Worried by the rather slow pace of development and growth in major commanding heights of the economy, Nigerians from different walks of life have suggested major priority areas for the three tiers of government to focus on in 2019. Ibrahim Apekahde Yusuf and Charles Okonji examine the issues
For many Nigerians who continue to pine under the yoke of poverty and suffer privations more than they are willing to admit, they would rather the government hits the ground and start running so the economy can be back on an even keel.
Agenda 2019
The outcome of a forum last Wednesday in Lagos at the public presentation of the 2019 Outlook for the Nigerian Economic and Financial Markets report titled, ‘On the Precipice’ by the Afrinvest (West Africa) Limited gave a bird’s eye view of expectations on the economy.
The report offers insights into the social, economic and political risks and potentials that will affect the growth of the economy in 2019 and beyond.
Going down memory lane, the Agency recalled that 2018 was a year of slow, anaemic growth in the Nigerian economy. While 2017 heralded a resurgence of the Nigerian economy, some of the widespread challenges that induced the recession in 2016 persist, threatening to be exposed by any substantial economic pressure. The report outlines critical factors that will determine whether the country can move to a more accelerated phase of growth or would be plunged into a cycle of contraction.
According to the Group Managing Director of Afrinvest, Ike Chioke, “We see the 2019 general elections as an opportunity to press the reset button and set the country on a path of sustainable growth and prosperity. 2018 may have delivered some positives but growth remains far below long-term levels of 6 – 7%. Furthermore, unemployment and underemployment numbers have gone up, Nigeria has been named the poverty capital of the world and there are elevated security threats across regions.
“Our outlook for 2019 is, therefore, largely dependent on the outcome of the general elections. At present, the race appears to be keenly contested by the incumbent party – APC – and the major opposition party – PDP. Whatever the outcome, one thing is certain: the winner must hit the ground running with the energy and political will to implement market-driven reforms that will boost economic growth and development.”
Expatiating, the Afrinvest boss said, the report provides scenario-based projections for the economy. “We have outlined a base case where the incumbent returns and there is policy continuity; a pessimistic case where political tensions escalate leading to widespread insecurity; and an optimistic case where regardless of the winner, we see exciting policy reforms that can deliver real growth.
“In view of the insufficient response to economic frailties so far, we believe that challenges facing the Nigerian economy are bound to persist. The two pillars of growth since the start of the millennium within the non-oil sector – agriculture and services sector – have come under enormous pressure of late and only a rejig of the current economic structure and fundamentals through reforms will provide respite. As critical structural reforms have been abandoned, we only anticipate anaemic growth, making a return to trend over the next five years highly elusive. Already, forecasts from the IMF also paint a worrying picture with the suggestion that Nigeria could suffer declines in per capita income up till 2023 – this would indicate eight-consecutive declines from 2016.”
Speaking with a cross-session of experts they expressed the view and very strongly too that government needs to address frontally include: oil & gas sector reform, power sector reform, infrastructural development, agriculture, monetary policy initiative, human capital development.
Besides, the economic and financial pundits impress on the government the need to address tax reform, boost competitiveness in the productive sector and manufacturing, enhance security architecture of the country as well as build democratic institutions and encourage good corporate governance.
According to Dr. Titus Okunronmu, a former Director, Budgetary Department, Central Bank of Nigeria (CBN), government needs to place more priority on agricultural development rather than focusing on oil.
“If we refine our petroleum product today, Nigeria would stop exporting crude oil, and the whole world would start buying our refined petroleum products, and they would have no choice immediately we don’t export a barrel, the whole world would be begging to buy from Nigeria its refined petroleum products, so we would earning foreign exchange instead of borrowing to finance the economy. So, once the refineries are working, Nigeria’s refined petroleum products would be sold all over the world.”
He also admonished that the industry and commerce should be encouraged to thrive, stressing that “Anyone doing business in Nigeria that wants succeed, must have one or two generating sets. But there is no place in the whole world where they depend on generator; it is only in Nigeria that can see such. But God has given us four major sources of power that we do not need to have a generator that is making noise. Again, when we export the crude oil, we flair the gas that comes with it, but the scientist told us that the gas we are flaring is sufficient to generate power for the whole of Africa, yet we are living in darkness.”
Echoing similar sentiments, Prof. Sheriffdeen Tella, an economist and former Vice-Chancellor, Crescent University, Abeokuta, Ogun state Senior Lecturer at the state-owned Olabisi Onabanjo University, Ago-Iwoye said, the government must continue with the infrastructural development, particularly with respect to road and rail.
“On the rail aspect, we must shift attention to passenger rail. And I think what they should doing is to now focus on cargo. The rail should be able to carry cargo because it is the trailers and trucks that are destroying the roads. So if they want the roads to last long they should shift attention to cargo rail so that most of these cargoes can be carried through the rails to the rest of the country instead of using the trailers.”
He also advised the government to support agriculture and industrial development. “Thankfully, the government has just got $1.1billion loan from Brazil to develop the nation’s agriculture sector. I think it’s a good thing. So when you combine the employment that the two of them would generate, you can imagine how humongous that would be. And this nagging issue of growing unemployed youths would reduce greatly. But the government would not be involved in industrial development directly but would make policies that would create the enabling environment for businesses to thrive including new and existing ones to be able to expand. Of course, one way the government can encourage business is to grant them incentives like tax holidays amongst other reliefs. That is how it is done elsewhere.”
In the view of Dr. John Isemede, former Director General of Nigeria Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), every government needs to address the issue of development at all levels, failing which it loses its relevance.
Isemede who is currently consultant to the United Nations Industrial Development Organisation (UNIDO) said, the diversification of the economy needs to be taken seriously.
“You cannot diversify from primary to primary. What we are hearing is that they have diversified into agriculture, have you been able to develop the agricultural value chain? What programme do you have for farmers? Of course, the Anchor Borrowers fund is OK. But in two or three years, if there is a bumper harvest, where are the processors? If you now move to the last level which is export, what have you put in place to drive the chain from the farmer to the processors and to the international market?”
Isemede who was unsparing of the organised private sector, said the operators were not helping matters at all. Raising a poser, he asked, “How organised are they? They go about signing agreements, organising the Lagos Trade Fair, the Enugu Trade Fair, the Abuja Trade Fair, and you don’t even see their pavilion, and they do not showcase any product. They are importers representatives, even the committee set up by the government has not called anybody to come and educate them. Some of us would have told them that this was what we need at the ECOWAS. But the committee set up at that time advised that Nigeria sign the agreement. What I am saying is that the OPS is supposed to be ate fore front, but they are now at the back seat, which is now creating the hic-ups that we have not signed.”
Leave a Reply