How Nigeria can leverage human capital development to halt poverty trend

…HCD is a necessity for Nigeria’s continued growth – Prof Banku Obi

…Investing in human capital greatest solution for prosperity of any nation – Prof. Tayo

The World Bank’s recent report states that about 97 of the over 200 million Nigerians now live below the poverty line due to the sluggish economic growth and the rising inflation.

The global bank noted that this slow growth has increased the country’s poverty level from 40 percent in 2018 to 46 percent in 2023, pushing an additional 24 million Nigerians below the national poverty line.

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The report further indicated that the number of poor Nigerians in urban areas that are more exposed to inflation increased from 13 million to 20 million, while the number of poor Nigerians in rural areas rose to 84 million from 67 million within the same period.

The World Bank’s development update for Nigeria, titled, ‘Turning the Corner: From Reforms & Renewed Hope, to Results,’ also indicated that the current reforms of President Bola Tinubu can reverse the poverty trend in the medium term through higher growth and lower inflation.

However, higher economic growth cannot be achieved without a deliberate investment in human capital development, which has been identified as the catalyst for bridging Nigeria’s poverty trajectory.

PricewaterhouseCoopers (PwC), a professional services firm, in its 2024 economic outlook for the country disclosed that Nigeria’s inflation will marginally decline. However, it also indicated that the ongoing Russia-Ukraine war and other external factors might fuel an upward swing.

The report projected Nigeria’s gross domestic product (GDP) will rise by 3.1 percent but that the poverty level in the country will increase to 38.8 percent, and further highlighted seven key trends that will shape the nation’s economic trajectory in 2024.

“Infrastructure funding may remain insufficient in 2024. The allocated infrastructure spending budget for 2024 is ₦1.32 trillion, falling short of both the World Bank’s suggested 70 percent infrastructure-to-GDP benchmark (currently at 30%) and the yearly $150 billion requirement specified in the National Integrated Infrastructure Master Plan for 2021- 2025,” the report said.

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According to PwC, Nigeria must balance ambition with budgetary implementation. Find the right framework, instruments to achieve price stability in the foreign exchange (FX) market. Improve sectoral development riding on reforms; Investor’s will be cautiously optimistic; Undulating pathways to unlocking productivity in the economy; Persisting vulnerability to external pressures with potential ‘shocks’, and that Consumers may likely adjust better to evolving policy and macro realities.

“Human capital, defined as the knowledge, skills, talents, and abilities of our citizens, is the true engine of economic growth, social progress, and national development,” said Florence Banku Obi, vice chancellor, University of Calabar, and guest speaker at the Bullion Lecture 2024, themed, Human Capital Development as Catalyst for Nigeria’s Prosperity.

According to her, human capital development (HCD) is about empowering people to reach their full potential, personally and professionally, thereby creating a workforce that is productive, innovative, and adaptable to change.

She said further that human capital development enhances and improves the skills, knowledge, abilities and overall potentials of individuals within a society or organisation. “When man is confronted with knowledge economy and technology economy, the most essential variable is the human capital,” she said.

According to Obi, Nigeria education is currently too rigid and conservative to influence the needed development drive. Hence, there is a need to review the national policy on education to make it functional, and re-evaluate the entire value-chain of the education system, especially the curriculum.

She said further that value reorientation is critical to human development; hence the need for the government to be intentional about creating solutions that embrace the setting up of vocational centres across the country.

Obi also suggested that the government should create an enabling environment for synergy between the business community, private sector and the academics. “Human capital development encompasses various activities aimed at improving human resources, such as education, training, mentorship, skill-building programmes and career development initiatives.”

Speaking further on steps that can be taken to leverage human capital as a catalyst for Nigeria’s prosperity, Obi said that oil has lost its place as Nigeria’s most valuable asset, which is why the government should make deliberate and intentional investment in Nigerians. “Human beings are the catalyst for Nigeria’s prosperity,” she said.

According to Obi, Nigeria boasts a young and vibrant population, a demographic dividend that can be a powerful asset. However, limited access to quality education, inadequate healthcare, and a skills gap between graduates and workforce needs, have perpetually hindered the country’s ability to fully harness their potential.

She said further that the path to Nigeria’s prosperity lies in the development of her human capital. But, disclosed that it will not be a quick-fix solution or a one-time investment, rather it will demand a sustained commitment to nurturing the potential of every Nigerian, regardless of their background or circumstances.

“It is a collective effort that requires collaboration between government, private sector, civil societies, and educational institutions. Together, we can build a Nigeria where every child has access to good education, every citizen can lead a healthy life, and every dreamer can achieve their aspirations.

“Human capital development is not a luxury; it’s a necessity for Nigeria’s continued growth and prosperity. By investing in our people, we invest in a brighter future for all,” Obi said.

Ademola Tayo, vice chancellor, Babcock University and chairman of the 2024 Bullion Lecture, said that the government must devote more resources to human capital development to bridge the current talent deficit.

According to him, investing in human capital is the sure route to prosperity of any nation. He said further that there was a positive correlation between a nation’s prosperity and human capital development.

Tayo also said that over the years, Nigeria has not fared well in human capital development and that Nigeria must embrace the knowledge economy by devoting a higher percentage of her annual budgets to education.

“I believe investing in people through health care, good nutrition, quality education, constant and consistent skills are crucial to ending extreme poverty in our land. We have to invest more in education, the training and retraining of our people so that they can acquire the necessary skills and competencies for technological development.

“We must be intentional and deliberate in restoring the social and economic fortune of our dear country. Thereby we will be able to address the challenges of food, security, and economic development,” Tayo said.

Ernest Ebi, chairman, Centre for Financial Journalism, earlier in his opening remarks, said that the Bullion Lecture series started in 2015 at a turning point in the political and economic life of the country.

According to him, the inaugural lecture took place at a time when the nation was transiting from one administration to another. He disclosed further that successive editions of the lecture series have addressed topical national issues and had pointed the way forward for the country.

In his vote of thanks, Ray Echebiri, CEO, Centre for Financial Journalism, convener of the Lecture, said he was thrilled by the large crowd. He thanked the keynote speaker and the chairman of the occasion, for finding time to make it to Lagos to share their thoughts with fellow Nigerians.

He expressed the optimism that the paper presented by the speaker would be useful for everyone who reads it, particularly, the nation’s policy makers.