Construction industry and the Nigerian economy

The Nigerian economy has in the past few weeks experienced some serious bashing. This, according to those in charge of the economy, is caused by the recent fall in the demand for crude oil which has led to drastic fall in prices of the commodity. Crude oil, as we know, is the oil fuelling the lantern of the Nigerian economy, so the fall in its price has a direct impact on the economy.

The government immediately took drastic actions to remedy the “unforeseen” situation by introducing several contractionary policies, which include cutting government spending (austerity measures) and devaluation of the naira.

The Nigerian construction industry thrives on government spending and commands the movement of enormous foreign exchange. So these measures would in no small measure naturally affect the construction industry. These realities are so glaring because over the years, the industry has been left at the mercy of foreigners. It has become almost impossible to carry out any meaningful construction project without importing most of the materials to be used. As a matter of fact, nowadays it is a symbol of status to brag that all materials used to construct a project were imported except for the water and sand and, who knows, that could also be a good source of importing business for some people someday.

The irony of the whole matter is that what should be feeding is now being fed. The construction industry of any country should be the most vibrant and independent because the industry builds and constructs the economy in the real sense of it. There should never be a time where things become so bad that we discourage construction except in a full-blown war situation. If the Nigerian construction industry were to have come to full maturity, the unemployment issues we have would not be this serious; what we would have been dealing with at worst would be seasonal unemployment during the rainy season because of the slow pace of construction in this period. A single 15-storey building project can provide jobs for at least 500 people directly or indirectly.

In Nigeria, we now have foreigners working as even bricklayers on construction projects. To further add salt to injury, many Grade A contractors now have the guts to price for projects in our own land using other countries’ currencies.

Just some few years back, our major challenge was to become cement sufficient. We were able to overcome this challenge conveniently in less than 10 years and in the process producing the richest man in Africa and the richest black man in the world. If this is not enough reason to convince us that construction in Nigeria has a great future, then I don’t know what else would do.

Countries like Germany, the USA, Japan, to mention a few, have built their economies with massive drive by the construction industry and developing other industries while doing this. In the USA, the hunger for construction became so much that they had to start creating communities in just a building, inventing what we now know as skyscrapers. This singular act of courage opened the way for the steel industry and other allied industries that have made these countries what they are today.

In recent history, countries like the United Arab Emirates (UAE), having seen into the future that a day would come that the world might get tired of oil or their reserves would run dry, whichever comes first, decided to put their eggs in the right basket and create a massive construction drive forcing the entire nation into ambitious construction projects and in the process built up several new industries, especially the tourism industry. This does not sound like rocket science to me. You don’t have to be Adam Smith to observe this trend in national development. It has happened in Chairman Mau’s China, in present-day Malaysia and Singapore, and it is happening aggressively right now everywhere in the Middle East which has the largest deposit of oil.

Nigeria on the other side of the continent amazingly has not even noticed the possibility of this happening. Recent happenings, however, have shown us that we have just succeeded over the years in boxing ourselves to a corner.

The good news is that it’s never too late to construct as long as water and sand remain on earth. The only thing needed is a massive drive. Our government is showing signs of seriousness in this aspect already. The launch of the Centenary City initiative shows that at least we know what to do. This, however, is just a sign; there are still several underdeveloped lands in the country. We need a construction drive, driven fully by a trained army of Nigerian construction workers. We need spikes and hikes in government attention to the construction industry. If we start with construction, it would filter down to other industries.

Laja Fanimokun