It is in the best interest of all noble Nigerians that every administration must succeed. The current administration must however be constantly conscious that Nigerians sought for “A New Deal” that will strengthen Nigeria’s Human Development Index (HDI). The economic growth between 1999 and 2014 was riveted with vastly disparate income distribution that expanded Nigeria’s poverty gap. If the wealthy continue to get richer too rapidly; the demand for goods and services also increases exponentially. The rise in prices will then climb sharply beyond what majority of the citizens can afford, thereby creating demands for incessant wage increment from the organized labour.
Economic growth and political stability are deeply intertwined. Equally, the uncertainty associated with an unstable political environment may reduce investment and the pace of economic development. Change is nonetheless constant and always risky but necessary. It must however be adopted with fanatical discipline through respect for contracts, constitution, and inclusive governance. Besides, an elastic continuity mechanism is critical to repositioning of Nigeria economy to obtain impactful growth.
Higher rate of unemployment will breed insecurity in any society, adducing inequality of opportunities, it amplifies poverty and uncertainty. Nouriel Roubini, a renowned economist predicted the financial crisis that mystified the world in 2008; he warned that any economic model that does not properly address inequality will eventually face a crisis of legitimacy. Nigeria recorded an average of six percent annual economic growth between 1999-2014; a sterling performance considering global meltdown in Y2008 but wage employment is estimated to have dropped by over thirty percent within the same period (“Putting Nigeria to Work”, World Bank June, 2010). Thus, the most important infrastructural development in Nigeria should be human capital development as reiterated by Bill Gates recently.
The strong economic performance we experienced in the first 16 years of returning to democracy failed to improve our obnoxious human development index because government of the day neglected the much-needed human capital development that could have propelled Nigeria into a “Knowledge Economy”. Therefore, employers were not able to fill vacancies from the local workforce. These problems emanated from dysfunctional educational system that doesn’t connect with the current reality, hence Nigeria parade university graduates with distanced skill gaps to contemporary labor demand despite our youth’s inherent thirst for knowledge.
Evidently, citizens at the bottom of the pyramid are currently being fortified through copious social intervention programs with sincerity and efficiency to bridge the poverty gap, this is very praiseworthy.Most wealthy nations with sizeable middle-class still offers social welfare programs, The United States Government offers social programs such as Section 8 and Medicaid. In practice, the Section 8 Housing Choice Voucher program will pay the balance of a rent payment that exceeds 30% of a renter’s monthly income. This program in under the purview of U.S. Department of Housing and Urban Development
Medicaid is also a joint federal and state program that helps with medical costs for some people with limited income and resources. The health and social welfare system are also part of everyone’s life in Britain, it provides help for anyone who is raising a family or who is elderly, sick, disabled, unemployed, widowed or disadvantaged. In South Africa, South African Social Security Agency (SASSA) is a national agency of the government created in April 2005 in order to distribute social grants and reliefs to needy citizens.
However, there must be an entrenched mechanism to promote upward income mobility to sustain these types of programs. The United States Congress enacted Personal Responsibility and Work Opportunity Reconciliation Act of 1996. The bill was a cornerstone of the Republican Contract with America, and it is commonly called “Welfare-to-Work (WTW) Program”. It is a comprehensive Employment and Training Program designed to promote self-sufficiency, recipients are evaluated to determine the best course of action, options include immediate placement into a job, education, training program, or both. Therefore, recipients will not stay on welfare program for a lifetime.Nigeria social intervention programs introduced by the current administration must be straighten.Afterall; big businesses get bailed-out by federal government intermittently.
Conversely, we must methodically and committedly encourage Foreign Direct Investment (FDI) for infrastructures development, even at $200 per barrel of crude oil we cannot resolve our infrastructure deficits as necessary and swiftly without massive FDI injection. However, investors must have absolute confidence in policy stability and rationalcapital repatriation regime. A free market economy will help reduce unemployment sharply, investors and citizens can thrive boundlesslywith tiny government intervention; as long as the players adhere strictly to the established regulations.
Furthermore, we must massively and urgently amplify skill acquisitions for unemployed graduates inICT, Maritime, Heating Ventilation Air-Condition (HVAC), Marine Welding, High-tech Carpentry and Electrical Wiring concurrently. If properly executed, these field of trades could fill thousands of jobs that were hitherto filled by expatriates.Mostexpatriates’ technicians in the oil sector went to vocational schools in their native countries, and they earn average of $70,000 yearly working at Nigeria’s offshore oil-rigs.Meanwhile, Nigeria’smetallurgical, structural and mechanical graduate engineers roam around for years looking for job with archaic skills.
Thousands of unemployed graduate engineers should be deliberately and systematically trained for these types of jobswith guaranteed job placement or internship with private companies that has joint venture or partnerships arrangement with the government.
Research concerning expatriatetechnicians further took me to Maritime Industries Academy Foundation, a partner of Baltimore City Public Schools.This academy offers seagoing career training to high school students, a fresh high school graduates that finished from this academy earns $45,000 per year globally after graduating as a Seaman Recruit. Labor is an integral factor for localization of industry, but insufficientskilled workforce largely forced Multi-National Corporation (MNC) to import expatriates.
At this point in time, every state in Nigeria should be a massive construction sites and commodity exchange centers, the reduction in spending by the private sector must be offset by strategic stimulus spending by the government to boost economic activities.President Dwight Eisenhower of United States of America enacted National Interstate and Defense Highways Act of 1956which gave birth to America’s interstate highway system.This Act produced more than 41,000 miles highways that are still the bedrock of USA transportation system till today. Millions of jobs were created in the process, all states were connected to amplified commercial activities and exports.
Today, South Korea has become a knowledge economy and thus climb its way up the world economic ladder through education and development of her human capital. Samsung and LG products are now de-facto electronic gadgets around the globe surpassing Japan’s Panasonic and Phillips of Netherland in the past two decades. The oil industry which contributes about 11% to National GDP employs fewer Nigeria, it’s absolutely nonsensical. Substantial infrastructure upgrades, Business Process Management and Information Technology business enablement initiatives could generate approximately 2.6 million new direct and indirect jobs within the next 4 years; these are the areas that needed urgent and laser-focused attention.
The Republic of India also uses IT-Business Process Outsourcing (IT-BPO) exportsto amplify her economy.India is the top global sourcing destination for IT &Business Process Outsourcing (BPO), representing 55 percent of the world’s market share – an estimated market size of $154 billion in 2017, with IT-BPO exports accounting for $108 billion of total India revenues. Overall, IT-BPO accounts for 8.1 per cent of India’s GDP in the past 10 years and employs 3.7 million workers (NASSCOM, 2018a). The Republic of India and the Philippines have become the two largest destinations for BPO. Based on International Labor Organization Article (Lorenza Errighi, Sameer Khatiwada and Charles Bodwell, December 2016), BPO has become one of the most important global supply chains (GSCs) in the service category.
The industry according to quantifiable estimates could worth $310 billion in 2020, how much of these sums do we want in Nigeria? Our strategic plan should revisit and consider this opportunity.This is an opportunity on a platter of gold for Nigeria, tertiary institutions must however upgrade their Science, Technology, Engineering, and Mathematics (STEM) curriculum and employ lecturers with contemporary skills to actualize this goal rapidly. An American software and staff augmentation company called Andela is currently taking advantage of our few skilled youths in software programmingoutsourcing, but they can’t get enough skilled workers hence they’re expanding to East African countries.
We can accommodate 25 Andelas in Nigeria, but our people must be able to obtain advance skill cheaply and swiftly. Microsoft, EMC, Oracle and Cisco had to move their software development unit to India in early 2000s when United States Immigration restricted and prolonged working visas for expatriate workers. Many countries in Asia, North Africa and Middle East have developed BPO capabilities through indigenous firms with potential explosive growth in foreign earnings. Foreign firms are constantly looking for low-cost locations to outsource service delivery or manufacture goods.
TheNational Business and Technical Examinations Board (NABTECH) and Bank of Industry should make it a national emergency to financially empower, upgrade and license private non-degree seeking vocational education organizations to accelerate talent and technical skill acquisition for unemployed graduates that currently seeks job but with latent skills. Nigeria cannot afford to be on the wrong side of globalization as we did with industrialization, it will be a grave security danger if short and long and term strategies are not implemented swiftly to curb poverty.
Considering Nigeria’s youth population and natural resources, her GDP as of Y2014 could have been around $757 billion if strategic short-term economic policies and export diversification were judiciously implemented in the first16 years of our recent democracy. People must earn living wage and pay less for food and shelter to alleviate poverty, this by extension will reduce corruption. If the poor get so hungry to the extent of not being able to sleep at night, the rich shouldn’t ponder of having a siesta. The children begging for money or hawking on Victoria Island, Asokoro, Ikoyi, Ikeja, Lekki, and Maitama roads will co-habit with affluent children tomorrow. These young Nigerians are supposed to be our leaders of tomorrow but we’re failing these youths, they have become professional merchandise hawkers and beggars.
Meanwhile, their contemporaries are inundated with STEM education in Asians, USA, Europe and even some African countries. Now is the time to get aggressive and compassionate, giving high rate of unemployment and coupled with report released by the UN Department of Economic and Social Affairs that projected Nigeria population in excess of 300 million by Y2050. Thomas Stiglitz, a Nobel laureate Economist believes our choice is not between growth and fairness; with the right policies, we can choose both. Nigeria must invest heavily in her most priced asset-its people.
Macro trends and Nigeria National Petroleum Company (NNPC) both indicated that Nigeria recurrent marginal crude production cost in US Dollars per barrel of Deepwater and Onshore are $30 and $15 respectively, mean cost at $23 per barrel(August 16, 2017 Reuters). Clearly, we can train a single Nigerian in Software Programming or Cloud Computing with less than One Thousand Five Hundred ($1500) US Dollars within six months and with a potential annual income of Fifty-five Thousand dollars ($55,000) afterwards. This implies that we can give a Nigerian life-long career with just 65 barrels of crude oil, alternatively we can lend a Nigerian 65 barrels of crude with a repayment term of One-Year in exchange for life-long career.
Nigeria has been identified once again as part of the Next-11(Countries with high potential of becoming among world’s largest economies in the 21st century) by Jim O’Neill of Goldman Sachs who coined BRIC nations in 2001. However, this is not the first time that Nigeria has demonstrated such potentials. Most Tiger Cub economies (Indonesia, Malaysia, the Philippines, and Thailand)and Singaporehave recorded significant successes in the development of their economies since 1965 when they were at par or even behind Nigeria.
A platform that would give Nigerians “a new deal” is highly essential to our continued existence as a nation, the “New Deal” must however be swift and focused on Relief, Reengineering, and Reform. Relief for the unemployed, pensioners and the aged, reengineering of the economy through massive infrastructure enhancements, human capital development, energy optimization, strengthening of solid mineral and agriculture sectors, and reform of the judicial system to amplify accountability, respect for contracts and guarantee justice for all. Nigeria situation is no more a political calculation for anyone but for the sole survival of a nation.
Accordingly, it is highly imperative for the enlightened class or the mass-affluent to actively participate in the political process and serve as constructive pressure group to monitor development, economic growth, equal opportunity, and efficient justice systems. Thus, Nigeria of our dreams could be realized sooner rather than later to prevent Social-Economic Armageddon.
Hon. Abiola Bashir Are
Bashir Are is the former sole administrator, Lagos Island Local Government
