First there were the Brics. After coining that acronym in 2001, Jim O’Neill, then chief economist at Goldman Sachs, came up with the “Next Eleven” two years later, identifying 11 economies capable of joining the Brics as the world’s fastest-growing. Fidelity Investments developed this further when, in 2011, it identified the Mint economies, which it said could prove as rewarding for investors over the next decade as the Brics had been in the previous decade.
The Mints — Mexico, Indonesia, Nigeria and Turkey — have not kept that promise. Indonesia probably has been the most reliable, its economy growing at just under 5 per cent or more in every year since 2011. Turkey and Mexico have delivered variable growth. The worst of the four and the biggest disappointment by far has been Nigeria, which slid into recession in 2016, going on to achieve GDP growth of only 0.8 per cent last year.
Yet Nigeria boasts vast resources and huge potential. It is the world’s seventh most populous nation and by the middle of the century the United Nations expects it to be the third largest, with its population doubling from the present 200 million. Moreover, that population is urbanising rapidly, with Lagos projected to become the world’s biggest city by population by 2100.
As well as one of the world’s youngest and fastest-growing populations, Nigeria enjoys vast natural resources, most obviously oil and gas. It owns 2.2 per cent of proven global oil reserves, according to the BP Statistical Review of World Energy, while accounting for 1.3 per cent of global natural gas production. It also boasts generous gold, lead, zinc, coal and uranium reserves.
Why, then, does Nigeria’s economy underperform so dramatically? The most obvious answer is corruption. Nigeria is ranked 148th out of 180 in the latest corruption perceptions index published by Transparency International. Corruption and poverty go hand-in-hand, poverty is still rising and so is the jobless rate, because GDP growth is not keeping pace with population growth.
All this will be keenly debated in Nigeria’s presidential election, due in February next year, in which the incumbent, Muhammadu Buhari, will be standing. So, too, will be Atiku Abubakar, one of the candidates of the People’s Democratic Party, the party of former presidents Goodluck Jonathan and Olusegun Obasanjo, under whom Mr Abubakar served as vice president.
The most intriguing candidate is Kingsley Moghalu, a former deputy governor of the Central Bank of Nigeria and candidate of the Young Progressive Party. A lawyer who worked for the United Nations for 17 years and who was educated in Nigeria, the United States and Britain (he has a PhD in international relations from the London School of Economics), Mr Moghalu presents himself as a thoroughly modern presidential candidate in the mould of Emmanuel Macron.
Last week, while on a visit to the UK, he said: “One of the major things I am going to do is move away from dependence on oil and move the economy towards innovation. We will have to look very seriously at the philosophical foundations that drive successful capitalist economies, make sure that there’s property rights, make sure that there’s innovation, make sure that there is capital. I shall be introducing a major venture capital fund that is going to fund small businesses and stimulate the economy.”
Mr Moghalu’s policy prescription also includes more infrastructure investment. He accepts that while Nigeria has benefited from the process of “leapfrogging”, where a lack of landlines has encouraged rapid take-up of mobile technology and a lack of established electricity grids has enabled the rapid adoption of off-grid solar power, that can go only so far: “Nigeria, in particular, has a very high level of mobile phone technology and that’s a good thing, but I don’t think you can apply leapfrogging to every aspect of development. I still think Nigeria needs an industrial base. You can’t go into a post-industrial society, as some people recommend, without having been an industrial society.”
The would-be president also has controversial views on Chinese investment in Africa. He says that many African nations have not benefited as they should have done, arguing that a lot of the continent’s leaders have lacked the “intellectual soundness” to drive a harder bargain with the Chinese. He argues it has exacerbated debt traps around Africa and increased dependency on foreign loans. Two thirds of taxes raised in Nigeria go on servicing its debts.
Another key policy of Mr Moghalu is greater equality for women. He argues that Nigeria’s education and legal systems prevent too many women from reaching their potential and is promising a 50-50 gender balance in his ministerial appointments.
But is Nigeria ready for a technocratic president? Mr Moghalu, who points to his work nation-building in Rwanda, Angola and the former Yugoslavia during his time at the UN, insists that it is. Pointing out that the country has become poorer since it became a democracy in 1999, he argued: “The people of Nigeria are tired of the old, recycled and corrupt political class, which President Buhari’s government represents.”
Many will wish him luck. If this is to be the African century, the continent’s biggest country must fulfil its economic potential. If it does not and poverty continues to grow, the chances are that an increasing proportion of Nigeria’s growing population will head elsewhere, adding to the global migration crisis.
.Ian King is the business presenter for Sky News.