Wednesday, 7 December 2016

NIGERIA AND THE HYPOTHESIS OF ECONOMIC GROWTH

By Chris Chukwubuzor Azuka
Image result for picture of Buhari

An Average Nigerian citizen is being regularly bombarded with analyses and statistics which tend to paint a picture of prosperity and  economic growth in his country even when his standard of living remains stagnant or is even declining. And when he has little or no access to  his basic needs. It's imperative therefore,  that someone takes a little time to attempt to understand the very nature of, or perhaps, the politics of economic growth in Nigeria, especially, over the past few years.
At every giving opportunity, Nigeria's former leaders have bragged about how they had grown their nation's economy over the years. Recently, while participating in an Al-Jazeera programme: The Stream, the immediate past Nigeria's finance minister, Dr. Ngozi Okonjo Iweala had spoken glowingly on how she grew Nigeria's economy in the seven cumulative years that she was at the helm of affairs at the country's finance ministry. Sometime in February, 2014 , Dr. Iweala had announced to the world that her country's economy had overtaking the economy of South Africa as the largest economy in Africa after it's rebasing. Needless to add that the South Africa's economy has since retaking the number one spot from Nigeria following the crash of crude oil prices in the international market coupled with the widespread attacks on oil installations in the Niger Delta region by the Niger Delta Avengers all of which combined to push the Nigerian economy into recession.
At every stage of engagement since leaving office about one and a half years ago, Nigeria's immediate past president, Dr Goodluck Jonathan has never failed to remind the world of his management intelligence, regarding the so-called economic growth under his watch. During the administration of former President Olusegun Obasanjo, Nigerians were inundated with statistics of flattering economic growth The growth rate for the GDP which was averaging 4.2% annually over the previous decades reached its highest peak of 19.17% in the fourth quarter of 2004 before declining later. Under President Jonathan, the annual growth rate for the GDP was averaging 6.5% until it dropped to around 3.8% in the last quarter of 2014 and further declined the following months. Interestingly, while the governments at different times rolled out their drums to celebrate their so-called economic growth, many analysts had wondered why those figures had not positively impacted the lives of majority of the citizen!
This is not a repudiation of the success stories, or the so-called economic miracles in the era under examination, even though the widely acclaimed economic growth of the past sixteen years- a period of unprecedented financial abundance did not have any serious or irreversible positive impact  on the lives of the overwhelming majority of Nigerians. For instance, it was a period in which the Nigeria's youth unemployment crisis escalated. The skyrocketing unemployment level means that about 80 millions Nigerian youths are currently hungry and unemployed. The national minimum wage was and has remained so poor that several other millions who may be working are also living below poverty line. Also Nigeria's reckless importation culture continued during the period unabated with the country needlessly importing products and materials of which about 80% of them can be conveniently produced locally if the elements are on the ground. Interestingly, the world sixth largest producer of crude oil spent about 40% of her foreign exchange earnings importing and subsidizing refined petroleum products which it ought to have the capacity to produce well enough for both domestic consumption and export purposes. Then high trade deficits, negative balance of payment, and depleted foreign exchange reserve among others.
So what exactly is economic growth? According to Investopedia.com, "economic growth is an increase in the capacity of an economy to produce goods and services, compared from one period of time to another. It can be measured in nominal or real terms, the later of which is adjusted for inflation".  On the other hand, according towww.svbic.com, "From a policy perspective, economic development can be defined as efforts that seek to improve the economic well-being and quality of life for a community by creating and/ or retaining jobs and supporting or growing income and tax base". It's clear that there was no real economic growth that was capable of spurring economic development in Nigeria, especially, considering the situation in the energy sector, and then in the manufacturing or industrial sector, among others
It's pertinent to look at the period between 1999 - 2015 which is widely regarded as Nigeria's most prosperous era. It was within this time frame that the country witnessed another period of "Oil Boom"  following the end of the first oil boom era in the middle of 1981. Interestingly, the second oil boom era excitedly coincided with the Information Communication Technology/Internet boom which combined effectively to spur an impressive and unprecedented economic activities andl growth, especially, in the communication and financial sectors. Curiously, the three administrations that ruled Nigeria in the last sixteen years actually generated about N100 trillion in combined revenue. Sadly, in terms of real economic growth and  development,  just like in  the case of the first oil boom era, the second oil boom era had come and gone leaving nothing behind.
Did ex-President Jonathan hand over the largest economy in Africa and one of the fastest growing economies in the world to President Buhari on May 29, 2015 as he often claims? The answer is no. What the former president handed over to his successor were three dilapidated refineries, and an electricity generation capacity of about 3000mw. Interestingly, South Africa with just over 50 million population has 49,393 mw generating capacity and is due to add an additional 40,000mw by 2025. Dr. Jonathan also handed over to President Buhari a population of over 80 million hungry and jobless Nigerian  youths who can become on the strength of their numbers, the third most populated country in Africa.

Chris Chukwubuzor Azuka
National Coordinator,
Save the Dream Nigeria-Project,
azucomms2000@gmail.com.
Azuka



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