Nigeria: Road map for socio-economic recovery and sustainability, By Prof Uche Uwaleke

NIGERIA: ROADMAP FOR SOCIO-ECONOMIC RECOVERY AND SUSTAINABILITY

Keynote delivered by Prof Uche Uwaleke at the 7th Annual Conference of the Guild of Corporate Online Publishers (GOCOP), Abuja Continental Hotel (Old Sheraton Hotel), Abuja, on October 5, 2023.
Protocols
1. I feel highly honored by this invitation to deliver the keynote at this year’s Guild of Corporate Online Publishers’ (GOCOP) Annual Conference on the timely topic, ‘Nigeria: Roadmap for Socio-Economic Recovery and Sustainability’.
2. I consider the theme of this conference quite apt in view of the far-reaching reforms the present administration is undertaking to restore the country on the path of sustainable socio-economic growth after decades of mismanagement and wasted opportunities.
3. Over the years, the country has been bedeviled by several challenges which have hampered socio-economic progress and sustainable development despite sitting on huge resources.
4. In particular, the last ten years have been characterized by weak economic growth, elevated inflation, high unemployment and rising poverty. Poor access to credit, weak infrastructure, multiple taxes and the general unconducive business environment have led to the exit from Nigeria of many foreign businesses and shut-down of local firms thereby worsening the unemployment situation in the country.
5. Rise in insecurity such as banditry and kidnapping, remains a grave concern, as does corruption.
6. Additionally, poor access to quality education and healthcare has been a major issue, together with the adverse effects of climate change, such as flooding and desertification.

Key Social and Economic Trends in Nigeria, 2010-2023
Macro Variable 2010 – 2015 2016-2022 2023
GDP Growth Rate 5.53% 1.20% 2.31% Q2
Public Debt Stock N7.56 trillion in 2012 N20.37 trillion in 2017 N87.34 trillion as at June 2023
Inflation 10.39% 14.96% 25.80% Aug
Unemployment rate 20.9 29.4 4.1*
Percentage of the population living on less than $5.50 a day 90.50% 89.50% 90.80%
133million MDP
Foreign Investment (net inflows as a % of GDP) 1.30% 0.49% -0.04%
Infant mortality Rate (per 1,000 live births) 82 77 71
Children out of school (Primary) 8.6 million 14.3 million 20 million
Sources: https://www.macrotrends.net/countries/NGA/nigeria/poverty-rate; https://data.worldbank.org/; https://education-estimates.org/out-of-school/; NBS

7. Although, Nigeria’s economy grew at a rate of 5.53% from 2010 to 2015, this growth was not inclusive given the high rate of poverty during that period. Even then, economic growth slowed dramatically to 1.20% from 2016 to 2022. The country went through two cycles of economic recession: first in 2016 (on account of slump in crude oil price) and second in 2020 (largely due to COVID-19).
8. Nigeria’s public debt has increased significantly, from N7.56 trillion in 2012 to N87.34 trillion as at June 2023. This high level of debt makes it difficult for the government to finance its operations and invest in important development projects leaving the country more vulnerable to economic shocks. The recent fuel subsidy removal was compelled by this grave fiscal position.
9. Inflation rates in the country have remained high, rising from 10.39% between 2010 and 2015 to 25.80% as of August 2023. The unemployment rate also increased (despite new methodology adopted by the National Bureau of Statistics). By implication, the country’s misery index and poverty rate have been on the rise despite the Social Intervention efforts of the government. By 2022, the number of persons estimated to be multidimensionally poor in Nigeria was over 130 million!
10. Although the country has made some progress in reducing infant mortality, it still remains the highest contributor to the global under-five mortality rate. The number of children out of school has increased from about 8.6 million in 2010 to over 20 million in 2022.
11. It is not all woes though. Nigeria boasts a sizable youthful population with a strong digital presence leading the continent with 122.5 million digital internet users in 2023, representing 55.4% of the total population.
12. In early 2023, there were nearly 194 million active cellular mobile connections in Nigeria, equivalent to 87.7% of the population. Moreover, over 31.6 million Nigerians engage with social media, accounting for 14.3% of the total population. The internet has created employment opportunities for many Nigerians and has served as a platform to showcase Nigeria’s rich cultural heritage to the world.
13. Nigeria’s creative sector, projected to reach a valuation of US$15 billion by 2025, is a thriving industry driven by young and talented individuals. According to Statista, motion picture and music recording accounted for roughly N154 billion (about US$197.6 million) of Nigeria’s GDP in 2023. From film to music and fashion, the country’s creative sector holds significant global influence and has the potential to become a prominent exporter of Nigerian culture.
14. Although the size of the Nigeria’s capital market is small relative to the country’s economy, it has continued to serve as a source of medium-to-long term funds for governments and businesses. The remarkable improvements achieved in the last ten years especially in the area of market infrastructure and product offerings have contributed in no small measure to enhancing financial inclusion in the country.
15. As Nigeria matches on in her democratic journey, it is imperative to have a clear roadmap for socio-economic recovery and sustainability to allow for the delivery of democratic dividends. In addition to ensuring security of lives and property, rule of law and a commitment to the fight against corruption, it involves taking the following measures:
i. Productive-Base Expansion/Diversification:
a. Changing the structure of the economy from mono product to a multi-product one having capacity for multiple sources of forex; primary product to intermediate & finished products; Import dependency to export-led economy.
b. Promoting industrial parks and Privatization of state-owned businesses such as NNPCL through the capital market for inclusive economic growth.
c. Encouraging regions and states to identify areas of competitive advantage and set parameters to become self-sufficient economically.
ii. Infrastructure Development: Substantial investments in infrastructure are necessary to unlock economic potential. Some key measures include:
a. Facilitating private sector investment in the provision of key infrastructure: roads, railways, ports, energy. Breaking monopoly in the oil sector, rail transportation, power etc.
b. Updating and facilitating implementation of Integrated Infrastructural Development Master Plan.
c. Exploring innovative financing mechanisms such as asset securitization.
iii. Investing in Human Capital: Investments in education and healthcare will not only enhance the quality of life of the citizens but also equip them with the skills necessary for a modern workforce. In this regard, the following measures are recommended:
a. Promote free education up to senior secondary school.
b. Redesign curriculum at all levels with emphasis on computer literacy.
c. Identify and deliberately encourage the study of courses in tertiary institutions considered key to the Nation’s economic development. These Pillar courses (such as Agric Science, Engineering, ICT, Medical Science) should be highly subsidized by the government.
d. Partner the private sector for investment in vocational and technical Institutes.
e. Expand the National Health Insurance Scheme to accommodate those in the informal sector.
iv. Job creation and Poverty Reduction: Given Nigeria’s high unemployment rate and poverty level, particularly among the youth, the focus should be on MSMEs and employment-elastic sectors. There should be less emphasis on conditional cash transfers as these have proven to be ineffective in Nigeria. Rather, emphasis should be on:
a. Expanding existing capacity building programs for vocational and entrepreneurship trainings
b. Incentivizing banks to increase credit allocation to SMEs
c. Providing basic infrastructure such as electricity, water, security, access roads.
d. Continuously improving the ease of doing business for a more conducive business environment including harmonizing business taxes.
v. Promoting Inter-governmental Collaboration: Prominent among existing arrangements for inter-governmental policy collaboration is the National Economic Council that has state governors as members with the Vice President as the Chairman. Nevertheless, weaknesses in current coordination arrangements can be seen in the fact that Nigeria does not have a well-coordinated system for production of consolidated national reports on performance in individual sectors. For example, due to lack of sufficient information on performance of individual governments, it is difficult to estimate how much money the consolidated Nigerian governments spend on primary education, what the structure of this spending is, and what is achieved with these expenditures. Non-coordinated interventions of different government levels create a risk for duplication of efforts and sub-optimal allocation of resources.
In order to enhance inter-governmental collaboration, there is need to:
a) Jointly develop policies in the sectors of recurrent responsibility such as education, health etc.
b) Co-finance, jointly implement, monitor and evaluate projects located in a particular state in collaboration with the State government.
c) Strengthen disclosure and accountability arrangements in relation to how public money is spent, especially at state level.
d) Ensure fiscal and monetary policy synergy. CBN development finance Interventions should be done in collaboration with relevant government agencies. Also, there should be a standing fiscal and monetary policies coordinating committee

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16. Indeed, achieving socio-economic recovery and sustainability necessitates a collaborative effort involving the government, private sector, citizens, and civil society, including the media.
17. The media, especially GOCOP, should leverage the expanding internet penetration in Nigeria to continue playing its pivotal role by educating the public on the significance of government programs and policies. It should also actively promote good governance by holding the government accountable and reporting on instances of corruption and other forms of misconduct. Additionally, it can support businesses by promoting their products and services and highlighting the challenges they encounter.
18. In conclusion, I call upon all stakeholders to fulfill their roles in achieving socio-economic recovery and sustainability for Nigeria. The government should create an enabling environment for businesses to thrive, the private sector should invest in the productive sectors of the economy, and civil society should hold both the government and the private sector accountable.
19. Once again, I extend my appreciation to the organizers of this year’s conference for deeming me worthy to deliver this keynote.
20. Long live the Guild of Corporate Online Publishers, and long live the Federal Republic of Nigeria!