The usual suspects limiting Nigeria’s economic potentials have been reiterated in a report by the World Economic Forum (WEF), which highlighted limited infrastructure development, youth unemployment, insecurity, and governance issues as the bane of meaningful progress.
With the right leadership, however, the WEF dynamic briefing on Nigeria for November, asserts that the country’s economy can grow at a double-digit rate, putting it close to or among the 10 biggest economies in the world.
This is predicated on the provision of adequate infrastructure, which is attainable when the country has strategic, discerning, and purposeful leadership. Nigeria can also seize the opportunity to achieve significant, sustainable and inclusive economic growth.
The WEF briefing is based on the views of a wide range of experts from the World Economic Forum’s Expert Network and is curated in partnership with Franklin Nnaemeka Ngwu, Ndidi Nnoli-Edozien, and Olayinka David-West of the Lagos Business School.
“Without an improvement in basic infrastructure, it is difficult to see how the economy can meaningfully, sustainably and inclusively grow. It cannot also be dissociated from other socio-economic problems such as unemployment, insecurity, recession and inflation confronting the economy,” noted WEF in the report.
The fragile security situation across the country also makes it difficult to achieve the desired economic growth to transform the standards of living, as investors find it too risky to bet on the safety of their resources.
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WEF stated, “Even with the curtailment of the deadly Boko Haram terrorist group, the violent activities of other ethnic militant groups and related criminal activities such as kidnapping, armed robbery and marauding Fulani herdsmen continue to pose serious socio-economic and political threats to Nigeria.
“Outside Boko Haram, the activities of the Niger Delta militants and Fulani herdsmen pose the greatest challenge to Nigeria’s unity and economy due to their impacts on two main sub-sectors of the economy: oil and gas, and agriculture.
“As Nigeria depends on revenue from the oil and gas sectors, the activities of the Niger Delta militants like bombing and destruction of oil pipelines and facilities have had very negative impacts on revenue generation and governance in Nigeria.”
In the area of infrastructure, the report indicated that over 70 percent of the 200,000 kilometres of national road network was in poor condition as of 2012. At present, not much has changed. The rail network, which would have been a fast and cheap way of moving goods and people in higher volumes has also been struggling to function. Little has been done to improve on the 3,505 kilometres of railway inherited from the British at independence.
Without a functional transportation network, it becomes a logistical nightmare for businesses, many of which may cave in under the pressure and collapse.
The perennially discussed epileptic power supply is also not left out, as according to the report, Sunday Oduntan, executive director, Association of Nigerian Electricity Distribution Companies (ANED), had said, “Nigeria generates and distributes only about 4,000 megawatts of the 160,000 megawatts required to power the country.”
Every aspect of infrastructure is deficient, from roads, to railways and energy, and every other sector. In the absence of these, the economy simply will not grow, unless there is political leadership with the will and competence to provide the required fixes.
Good Governance also appears to be lacking both in politics and business, yet critical, if Nigeria would navigate through the turbulent period of economic uncertainty.
While the report noted that “the government elected in 2015 has prioritised the fight against corruption and successfully curbed government spending. However, it has struggled to deliver the economic reforms required to stimulate investment and growth.” It reiterates the importance of good governance to Nigeria’s future economic prosperity and stability.
WEF further highlighted Nigeria’s consistently poor performance in the World Bank Governance reports from 1996-2015, in all of the good governance variables. These include rule of law, regulatory quality, government effectiveness, control of corruption, voice and accountability, political stability and absence of violence.
In the 2017 World Bank Doing Business report, Nigeria ranked 169th of the 190 countries surveyed. The country receives the same poor result in other global surveys. While the GDP per capita remains very low at about $3000, Nigeria is still perceived as a corrupt country, affirmed by its position of 136th of the 176 countries evaluated by Transparency International’s Corruption Perceptions Index in 2016.
As the ability of the government to address the governance issues is also related to the provision of inclusive growth and prosperity, security and job creation, investment in infrastructure and human capital, reforms to address governance challenges are most pertinent.
