• Wednesday, May 29, 2024
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BusinessDay

At 60, Nigeria still struggles to justify ‘giant’ status

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The year of Africa as it was called, Nigeria was not the only African country that attained independence in 1960, but one of 17 countries that secured freedom from erstwhile colonial rulers over the course of that year.

The other African countries that got independence in 1960 were Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Congo, Democratic Republic of Congo, Republic of the Congo, Cote d’Ivoire, Gabon, Madagascar, Mali, Mauritania, Niger, Senegal, Somalia, and Togo. Outside Africa, one other country, Cyprus, also got its independence in 1960.

Nigeria’s large population was supposed to help propel it to greater heights, but while the economic growth rate in the other countries has been higher than the population growth rate, the reverse is the case in Nigeria.

From recording an annual GDP growth rate of 25 percent in 1970, a decade after independence, Nigeria’s economy as of 2019, only grew at 2.2 percent, and by the end of 2020 is predicted to relapse into its second recession within a five-year period.

The pomp and pageantry that accompanied Nigeria’s independence celebration were for many at the time, in commemoration of the country’s potentials that were assumedly under-utilised during colonial rule.

At 910,770 square kilometres out of which Agricultural land is 610,304 square kilometres, representing 67 percent of the total landmass, Nigeria’s potentials spanned from agriculture, the economic mainstay at the time, to human resources due to population, and other untapped natural resources.

While Nigeria’s land area places it 6th after Democratic Republic of Congo, Niger, Chad, Mali, and Mauritania, it has more agricultural land than any of the other countries. Today, with barely half of its agricultural land put to use, Nigeria remains largely unable to ensure food security, having 86.4 million people facing moderate or severe food insecurity according to this year’s State of Food Security and Nutrition in the World report.

Considering Nigeria’s size in all ramifications, BusinessDay analysis of several economic indices between 1960 and 2019, through data mined from archives of the World Bank shows the country has not grown commensurate with its assumed potentials since 1960, particularly when compared with the other countries that embarked on their nationhood journeys around the same time. Data comparisons are done between 1960 and the most recent year with available data, either 2018 or 2019. Where data was unavailable for 1960, it is picked from 1970, a decade after.

At independence in 1960, Life Expectancy at birth in Nigeria was 36 years, a figure that ranked it 12th among 17 other African countries that got independence the same year. 60 years later, Life expectancy in Nigeria has increased to 54 years, but the country now ranks 15th, ahead of only Chad and Central African Republic. Senegal with 67 years now tops in Life Expectancy at Birth, followed by Madagascar and Gabon with 66 years.

Nigeria in 1960 had a population of 45 million people, the highest not just among the ‘class of 1960’ but across the continent. The population has now ballooned to 200 million as of 2019. As of 2019, the country had a population growth rate of 2.56 percent, whereas the economy is growing at 2.2 percent.

With the exception of The Republic of Congo with a contracted economy, Nigeria is the only one among the 17 countries, whose population is growing faster than its economy.

At independence, Nigeria’s GDP of $4.1 billion put it ahead of others, growing over the decades to remain at the top of the list with a GDP of $448 billion by 2019, which may not be surprising considering the country’s population over time, and exploration of other sectors beyond agriculture, notably crude oil.

As 1960 was the base year, there was no data available to show the GDP growth, so we start from 1970, a decade after independence and Nigeria was blazing the trail with an annual GDP growth rate of 25 percent, followed a distant second by Mauritania with a growth rate of 11.98 percent and Cote D’Ivoire with 10.37 percent.

By 2019, Nigeria’s annual GDP growth rate had slowed to 2.2 percent, placing it in 16th position at the far bottom of the table, only ahead of The Republic of Congo. There was no data for Somalia.

At 60, Nigeria still struggles to justify ‘giant’ status
GDP growth overtime between Nigeria and other countries

Among the ‘class of 1960’, The Republic of Benin as of 2019 now leads in annual GDP growth rate with 6.86 percent, followed by Cote D’Ivoire and Mauritania, with 6.85 percent and 5.93 percent respectively. These last two countries were the same that followed Nigeria in 1970, except they have swapped positions on the table.

Among the 17 countries, Nigeria has the highest inflation rate with 11.39 percent in 2019, while Burkina Faso has the lowest inflation rate, with -3.23 percent in 2019.

Interestingly, both Nigeria and Burkina Faso are the only countries that had data for 1960 available, and while Burkina Faso’s inflation has declined from 7.78 percent in 1960 (to its current state), Nigeria has seen inflation increase from 5.44 percent in 1960 to 11.39 percent in 2019 and predicted to increase further in 2020.

Nigeria had a history of an economy driven by its agricultural output and in 1962, food exports as a percentage of merchandise exports accounted for 64.52 percent but by 2018 had crashed to 1.95 percent.

In terms of Foreign Direct Investment, net inflows as a percentage of GDP, in 1970, a decade after independence and available data, Nigeria ranked 4th with 1.63 percent.

By 2018, Nigeria had dropped to 15th place, with FDI inflows now 0.5 percent of GDP, only ahead of Togo with a negative growth of 3.3 percent, and Somalia with no available data.

In dollar value, The Republic of Congo was 1st with $4.3 billion, while Nigeria followed with $1.9 billion, Democratic Republic of Congo (DRC) with $1.2 billion, Senegal $847 million, and Gabon with $845 million. Yet, Nigeria’s GDP is more than all the other countries combined, even in excess of $150 billion.

In terms of Net trade in goods and services (BoP, current US$), Nigeria has the largest trade deficit and sits at the bottom of the table with -$5.59 billion as of 2018. However, it should be noted that with the exception of Cote D’ivoire, all the other countries have trade deficits while data was unavailable for CAR, Chad, Congo, Gabon, and Somalia.

In Ease of Doing Business score, Nigeria ranks 4th on the list, with a score of 56.87, coming after Senegal, Cote D’Ivoire and Togo. Following Nigeria in 5th position is Niger Republic with a score of 56.75.

Nigeria has not fallen back in all indicators over the years, either making measured growth in some instances. In 1960, Senegal had the highest GDP per capita with $312, followed by Gabon, DRC, and Cote D’Ivoire while Nigeria with $92 trailed it in 11th position (excluding Mali and Mauritania with no data).

By 2019, Gabon had the highest GDP per capita at $7,667, followed by Cote D’Ivoire with $2,286 and Nigeria in 3rd position with $2,229. Senegal had dropped to 7th position, with per capita GDP of $1,446.

Also, Nigeria had the lowest food imports in 1970 (when data was available following 1960), with 8.24 percent when represented as a percentage of merchandise imports. While the country’s food imports had increased to 10.9 percent in 2018, it remained the lowest among the 17 countries, a positive outcome no doubt.

At 60, Nigeria still struggles to justify ‘giant’ status
Food exports between Nigeria and peers

In comparing Nigeria’s growth over the decades with that of other countries that attained independence in the same year, it is hard to refer to the country as a giant, much less, that of Africa. The country’s economy has grown, its population has grown, but the quality of life when viewed from the prism of diverse economic indicators has not improved correspondingly. The large population and resources have not turned Africa’s most populous nation into the land of prosperity the world expected it to become at independence.