How do you get a young, tech-savvy population that is among the largest in the world productive and how do you ensure they contribute to a more diversified economy, boost growth rates, and reduce poverty are some of the questions that Nigeria’s next president must answer and quick.
Nigeria has a demographic advantage that some other countries would wish for, just ask Indonesia.
Indonesia is set to lose its title as the world’s fourth-most populous nation by 2045 amid slowing birth rates, according to the Indonesia Ministry of National Planning.
A recent survey the ministry conducted with the statistics agency indicates Indonesia’s population growth will slow to 0.4 percent in 2045, from 1.17 percent last year.
“Our population growth is slowing down every year,” said Suharso Monoarfa, Indonesia’s planning minister on Tuesday. “We should be able to recover from the pandemic and carry out the inclusive and sustainable economic transformation going forward.”
Nigeria on the other hand has no such problem with a youthful population that is the largest in the world.
At an annual growth rate of 2.5 percent, the United Nations forecasts that Nigeria is poised to displace the US and become the third most populous country in the world by 2050, after China and India.
This makes Nigeria a youthful population with a median age of about 18 years, which is lower than African and world estimates of 19 and 30 respectively.
While Indonesia has been able to use its young productive population to attain lower poverty rates, BusinessDay’s analysis and expert opinions show Nigeria is reaping nowhere near the full advantage of its demographic dividend, with the government barely investing in human capital.
“Nigeria is not reaping the benefits of its current population structure and must do more to mitigate the negatives. A large population of unskilled, economically unproductive, unhealthy and poorly educated young people is also a burden to society,” Akanni Akinyemi, professor of demography and social statistics at Obafemi Awolowo University said.
He added, “Nigeria has a relatively high and growing population of dependants. This could put a strain on those who provide for them. Young people account for a bigger share of the dependents.”
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According to a productivity index by Penn World Table (PWT), a set of national accounts data developed by scholars at the University of California, Nigeria’s population is the fourth least productive country in Africa.
The data showed Nigeria ranked lower compared to South Africa, Egypt, Kenya, Morocco, Algeria, Ethiopia, Ghana, Tanzania among others in the ranking of productive populations in Africa.
The PWT report which utilises the Index of Human Capital per person, a measure of the knowledge, skills, and experience possessed by a country’s workforce, to assess the productivity levels of different countries, showed South Africa had the highest human capital index score of 2.9 percent while Egypt and Mauritius were close behind with scores of 2.67 percent and 2.63 percent respectively.
Ghana, Algeria and Kenya also scored 2.53 percent, 2.38 percent and 2.35 percent respectively, while Nigeria, Morocco, Tanzania and Ethiopia had the least scores with 1.97 percent, 1.94 percent, 1.716 percent, and 1.46 percent respectively.
Economists said the above developments are an indication that the government needs to invest more in infrastructure to improve productivity and lower the cost of business as well as invest in education to give workers opportunities to upgrade their skills.
Bismarck Rewane, an economist and CEO of Financial Derivatives Ltd, said the government needs to invest in ventures that can help improve labour productivity and unlock the economy.
“Nigeria’s labour productivity is negative, the things government invest in must have a way of unlocking and accurately de-shackling Nigeria’s constrained economic output,” Rewane said.
Other experts say the government will splash jumbo packages on ex-governors in the form of pensions or burn billion naira monthly to keep petrol cheap, at a time of dwindling revenues, but not to develop its human capital.
“Nigeria has great potential as a nation for exporting brain capital. However, to achieve this, the country must focus on integrating its vast brain capital base into Global Value Chains to deliver high-value-added services and earn foreign exchange,” a report by PricewaterhouseCoopers (PwC) said.
It added, “When we look at the net oil performance side by side with remittances, we can see more clearly that Nigerian brains working in the diaspora contribute more to the economy than oil.”
PwC noted that brain capital is the fuel that powers economies.
“Technological advancements and global trends are changing how effectively this fuel can burn. Nigeria has quality brain capital to export to the global economy. Some of which the country already exports. Nigeria needs to re-strategise and implement policies that ensure it reaps the significant benefits locally,” PwC explained.