of Staff to the Governor of Oyo State.

This treatise on the Nigerian economy offers a simple technical explanation of the socio-economic malaise plaguing the nation. Unfortunately, this situation has been with us for the last 50 years or so. And may remain with us for a long time if we do not get the right set of persons to lead us for a sufficiently long period of restitution. Such group of persons must be sufficiently knowledgeable about the situation of things and the pathways out of the woods. They must be sincere about the actions being pursued, have the capacity for hard work, be good managers of human and material resources and can govern and lead the society with the core values of service, passion, integrity, resourcefulness, inclusiveness and team work (SPIRIT). It is such leadership that can bring us out of the present situation. In view of the almost permanent nature of this parlous state, it can be aptly described as a perpetual state of disequilibrium, a situation which can be perceived as hopeless.

Generally, a disequilibrium situation is one that deviates from the norm or ideal position and needs restoration through serious thinking and hard work with a modicum of luck from divine intervention. A good example from the science of economics is when the supply of a commodity is equal to the demand for the commodity in the market. In such a situation, the price of the commodity is optimum because at that price, the supplier of the community is willing to sell and the customer is willing to buy. The optimum price is the equilibrium price for the commodity at the particular time, ceteris paribus (all things being equal). When a disequilibrium situation occurs in the market for commodities, it is reflected in the prices. If the demand for a commodity is more than the supply at a particular time or place, its price will be above its equilibrium price and vice versa. In an increased price situation, the market is sending signals to those that can influence the supply chain to increase supply of the commodity in order to moderate the price and restore equilibrium. This market could be a “rice market” or “dollar market” as presented manifested in the Nigerian commodity markets. Such situation however occurs in a market in which some structural problems do not hinder the production and/or supply of the commodity. If any structural problem exists to hinder supply on a permanent basis, equilibrium will not be restored and the dislocation in the system continues leading to a perpetual state of disequilibrium.

In the real world, the commodity space is multi-dimensional and complex with many commodities and prices. Imagine a market situation where there are no shortages, that is, demands are completely met with the available supplies in the various markets for goods and services and everyone gets all what he or she wants in the right quantities, at the right time, in the right places and at the right prices. Such a market situation can be equated to a bliss point in life, that is, a situation of extreme happiness close to what clerics preach about heaven. But, is this the world of ours in Nigeria? Evidence abounds to demonstrate that we are very far from this bliss point. In our case, it is a situation of shortages galore. This disequilibrium situation manifests in several ways and are observable through; Rising inflation, very limited job opportunities for the youth, uncontrolled population growth, prevalence of abject poverty, pervasive corruption, primitive urban and rural market outlets, overdependence on foreign goods, depletion of our foreign exchange reserves, harsh foreign exchange regime, low agricultural productivity, non-productive manufacturing sector, ethnic tension and excessive allegiance to tribes, increasing religious intolerance, suspicion and divisions amongst Nigerians, anxiety and discomfort in many homes, crude oil production and export below OPEC quotas, worsening recession, regular attacks of armed robbery, Boko Haram insurgency, cattle rustling and farmer/herdsmen clashes, poor electricity supply, badly managed aviation industry, dysfunctional rail system, bad rural, urban and trunk roads, dysfunctional school system,  badly structured federation, prevalence of abject poverty, pervasive corruption, non-alignment of fiscal and monetary policies, outdated health system, no consensus on national objectives, costly and wasteful political system, very limited access to potable water, dysfunctional public service, poor policing and increased insecurity, rampant incidences of kidnapping, restiveness in the Niger Delta region and other dislocations.

The foregoing itemization of deviations from norms in the Nigerian economy is not exhaustive in any way. These signs of anomalies are obvious on a daily basis and they have to be corrected and equilibrium restored to make people happy. Restoring equilibrium is a herculean task that needs a large dose of strength, diligence, discipline, courage and intelligence that are generally in short supply amongst the core set of political and administrative leaders we have at the national and sub-national levels of government. The situation is more challenging at the sub-national levels where, for example, local government councils are completely dysfunctional and not performing any of their constitutional roles in grassroots development. And, most state governments are poor managers of resources engaging mainly in wasteful and politically visible large projects (like building airports, dual carriage city roads and mega schools) that eat-up their meagre resources with nothing left to perform their traditional development roles and fail to pay salaries of public servants and pensions and gratuities to retirees when due.

The situation at the federal level is not different with constitutionally too much ascribed fiscal responsibilities and penchant for wasteful and relaxed spending. By the latest count, there are over 400 federal MDAs with other numerous cost centres in the executive and legislative arms of government and hundreds of thousands of federal public servants expending over 80 per cent of the annual budgets on recurrent expenditures with little left for development projects. A fundamental outcome of this approach to governance in which plenty of money from government is being continually pumped into the economy without a strong productive base and functional infrastructure results in too much money chasing too few goods with the attendant upward pressure on inflation. This is the situation we are today in all our various markets.

In concluding, it will make sense to borrow some lessons from Robert S. McNamara, an astute economist in the era of late President John Kennedy of the United States of America, who asserted in one of his brilliant essays some 50 years ago that there cannot be peace in a society without development. By development, we mean a society without food shortages, without population explosion, without low level of productivity in the agricultural and manufacturing sectors of the economy, without low level of personal income (aka poverty), without low level technology of production, without dysfunctional and insufficient economic and social infrastructure and without high unemployment. If these ideal conditions do not prevail, that is, equilibrium is not restored in the markets, economic history teaches us that conflicts within the society will occur often resulting in ethnocentrism with likely occurrences of violence, bloodletting and war as happened in Europe prior to the Second World War, before our own Civil War and before the present conflict in Syria. The absence of development begets ethnic tension, tribalism, nepotism, corruption and other unwholesome human behaviours common in poor societies.

• Prof. Akinyosoye is a professor of Applied Economics and Data Management.

The African Development Bank (AfDB) under its current leadership, has identified five high priority areas that it believes Africa must address in order to reach its development potentials. Those high 5s include Light up and Power Africa; Feed Africa; Industrialize Africa; Integrate Africa; and Improve the Quality of Life for the People of Africa.

Any serious observer of Africa’s development challenges will readily agree that these are indeed critical areas that need urgent and sustained attention by Africa’s governments, development partners and the private sector. They speak to the challenges of infrastructure deficit; agricultural stagnation and food insecurity; lack of meaningful industrialization and value-added production; the poor integration of Africa’s economies, partly resulting from weak regional infrastructure and the legacy of colonial trade patterns; and Africa’s dismal ranking in the indices of human development, including life expectancy, infant and maternal mortality, poor sanitation, high levels of illiteracy and poor access to education and skills training.

The Current situation:

Despite enormous potentials for energy generation, including renewables, energy generation in Africa has been rather dismal.  As the AfDB note, only about 40% of Africans have access to electricity, the lowest access rate in the world. On per capita basis Africans (outside of South Africa) consume 180 kWh of electricity. Compared to 13,000 kWh in the U.S. and 6,500 kWh in Europe, that is really dismal.

The inadequacy of power is emblematic of the broader infrastructure deficit in Africa, including transportation, health and educational infrastructure. This inadequacy has had a huge impact on Africa’s development as it discourages investment, raises the cost of doing business, worsens health conditions of citizens and impedes access to education, among other effects.

The AfDB has set a goal of universal access to electricity for the continent by 2015 and has mapped out clear principles and strategies for achieving that, including greater investment, improving policy environment, improving sector regulation, transforming the energy companies and encouraging regional projects to drive integration.

Feed Africa through agricultural transformation is the second high 5. Despite having 60% of the world’s unused arable land, a quarter of Africa’s population is under-nourished, making Africa the most food insecure in the world. This is notwithstanding that agriculture employs 60% of Africa’s workforce.

The Bank plans to transform Africa’s agriculture in order to unlock its potential and improve job creation to help diversify Africa’s economies. It plans to do this by developing an inclusive and competitive African agribusiness sector with the goal of helping to end poverty, hunger and malnutrition, turning African to a net exporter of food, and moving Africa to the top of export-oriented value chains where it has comparative advantage.

On industrialization and economic diversification the AfDB notes that Africa is at the bottom of the global values chain with Africa’s share of manufacturing at less than 2%. The continent continues to rely excessively on raw commodities export. Thus the share of manufactured goods in Africa’s imports is three quarters while the share of manufactured goods in its exports is less than one-fifth.

The Bank calls for a bold agenda of industrialization to be led by the private sector, with its support.

Integrate Africa is the Bank’s fourth high 5: Here the Bank notes that weak integration of African economies evidenced by the paltry intra-African trade.  In a paper she published in 1993 Faezeh Faroutan noted that Sub-Saharan Africa’s GDP was equivalent to Belgium’s and wondered what it would look like if Belgium is divided into forty something countries, each with a separate and independent economy trying to relate with the rest of the world. That’s what, she pointed out, Africa looks like in its fragmentation into several tiny economies. Yet as the AfDB notes intra-African trade is the lowest in the world, roughly 15%. The comparable figure for the North American Free Trade Area was 54% and the European Union 70% and Asia 60%. Boosting African integration, it argues, will involve building regional infrastructure, boosting intra-African trade and investment, and facilitating the movement of people across borders. These will help Africa develop a truly regional market.

Improve the Quality of Life for the People of Africa is the fifth high priority area for Africa, according to the Bank. This is to be accomplished through the provision of access to social and economic opportunities. Goals include creating jobs, building critical skills, improving access to water and sanitation, and strengthening health systems. The Bank notes that despite the improved economic climate in Africa in the past decade, many African countries are still bedeviled by widespread poverty and inequality, poor health and education outcomes and inadequate access to sanitation and safe drinking water.

The AfDB’s choice of priority areas and Plan to assist in addressing them will surely make a huge positive difference. And, fortunately, Africa’s leaders also recognize these challenges and the urgent need to address them. They are making concerted efforts, including seeking out new development partners such as China to help with infrastructure improvement. New railway systems, roads, bridges, ports and gleaming new office buildings are springing up across Africa as a result. But the current efforts are not adequate. Indeed progress has been made in all five areas. Yet much more needs to be done.

These inadequacies are real.  As a businessman I can tell you about my personal experience.  A little more than decade ago, I founded the American University of Nigeria located in Yola, my hometown, in Nigeria’s North East, one of the poorest regions of the country. Before then I had created and been supporting a first-rate boarding school – kindergarten through high school – also in Yola.

Like other Africans who have achieved modest success, I had been engaged in different aspects of philanthropy.  But education, I thought, would be my best gift to society. To some people trying to build a world-class university in Yola might seem irrational. To run the university we had to provide access roads, provide our own water though boreholes, build and run our own power plant, provide our own telephone and internet infrastructure, pay for a private security force, and so on.

You might wonder whether it wouldn’t be more cost effective, to just use that money to provide scholarship funds for students to study elsewhere, such as Nottingham. With the money now being used to run our AUN power plant, construct our buildings, and pay our security force and the like, a great many more students could be sent here to study.

But I wanted to help develop my country in deeper and more holistic ways. It would be counter-productive to facilitate the brain drain out of Africa.  We need these bright young people in Africa. We need them to understand the problems in Africa. We need them to contribute towards Africa’s development.  And we need them to be able to tell the stories of their accomplishments in the face of enormous odds.

But the cost is huge and it is what typically confronts the typical investors. The huge infrastructure gap means that as an investor you often have to provide your own electricity, your own water, and you even fix roads to your business locations. That discourages investors. Thus small businesses that would provide ancillary services to a major establishment are often absent. For instance, in the same town, Yola, where we have our school system, we established a printing press, built our own hotel to carter to those who visit, established a beverage plant to, among other things, manufacture still drinking water and fruit juices.  We established petrol and diesel filling stations to help serve our businesses and the general public.  We also established a radio and television station to help publicize what we do, in addition to providing distance learning. And we have a logistics company to help provide logistics for these various entities.  Because we have businesses with healthy revenue streams, we are able to access financing with greater ease than many others can. Currently the AUN contributes nearly $400 million dollars annually to the Yola economy.

But while we have some capacity to treat some of the infrastructure gaps as important investment opportunities, many small businesses lack the resources to engage in the kind of ‘self-help’ that we have engaged in regarding infrastructure provisioning. Thus small businesses, the real engine of job creation and employment, are most affected by the infrastructure and other inadequacies.

It is cheaper and more socially valuable for the state to provide much of the needed infrastructure, including doing so in partnership with the private sector. Infrastructure provisioning and a supportive regulatory environment will encourage more private sector investment and employment generation.

What’s Missing from the high 5s?

Let me say, however, that while security does not feature among the Bank’s top five priorities, it is a top priority for African countries. Security is a huge challenge and if not addressed may impede the implementation of the Bank’s plans, especially for fragile states. Africa’s public security challenges include terrorism, piracy, kidnappings, armed robbery, and banditry, herders and farmers’ clashes, and inter-ethnic and sectarian conflicts.  And these are present to varying degrees in all of Africa’s sub-regions. It is understandable that the Bank would select areas that are easily bankable. It is also the case role of the private sector in ameliorating the major security threats facing Africa, especially with respect to security policy has not been clearly delineated. African states and development partners must deepen their cooperation in the area of security, including security sector reforms to instill democratic norms and respect for human rights.

I also believe that Education should get more attention than the Bank’s high 5s seem to allow. Education should indeed be one of the top priorities for Africa. While education should be the primary responsibility of governments, it also clear that Africa’s educational challenges, in the context of competing demands and available resources, are beyond the capacity of many African states. Thus the private sector should be encouraged to do more in providing high quality education under clear standards maintained by the governments. The AfDB and other development banks can identify some public and private educational initiatives for support through, for instance, improving educational infrastructure including libraries, ICT, laboratories and technical workshops, and support for transitioning to renewable energy such as solar and wind.

Let me also say that Africa must get its politics right in order to accelerate its development.  This will include improvements in electoral systems, deepening of democracy and accountability, and reduction in corruption. Let’s not forget that these priorities have to be adopted by and implemented by governments, by the political leadership. Therefore, Africa needs mechanisms for producing leaders who privilege their countries and the continent over personal or sectional gains and interests.

Thus Africa’s civil society and Africa’s development partners have important roles in pressuring African governments on important political reforms to help provide the democratic spaces for policy dialogues and democratic interventions in Africa’s development.

• Excerpts from remarks by former Vice President Atiku Abubakar at the maiden University of Nottingham Africa Summit, at the University of Nottingham Great Hall, University Park, Nottingham, England, recently.