Nigeria’s economic hardship predates President Bola Ahmed Tinubu’s administration, but it has worsened since his inaugural speech, where he declared, “Subsidy is gone.” Following this announcement, the naira’s value depreciated, with the Central Bank of Nigeria (CBN) stating that the currency’s appreciation would be determined by market forces, marking an end to government interference.
The price of Petroleum Motor Spirit (PMS) initially increased to ₦470-₦550 in some states, particularly in the far north. Months later, another price hike was witnessed, jumping to₦1,050, signalling the end of government regulations in the petroleum industry.
These changes have severely impacted Nigerians’ living conditions and significantly reduced their purchasing power. Prices of food items, electronics, and virtually everything have skyrocketed, with some increasing by as much as five times.
The Nigerian Labour Congress (NLC), which some allege is under government control, threatened to embark on a strike and eventually called it off after securing a₦70,000 minimum wage agreement with the government. However, this amount can barely buy a bag of rice, considering the high cost of transport fares and food items.
In fact, experts argue that this meagre compensation is not a living wage and is rendered useless given the current economic conditions.
Nigeria’s economic situation has worsened, prompting multinationals to exit the country. Pick n Pay is the latest in a string of multinationals pulling out. This development is disturbing and scary. It’s imperative that economic managers take decisive action to address the situation.
The economic downturn has made many essential items unaffordable for Nigerians. Energy security is critical to national development, but filling stations are becoming deserted as the middle class abandons their cars due to skyrocketing PMS prices. Consequently, the number of private cars on the roads has significantly decreased.
According to World Bank statistics, 4 million Nigerians slipped into poverty in H1 2023, with 7.1 million more at risk. This alarming figure highlights the economy’s mismanagement. A responsible government would promptly respond to citizens’ concerns.
The North has suffered from darkness for over a week, resulting in trillions of Naira in losses for businesses. In a functional system, those responsible would face consequences. Unfortunately, no one has been held accountable.
Nigeria’s struggles stem from corruption and misgovernance. The PMS subsidy removal has exacerbated the pain without adequate support to cushion the effect. The government’s primary constitutional responsibility is to protect and improve the welfare of its citizens.
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Food insecurity and energy instability are key drivers pushing people into poverty and crime. To address energy security, we should consider decentralising the power grid, enabling states to build independent power plants. Emulating the governor of Niger State’s agricultural revolution can also serve as a model.
Additionally, making fertilisers affordable for farmers is crucial. This can be achieved by attracting investors to establish fertiliser manufacturing plants in every sub-region.
As the world transitions to a green energy revolution, solar power holds the key. The government should incentivise local and foreign solar manufacturers with favourable taxes and a conducive environment.
Energy stability is a critical driver for economic growth. Therefore, the government must take a holistic and critical look at the sector to genuinely support the country’s development.
Governance is not for the faint of heart or the feeble-minded. Honesty and trustworthiness are essential, but they are not the only requirements. Effective governance demands much more. Strategic thinking, creativity, selfless teamwork, critical thinking, and problem-solving skills are crucial.
State governors must think outside the box to boost their internal revenue generation. Each state has its own unique peculiarities and potential to become prosperous if it leverages its strengths. The United Arab Emirates (UAE), a once-barren desert, has become a model in the Middle East.
The UAE’s success can be attributed to investments in human capital, tourism, and accelerator programmes supporting startups.
We must resist foreign pressure and diversify our foreign exchange reserves to include the Yuan. China is one of our major trade partners. Once we diversify our reserve basket, we can purchase goods from China using the Chinese Yuan, thereby reducing our dependence on the US dollar.
Furthermore, promoting intra-African trade is crucial. This involves fostering trade between African countries, similar to the European Union’s model, where a single currency, the Euro, facilitates transactions. Nigeria is well-positioned to champion this initiative.
In conclusion, my parting words are: Nigeria is undisputedly Africa’s behemoth. However, a country’s size or population does not determine its economic growth; rather, it is the productivity of its citizens.
China, the world’s most populous country, exemplifies this. Beyond its vast population, China has become the world’s engine, manufacturing a significant portion of global goods. The country has invested heavily in human capital development, reaping substantial rewards.
Nigeria can emulate and domesticate the Chinese model rather than lament that our population and God-given crude oil resources are the major causes of misery. Human capital development is more valuable than oil and mineral resources if harnessed effectively.
China’s success demonstrates that technology and technical expertise can trump natural resources. Despite lacking oil, China has leveraged its human capital to achieve remarkable growth.
Arc. Aliyu Tanimu: Architect, entrepreneur & writer. I merge creativity, innovation & social impact. Founding startups, designing impactful spaces & storytelling, I drive sustainable solutions. 07033399363
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