Yemisi Izuora
Prof Uche Uwaleke, has said that Nigeria as a country need to proactively legislate and pursue critical policies that targets key sector development to support efforts towards economic recovery.
Uwaleke, stated that 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.
Uwaleke, who is Special Adviser to the Chairman Senate Committee On Capital Market and Institutions, while addressing the 7th Annual Conference of the Guild of Corporate Online Publishers (GOCOP), which held in Abuja, on October 5, 2023.
Protocols, themed, ‘Nigeria: Roadmap for Socio-Economic Recovery and Sustainability’. observed that though 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.
Dissecting the country’s economy and key challenges, he said, the country has been bedeviled by several challenges which have hampered socio-economic progress and sustainable development despite sitting on huge resources.
In particular, the last ten years have been characterized by weak economic growth, elevated inflation, high unemployment and rising poverty while 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, he recalled.
Unfortunately he noted that the rise in insecurity such as banditry and kidnapping, remains a grave concern, as does corruption just as poor access to quality education and healthcare equally became a major issue, together with the adverse effects of climate change, such as flooding and desertification.
He went on to say, “Although, Nigeria’s economy grew at a rate of 5.53 per cent 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 per cent 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).
“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.
“Inflation rates in the country have remained high, rising from 10.39% between 2010 and 2015 to 25.80 per cent 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.”
He however said that it is not all woes because on the positive side 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 per cent of the total population.
Supporting his analysis with figures, Uwaleke, said, “In early 2023, there were nearly 194 million active cellular mobile connections in Nigeria, equivalent to 87.7 per cent of the population. Moreover, over 31.6 million Nigerians engage with social media, accounting for 14.3 per cent 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.”
Also, on the positive side, he said, “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.”
But to sustain positive growth, Uwaleke, said efforts should be made to ensure Productive-Base Expansion/Diversification, by 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.
There should be policy that would support promotion of industrial parks and Privatization of state-owned businesses such as NNPCL through the capital market for inclusive economic growth, while encouraging regions and states to identify areas of competitive advantage and set parameters to become self-sufficient economically.
On Infrastructure Development, Uwaleke, called for substantial investments in infrastructure which he considered necessary to unlock economic potential.
Government he advised should facilitate private sector investment in the provision of key infrastructure: roads, railways, ports, energy. Breaking monopoly in the oil sector, rail transportation, power etc, while efforts should be geared towards exploring updating and facilitating implementation of Integrated Infrastructural Development Master Plan, explore innovative financing mechanisms such as asset securitization.
He spoke of investing 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, he proffered measures including free education up to senior secondary school, redesigning of 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, partner private sector for investment in vocational and technical Institutes and expand the National Health Insurance Scheme to accommodate those in the informal sector.