Long before President Goodluck Jonathan rang the closing bell of the New York Stock Exchange at the famous Wall Street on 23rd September 2013, I had noticed more frequent news coverage on Nigeria in the global media. Even on yahoo news, hardly any week passes by without reading something about Nigeria, ranging from the grim to the laughable. It’s like the world is saying, watch out this pregnant nation, we don’t know what it will deliver, but it’s gonna deliver something, soon.
Some economic analysts have, for some time now, been hawkish about Nigeria, plucking it out into newly emerging economic groupings such as MINT and PINE. Nigeria finally announced a new gross domestic product (GDP) of $510b on 6th April 2014 up from GDP of $290b, becoming the largest economy in Africa after overtaking South Africa’s GDP of $370b. Nigeria’s output has reportedly been experiencing a continual expansion of about 6.5% yearly over the past decade with a current population of 170 million, compared to South Africa with a 3% average annual growth rate and a population of 51 million. The new GDP figure was obtained by changing the base year from 1990 to 2013 for calculating its output to reflect newly emerged sectors of the economy such as telecoms, information technology, music, online sales, airlines, and film production. The figure instantly shrank Nigeria’s debt-to-GDP ratio from 19 percent for 2012 to 11 percent for 2013. In terms of per capita income, Nigeria's global ranking is still a grim 121.
The news on how Nigeria is exploding in economic prosperity has been a red herring to everyone. Aside from the GDP rebasing, nobody could finger any intelligent driver(s) for the economic growth other than high oil prices and a surging population of consumers. In the end, Nigerians may not feel any effect of this economic gymnastics on paper as according to 2010 World Bank estimates, 84% of the population are in strangulating poverty. 56% of the youths were out of work in 2010, according to official data. The World Bank’s most recent release listed Nigeria alongside four other countries in the world’s extreme poverty category. As expected, Nigeria via Ngozi Iweala immediately pooh-poohed the World Bank claim, assuring all that Nigeria is doing just fine. I bet it does.
Not surprising, Jonathan and many of our governors have been celebrating and owning the new country status, even though it only means the country is now more qualified to borrow more loans. The governors have been viciously elbowing themselves into foreign countries on investor hunting. They go, often as part of the usually oversize Jonathan’s foreign trip contingents, with neither economic development philosophy nor coherent speech, other than shamefaced begging of the host country’s business community. They are notorious for promising just about anything – CofO’ed land, security, oil lifting, etc - in exchange for establishing foreigner business, any business, in their state.
Some foreign interests with preference for the zero to semi-regulated business environment of Nigeria are responding to the calls. Nigeria is among few irregular countries where you can make the quickest kill turning over a N2m investment into N30m in just 5 years. So, as a potpourri of sleazy foreign direct investment (FDI) entities now tepidly enters Nigeria, the long presence of village-size Lebanese bloc in Nigeria is now being swelled by town-size communities of Chinese, Indians, Koreans, and a mixed bag of Europeans. Giant corporations such as Lenovo (laptop and smart phone), Nissan (auto) and Monsanto (GMO crops) are other FDI interests giddily waiting in the wings to come in. These opportunities should herald a new era of social development and people emancipation for Nigeria. But is it?
The way we are shoving Nigeria into modernity makes me want to climb the walls. It is beyond perplexing how our political class thinks it is making progress by bringing in external technology to civilize us before we civilize ourselves. Inviting investors into our land carte blanche and without readying ourselves for their technology will neither put us in a vantage position on any multilateral business contract nor liberate us from our culture of consumerism. The crude begging approach betrays a lack of in-house competence to receive the best intellectual property (IP) from anyone, it only places us in a position to be walked over by everyone at will like a rug in a lobby.
I don’t understand why Nigerians are disorganized and adorn short-range thinking. Why can’t all the almajiri governors operate from a single national FDI master plan? We have one, don’t we? Why are all the governors running around like drunken teenagers outdoing themselves on profligate projects when our state of readiness in the country for modern technology is pathetic? I bet I know the answer to my own questions. The Nigerian leadership crop most assuredly knows it too. Apart from being vacuous, the only other reason they are in the business of solo investor hunting is because it feeds their individual vanities and maximizes their capability for looting and laundering their loot.
Methinks the least a country purportedly on industrialization overdrive should have ready is electricity, for crying out loud. As it is, most of the country is in the dark at night and during the day, every day. Out of about 35,000 MW energy that we need to light our homes and power our industry, Nigeria generated less than 10 percent at 3,463MW up till 20th March 2014 when it dropped to the previous abysmal level of 2,500MW or 7 percent. According to our shameless government, this worsening of a dismal situation was due to “a significant drop in gas supply and a number of fire accidents along the Benin-Sapele highway.” What is the sense in pulling foreign investors by their lapel to come and industrialize us when we do not have electricity? This is why the 36 state governments each awards and re-awards power generating contracts in billions of Naira annually but without a kilowatt increase on our national grid.
Availability of raw materials in-house is another ingredient you think we might have given much thought to in our FDI stunt. I would be surprised if up to 10% of the raw materials needed for the current volume of business in the showroom of our airhead leaderships are being sourced in Nigeria today. Iron and steel for the machinery and automobile sector, petrochemicals for the pharmaceutical and construction sectors, mining and research and development activities that sustain operations and feed innovations in other sectors; how much of any of these do we currently have within our shores? Divesting our country to investors on a freehold arrangement that allows foreigners to repatriate enormous revenues that we could have earned on their raw materials is a slow and painful way to grow any economy.
What about technology transfer? I thought we would have a rigorous technology transfer program on hand before bringing in foreign investors to enslave our citizens on minimum wage jobs that pay neither for healthcare nor retirement benefits. Nigeria had nothing to show for the thousands of cars churned out of the assembly plants of Volkswagen and Peugeot for decades between the 70s and 90s. It is time for our economic development blueprint to be all about rapid IP acquisition. We cannot continue to play professional suckers to loveless foreign interests at the expense of our own future. We ought to be able to accomplish technology transfer of whatever business is brought in by any FDI arrangement within 5 years. Does Nigeria have a national technology transfer roadmap for use with the incoming Nissan, Lenovo, GE, Monsanto and the mixed bag of Chinese businesses already running loose in our nation? If we do, is any of our delusional wannabe hero governors aware of this?
What about the current deplorable state of the rule of law in our country? Do we have the right industrial laws for managing the new Nigeria that is rapidly becoming full of foreign overlords? Is our current law enforcement infrastructure adequate for the new age that we are entering? How capable is our Police institution? Have we thought about creating a special Police Unit to manage the new dispensation? As non-black foreigners come in with economic and entrepreneurial superiority, have we thought about readying ourselves for a new wave of racism that we have not experienced since the departure of the imperialists some 50 years ago? Already, sexual harassments and brutalization of Nigerians in new FDI companies are breaking out; at least two Nigerians have reportedly been killed with indignity by their FDI bosses. As we speak, neighborhood blocs are being bought out by foreigners and pretty soon, these will become no-go areas for Nigerians.
I am not saying that we should wait until we get all our ducks in a row before we begin developing Nigeria with willing FDI vendors. That logic ought not to be a justification for why we should have nothing ready at all. It would be costly or downright inefficient for one puny state to float its own silicon valley, alright? Governors from a group of like-minded states (even from different zones) could join together and develop a single blueprint for bringing in serious foreign investments into a mutually defined business protectorate where many currently unfavorable factors such as security, infrastructures, water, electricity, etc could be locked down.
We should not overlook our culture of corruption. It will be foolhardy to think that we can go anywhere without tethering our outlandish lifestyle of unparalleled barefaced looting and official incompetence. Most of the 36 states are not any more fiscally viable than our overworked one commodity economy. Many of the states are in debt up to their chins, some up to their eyeballs. Governors come and go and the states resort to selling their debts in bonds to raise more funds for looting. In November 2013, Lagos state issued a whopping N87.5b bond with a 13.5 percent coupon. Only the future inheritors of Nigeria would buy such junk bonds.
A state of catastrophe is what you would likely get if you turn any economy into a free for all market where players fly out more capitals than they fly in. Operating a disoriented national economic program side by side national stupidity, avarice, incompetence and Boko Haram is not the way to go. Future Nigerians will not lie on a bed of roses tomorrow, if we are thoughtlessly manufacturing mattresses of thorns today.
By Qansy Salako