• Tuesday, December 05, 2023
businessday logo


The economy of Nigeria and those benefiting from it

The economy of Nigeria and those benefiting from it

When a multimillionaire was asked how much money it takes to be happy, he replied, ‘Just a little more’. Now, everybody in Nigeria – poor or rich wants more and more. Not really in terms of greed but discontentment. The country is bastardized and the economy is in shambles. We cannot describe the Nigerian economy as a low-income or mixed economy.

The entrepreneurs, business owners and small enterprises do not benefit from the economy. Rather the economy favours only the political class and those in government. The government has sold a lie to the citizens of Nigeria saying that fuel subsidy benefits only the rich.

Far from the truth, the subsidy regime benefited only the corrupt politicians and now that the fuel subsidy was removed, nobody but the APC-led federal government is benefitting from it. As the economy continues to dwindle and the masses are enmeshed into hard times, poverty and suffering, they keep getting the same response from the government.

‘The problem is too big, there is nothing I can do about it?’ This is what the president and those in government keep telling the Nigerian masses. When shall it be over? When shall it end? It did not take the president a night in office to increase the price of petrol, remove fuel subsidy and increase taxes. Yet, seeing the socio-economic conditions of Nigerians from such drastic decisions, he responded by saying he wished he could do something about it.

An economy encompasses all the activities related to the production, consumption, and trade of goods and services in a nation or a small town. The production, consumption, and distribution of goods and services combine to fulfil the needs of those living and operating within the economy. Market-based or free market economies respond to the demand of consumers. But it does seem that the economy of Nigeria is controlled and commanded by the government for their sole benefit.

The macroeconomic indicators in Nigeria have been shallow and the government is not bothered. We hear stories about Dangote Refinery, taking loans from the Central Bank using the national foreign reserve. The unemployment rate is high and inflation has continuously remained in double digits. A balance of trade has been hard to achieve because Nigeria operates a consumption-driven economy.

Economics studies how people get what they need or want. Nigeria is endowed, blessed with both human and material resources even favourable climatic conditions but her citizens groan, moan and lament due to greed, corruption and mismanagement from political leaders. As a developing country, the income per capita keeps going down every year.

The standard of living is reduced, cost of living is higher while education, literacy and health is given little or no attention by the government. There is poor infrastructure and income inequality in Nigeria. The average life expectancy for a Nigerian is 54 to 55 years. Her presidents feel comfortable to parley or go into partnership with developed countries like France, UK or USA while their country keeps going down the drain for so many decades.

During the administration of Muhammad Buhari, Nigerians complained that ₦3000 can no longer make a meal, soup. Here we are in a new economy named “Tinubunomics”. At this time, most families are financially stressed. Family incomes are exhausted not on school fees or summer holidays but on food and groceries. ₦5000 cannot take care of family dinner.

How do we move from here – one man who is neither in the military nor paramilitary was given the contract to guard the oil pipelines. The National Security Adviser (NSA), Mallam Nuhu Ribadu, has said that Nigeria is still losing 400,000 barrels of crude oil daily to local and international thieves despite the efforts to end the menace. Albert Einstein once said: “Insanity is doing the same thing over and over again but expecting different results.” The question is, what has the present government done differently to fix or stabilize the economy?

From all indications the Port Harcourt Refinery will not be operational in 2024 and the price of petrol will keep going up just as the value of Naira depreciates and the businessmen hardly find solace in their struggles.

The present government of Bola Ahmed Tinubu came up with the Ministry of Marine and Blue Economy advocating for growth, sustainable development and economic prosperity.

Dr. Bosun Tijani, the minister of Communications & Digital Economy, has disclosed that the federal government secured a $500 million loan to fund the Digital Economy. President Bola Tinubu has expressed his readiness to pursue Nigeria’s economic reforms policy to a logical conclusion despite the political crisis rocking the neighbouring Niger Republic.

Nigeria’s GDP Growth slowed to 2.51% amid economic crisis and crude oil production dropped to 1.22mbpd, amounting to 5.34% input to GDP in Q2 of 2023. Nigerians are watching – not just the Judiciary but every aspect of governance and politics.

More so, a government that does not regard the poor and elderly is seen as uncaring, uncompassionate and unjust. It is seen as a government that does not value its most vulnerable citizens. This can lead to a number of negative consequences. It can lead to a sense of hopelessness and despair among the poor and elderly, and can make it more difficult for them to get the help they need.

When the government takes steps to regard the poor and elderly, they are investing in the future of their societies. They are helping to create a more just and equitable world where everyone has the opportunity to thrive. In present-day Nigeria, ₦1000:00 cannot give anybody two consecutive meals.

As a columnist in the Nation Newspaper, Sam Omatseye in ‘Like Temptation of Christ’, pointed out that it is difficult to classify poor people in Nigeria. He was of the view that we cannot measure or help poor people in Nigeria. Poverty refers to the state or condition in which people or communities lack the financial resources and essentials for a minimum standard of living. As such, their basic human needs cannot be met.

People and families who live in poverty may go without proper housing, clean water, healthy food, and medical attention. Be that as it may, some governors are very quick to demolish houses, shops, stores, and buildings without any resettlement or compensation plans.

To them, the government owns everything and does not owe anybody any explanation. Social Safety Nets used in developed countries to cater for the poor cannot be effective in Nigeria because most of the Nigerian politicians are still very hungry. We are yet to see the ‘Robin Hood Economy’ and social welfare database for poor Nigerians as promised by praise-singers.

Furthermore, the national economy of a country is based on small and medium industries. The micro, small and medium enterprises create jobs, raise wages, enhance social mobility and promote innovation but they are stifled in Nigeria. The informal sector is struggling, shut down due to the high cost of PMS. The Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, told Nigerians to expect a significant improvement in the overall economic performance.

Sadly, the economy of Nigeria is solely dependent on crude oil and refined crude oil. Despite the profligacy in governance, reckless spending and borrowing, every new government increases the price of petrol to ensure free-flow of funds especially for embezzlement.

The boom in the 1970s crumbled due to lack of plan, management and commitment. We have progressed from indigenization, privatization, even austere measures but the government is never sincere, straightforward or competent.

Read also: New job data suggests Nigeria is a ‘hustle economy’

Finally, we have heard the modern expression, “Don’t fight it – it’s bigger than both of us.” We are often told that we cannot do anything about the oppressive government in Nigeria. ‘You cannot fight the old order, you can’t dismantle the structure of criminality’, they say. Respected preachers tell Nigerians to accept it in good faith. Christians are told to surrender and suffer.

As long as you live in the world, you have to share in the diseases, the defeat, the poverty and the failure of the system. It’s part of the tribulation, trials, distress and frustration that Jesus talked about, they will say. You’ve got to have your own share of the problem. It is a bad world, an incredible bad world. But we have found a secret – An economy that benefits the president, his cronies, supporters, beneficiaries and hangers-on is not a good economy.

Nigeria’s battered economy requires immediate attention and a holistic approach to recovery. The nation must move beyond dependence on oil, combat corruption, invest in education, and empower its citizens through entrepreneurship.

There is a need for foreign direct investments. With the concerted efforts of taking back our country and the visionary leadership of a New Nigeria, we can rise from the current challenges and lay the groundwork for a more prosperous future.