The Nigerians’ New Round Of Economic Pang

February 27, 2024
Nigeria Economy challenges

By Jerome-Mario Utomi

This piece stemmed from three different but related sources. The first has to do with the astronomical increase in the prices of goods and services in Nigeria, a country that is still discussing minimum wage at a time when the global community is focusing on living wage. And a nation where everything heads up except the wages and salaries of workers, particularly the civil servants.

The second has to do with the Global Trends in Child Monetary Poverty report recently released by the World Bank, which reportedly stated that 40 million Nigerian children are living in extremely poor households and families.

The world financial body, according to media reports, clearly stated that; “In absolute numbers, most children living in extreme poverty live in middle-income countries, 179.4 million children (14.9 per cent in lower middle and 2.2 per cent in upper middle income in extreme poverty) – including 52.2 million children in India (11.5 per cent) and 40 million children in Nigeria (37.9 per cent) living in extremely poor households.”

The third and very key was my recent conversation with one well-informed and development-minded Nigerian resident in the United States of America (USA). Through my conversation with him, he lamented bitterly about the current economic situation in the country. To register his total displeasure, he thus remarked; that this country has become a failed nation. Worried by his submission, I queried; what are the indicators of your claim?

And just immediately, he responded; the indices are the teaming jobless and frustrated Nigerian youths migrating to Libya in search of greener pastures. How will Nigerians be migrating to Libya? Libya is a war zone, the home of human trafficking. Another index is the Niger Delta region which has been persistently denied development. What about the substantial number of the Nigerian population that now goes to bed without food? I am a living witness.

There is this young girl who worked with me in Nigeria. She called me recently and told me how bad things were that she had not eaten for two days. She needs only 2,000 naira. There was another one, a single mother of two who once sold her television to buy food for her sons. What could have caused that? And yet you see politicians in Nigeria living above their means. We heard of the one discussing money that they shared not knowing he was on record while making that very costly statement. They now joke with the poor at the national assembly. Is that not pathetic? Nigerians are dying. There are no hospitals for them. Their educational system is nothing to write home about. Everything is gone. Are you looking for more indicators?

Continuing, he said; going back to palliatives, during the COVID-19 era, I received up to twenty thousand dollars ($20,000) from the US government. Quote me. I did not apply for it, I did not ask anybody for it, and I did not line up for it. Many Nigerians who are currently residing here received that money and there was food everywhere. They had food distribution centres. You now see why Americans would want to fight for their country’s rights. They go around to get information from other countries and bring it back to develop their place. Yes, that is a country. Nigeria on the contrary has become a political geography whose economic power has become so weak and too fragile that even its citizens have no trust in it as it can no longer support their life chances. This is the simplest characteristic of a failed state.

“Do you need further evidence?” he queried.

On the way forward, he captures it this way; for our country to develop, we have to free it from the current crop of leadership structure surrounding it, we have to push our survival instinct aside, we have to set our regional considerations aside, we need to push politics aside to save this country. We are endowed with everything. We have no right to be where we are now, he concluded.

Even as I struggled not to agree or internalize his thoughts on the state of the nation Nigeria, I, at about the same time recalled that a similar fear was raised about 2 years ago by a former United States Ambassador to Nigeria, John Campbell, and a former Director with Harvard University’s Kennedy School of Government, Prof. Robert Rotberg. The duo reportedly said it is time for the US to acknowledge that Nigeria is a failed state in the light of the many challenges plaguing the country.

Campbell and Rotberg said this in an article titled, ‘The Giant of Africa is Failing’ which was published in the May/June edition of ‘Foreign Affairs’ magazine. They argued that every part of Nigeria now faces insecurity which threatens the nation’s corporate existence.

The article read in part, “Nigeria’s worldwide companions, particularly the USA, should acknowledge that Nigeria is now a failed state. In recognition of that truth, they need to deepen their engagement with the nation and search to carry the present administration accountable for its failures, while additionally working with it to supply safety and proper financial system.”

“Some overlapping safety crises have remodelled Nigeria from a weak state right into a failed one. Buhari’s authorities have struggled to quell numerous Jihadi insurgencies, together with the one waged by the militant group Boko Haram,” the article read. Campbell and Rotberg said the Federal Government seemed to have given up in some areas because non-state actors had taken over while quasi-police organisations and militias controlled by state governments had become more common, clearly, a bracing account.

But for me, while this piece provides too short a space to explain why the description of Nigeria as a failed political space shall remain an unending commentary, it is however, spaced enough to state that such conversations are strong indications that the nation’s challenge is predicated on inadequacies of, and failure by public office holders to generate breakthrough ideas and exacerbated by comprehensive incompetence to learn what the job of leadership is all about.

Also contributing to the frequency of this ‘topic’ is the recurrent total absence of creative/innovative thinking and superior leadership communication compounded by a lack of political will on the part of the elected officials to domesticate leadership lessons learned abroad.

Take as an illustration, considering the slow-growing economy but scary unemployment levels in the country, the current administration in my opinion will continue to find itself faced with difficulty accelerating the economic life cycle of the nation until they contemplate industrialization, or productive collaboration with private organizations that have surplus capital to create employment.

To achieve such a feat, power (electricity) and other infrastructure – roads need to be addressed. Notably, not doing any of this, or continuing on the low growth of the economy will amplify the painful consequence of strategic mistakes made by previous administrations in the country that failed to invest during the period of rapid economic growth.

The question that is as important as the piece itself is; what is the Federal Government currently doing to sustainably solve these challenges that currently and frequently make the global community perceive us as a failed state? In my view, the nation has to find a solution and fast to these challenges because history teaches that democracy needs economic development, literacy, a growing middle class, and political institutions that support citizens with a favourable economic environment to survive.

This leads to another set of sad narratives. Presently, Nigeria is a country that services its debt with over 75 per cent of its annual revenue. We don’t need to be economists to know that we have become high-risk borrowers.

Even more damaging is the awareness that the country, going by reports, would be facing another round of fiscal headwinds. This challenge stems from the country’s revenue crisis, which has remained unabating in the last years, while the borrowings have persisted, an indication that the economy has been primed for recurring tough outcomes.

Indeed, the question may be asked why the country’s revenue crisis remained unabated in the last five years.

Also creating the failure narrative is the fundamental recognition that here is a country reputed for crude oil dependence and laced with a management system devoid of accountability, transparency and accuracy. Before a real solution can be proffered, we need as a nation to find and understand the sources of the national problems without losing sight of the real and lasting meaning wrapped in the lesson.

Without a doubt, what the above tells us as a country is that there is more work to be done, and more reforms to be made; that as a nation, we are poor not because of our geographical location or due to the absence of mineral/natural resources but because our leaders fail to take decisions that engineer prosperity. And we cannot solve our socio-economic challenges with the same thinking we used when we created it’.

This piece may not unfold completely the answers to these challenges, but there are a few sectors that a nation desirous of development can start from. And the first that comes to mind is the urgent need for diversification of the nation’s revenue sources. Revenue diversification from what development experts are saying will provide options for the nation to reduce financial risks and increase national economic stability: As a decline in a particular revenue source might be offset by an increase in other revenue sources.

God Bless Nigeria!!!

Utomi Jerome-Mario is the Programme Coordinator for Media and Public Policy at the Social and Economic Justice Advocacy (SEJA), a Lagos-based Non-Governmental Organization (NGO). He can be reached via [email protected]/08032725374

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