Friday, January 13, 2012

Thinking of a Nigeria without oil

Easy oil wealth is the grease that runs corruption and low national productivity in Nigeria . Any rise in the price of crude oil in the international market or removal of fuel subsidy will bring more monies to all the three tiers of government in Nigeria , thus, more corruption and increased poor creativity in the revenue-generation at federal, states and local government levels? 
Easy oil money has confused and turned Nigerian leaders into wasteful spenders; it has turned men that society trust into men with low political and moral values, it has also helped in the distortion of Nigeria ’s federal system.  Could have Nigeria been better-off without easy oil money?  Or is it a “curse” that Nigeria and Nigerians have to live with, and life goes on? Pessimists are of the view that Nigeria has already missed the opportunities to utilized oil monies  for national development- they argue that, Nigeria’s leaders, without any remorse has been eating up the  ‘future’ of the next generations. However, optimists are of the view that, the country still has chances to amend the mistakes of the past and take a cue from other nations.
Here is the big question- which of the two is the biggest challenge for Nigeria ? – is it the country’s heavy dependence on crude oil as the major  source of revenue; or the massive corruption in the country  triggered by the availability of easy petro-dollars, including the shady management of the now  controversial fuel subsidy regime?
There is no doubt that corruption is the monster subjecting most Nigerians to life full of pains. However, Nigeria’s sole dependence on oil as its major source of revenue and the only business that makes billionaires overnight is of greater harm- because it has promoted lack of creativity in revenue generation at all the levels of government; it is killing human capital development efforts and promoting laziness in the Nigerian society, in addition to making Nigeria’s political leadership indifferent to the plight of Nigerians either intentional or unintentional. 
It is indeed true that corruption facilitated by easy oil money has polluted the minds of  many Nigerians to the extent that the quest to hold political position or be close to the corridors of power is mainly use as an avenue to get rich. However, Nigeria ’s sole dependence on oil has promoted poverty of new ideas on governance and makes Nigeria vulnerable to any slight change in other country’s economy. 
The assertions that oil money has promoted corruption and lack of creativity in developing other avenues for revenue generation is not new, it is indeed yesterday’s news. But the current challenge is, when will  Government at all levels start to see oil money as a mere temporary ‘stipend’ that would one day disappears. For instance, the much hullabaloo by the Federal government and the Governor’s forum on the removal of fuel subsidy as the only avenue for government to get more revenue is clearly an end result of the continuing lack of feasible initiatives and creativity by government at all levels to create new ways of getting revenue apart from that of oil’s. 
Time has indeed come for Nigeria to invent new ways to get more revenue from other sources. The new ways has to be original and one which will well suit the peculiarity of the Nigerian state and its people. Though, it may contain some little elements of successful initiatives of other nations. One of the greatest mistakes policy makers in Nigeria do is- they often forget that any policy or programme that will drain the pockets of the populace; will face strong public resentment nonetheless the amount of revenue it would generate for government. That is why the removal of the fuel subsidy triggered nationwide public protests.  So, Nigeria ’s revenues generation drives (either subsidy removal or any other) must be synchronize with believable models that will create an enabling environment and uplift citizens’ living standard as well as provide ways to assist them turn their dreams into reality.
Nigeria’s leaders, policy formulators and implementers should develop a new revenue generation model, whereby the country  should  systemically and systematically reduce cost of governance, reinvigorate  her agricultural sector, promote small scale industrialisation;  develop human capital and efficient taxation, duties/tariffs, licenses and fees collection system.That is, putting in place a process through which the country’s economy can be transformed, and placing the country in a position that her citizens can take advantage of the vast opportunities today’s world economy offers.
It is good that President Goodluck Jonathan has started the process of cutting government’s recurrent expenditure. It must be transparent and seen to be implemented by all officials of governments from federal, states and local government levels.
Nigeria should redefine the implementation strategies of her agricultural programmes and policies. The development of the agriculture sector is imperative for Nigeria to remain economically viable. The new agricultural approach should not deviate from government’s current agricultural goals of alleviating poverty and hunger, promoting sustainable agricultural development, improved nutrition and food security, but the programme should also imbibe an all inclusive participatory techniques- where youth, communities, local councils, states, the federal government and the private sector (financial institute and private inventors) will be active and major participants. Financial institution and private investors shall be the financiers; governments at all levels will have well-defined roles, while the youths and communities shall be the targets. In addition, the programme should be designed to be in four categories- ‘export oriented’, ‘large’, ‘medium’ and ‘small’ scales.
Small scale industrialisation is another way government can generate revenues as well as increase the purchasing power of the poor. Though Industrialisation entailed both technology and profound social development, Nigeria can develop a small scale industrialisation programme which will steer resources into the productive process. Nigeria can tie her small scale industrialisation to agricultural output in the country. Nigeria has a total area of 910,768 km² of arable land, 13,000 km² water; and twenty-one (21) agricultural institutions, in addition to generation millions of tons of recyclable wastes every day. This will help in sustaining and developing the agricultural sector, boost export of finished or semi-finished goods as well as reduce unnecessary importation of items like razor blades, pine needles, envelopes, keys and padlocks, cotton buds, toys, shoelaces, safety matches umbrellas, doormats, office square clips, treasury tags, table flags,  carpets etc . Most of these items are produced from agricultural outputs and recyclables wastes by small industries setup with small amount of capital and powered by solar panels or small wind turbines. Most of these industries are owned and run by a family of two or three in Shanghai , Taipei , Manila or Bombay . If properly modelled, small scale industrialisation can bring more revenue to government and lift thousands of people from the bottom ladder of poverty. For example, The Bank of Industry, the Central bank of Nigeria , NAPEP and the ministry of Trade and Investment should ensure that Nigerian small-scale industries and interested individuals have easy access to intervention funds and soft loans.
Human capital development has played a vital role that has led to significant socio-economic progress and improvement in the lives of large number of people in many countries, noteworthy is the rapid and long sustainable high growth performances of East Asian economies. Nigeria can utilise her human capital for economic development. Though, economists are of the view that, for human capital to spawn a perceptible impact on economic development, a nation needs to have a minimum of at least 70 per cent literate population. Though Nigeria ’s literacy level is low, but Nigerians are a very creative and dynamic people. Despite the absence of strong formal support, Nigerians have made sport, music, art, Information technology and the film industries promising. Nigerian government can take advantage of this and use these industries to create jobs and generate wealth, by hunting for top quality talented Nigerians, provide them with world–class training.  In addition to assisting private entrepreneurs to establish well-equipped record companies, modern film studios, sport development enterprises and remove every obstacle that hampers the flourishing of these industries.   
Nigeria’s government and Nigerians place more emphasis on oil as the major source of revenue and the only lifeline of the nation- this has led to poverty of ideas in revenues generation, laziness, corruption and widening inequality in the society. Easy oil money has taken over the once creative, industrious, upright, competitive and gallant Nigerian society.  Let’s start thinking of a Nigeria without oil.
Zayyad I. Muhammad writes from Jimeta, Adamawa State,, 08036070980.

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