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Nigeria: Facilitating resilient and sustainable infrastructural development

By Gbenga Olawepo-hashim

NIGERIA is great not just because it is the seventh most populous country on the planet. It is an important nation not only on account of her oil wealth It is significant more because of the energy of her people, whose creativity and resilient spirit of enterprise continues to assure her progress even in the face of seemingly hopeless situations. It is due to the hard-work and industry of the ordinary Nigerians- the nation’s greatest asset, that Nigeria attained a GDP rebased at $510 billion in 2013 exceeding that of South Africa to become the biggest African economy even in the face of her parlous infrastructure.

The feat is the result of the toiling of small scale entrepreneurs, who continue to create value without adequate electricity, cottage food processors, without affordable financing, farmers without the scantest of state support; artisans, bold and imaginative business men and women, dynamic financial managers, young innovators creative artistes and hardworking professionals.

Remarkably, Price Water Cooper predicts that the country’s economy will probably grow to be the ninth largest economy in the world by 2050. The basis for this has already been laid over the past ten years with the country recording 6-7% annual growth consistently.

Annual growth

In 2015, even with the collapse in oil price – the country’s major export – the economy still managed to grow at 2.8 per cent compared to 1.2 per cent of South Africa; 1.5 per cent in the Euro Zone; -2.6 per cent in Brazil and 2.0 per cent in the US last quarter. These occurred despite more than fifty per cent collapse in oil revenue and slowdown in government business due to the inauguration of a new government. Growth in the

Nigeria economy is expected to be sustained as the economy has acquired a resilience beyond oil and natural resource exploitation which accounts for only 14 per cent of GDP as long as the political and security situation remains stable.

Nigeria has also recorded a robust expansion of her middle class, which Standard Bank reported has grown by six-folds between the year 2000 and 2010. The Nigerian diaspora community is an integral part of the Nigeria growth story. In 2013, foreign remittances to Nigeria was a record $21billion USD. This forms part of the incredible contributions of Nigerians abroad, innovators, small business operators and ordinary folks eking out a living for themselves the hard-way – picking off tough jobs that a lot of people in their host communities ignore.

Brilliant people of Nigerian decent stand up daily to be counted as part of the positive pages of the rising Nigerian story. The Imafidon twins Paula and Peter broke the world mathematic record passing the Cambridge Advanced Level Math at age eight, the youngest ever to do so. Chinedu Echeruo, founder of Hopstop.com purchased by Apple at a price of $1billion USD is blazing the trail in the ICT world.

Dr Victor Olalusi who scored 5.0 CGPA at the Faculty of Clinical Sciences at Russian National Medical University in 2013, arguably the first in the world to do so are among a growing list of sterling performers. Back home in 2012, four Nigerian teenage girls namely Duro Aina, Akindele Adeola, Faleke Oluwatoyin and Bello Eniola figured a way to generate electricity from urine to power a generator for six-hours.

Recently, 24 year-old Oluwatobi Olasunkanmi won the William Charnley Prize for the best First Class in Law at the University of Cambridge. Right here in this hall we have Mervin Azeta, a female Chemical Engineer who has just completed her Master’s degree here at Imperial with a distinction, having achieved a first class honour in her first degree from the University of Benin, Nigeria, and I know there are similar more stories of great achievers in this gathering today.

This is the Nigerian spirit that turns out outstanding achievers from the harshest imaginable environment. Your guesses are as good as mine, where Nigeria can be in the next ten years if her hardworking people can enjoy the infrastructure support that their peers in comparable middle income countries take for granted. I suspect this is one of the reasons why the ICNS has invited us to explore the topic “Facilitating Resilient and Sustainable Infrastructural Development.”

The state of Nigeria’s infrastructure: A number of studies in the recent past have highlighted the extent of decay and decline in the Nigerian Infrastructure. A 2014 World Economic forum report ranks Nigeria 140th out of 160 c0untries surveyed. A 2013 AFDP publication titled “An Infrastructure Action plan for Nigeria” reported that the Nigeria infrastructure accounts for 20-25 per cent of the GDP compared to 70 per cent of the GDP in most other middle-income economies with comparable size to that of the Nigerian economy.

PRESIDENT MUHAMMADU BUHARI
PRESIDENT MUHAMMADU BUHARI

Electricity generation

To drive the story home, one only needs to compare Nigeria’s 4000 MW available electricity capacity to South Africa’s 45 000 MW to a population of 53m. To be at the same electricity generation capacity per head, Nigeria will need to achieve an estimated 160 000 MW available capacity for her 170million population. Water supply is not any better, as only four per cent of the citizens had access to pipe borne water as at 2012 compared to 16 per cent average for Sub-Saharan Africa.

On Transportation infrastructure, while road transport remain widely in use with the countries road network expanding from 6000 km at independence to 197,000km in 2012 only about 18 per cent of the roads are paved. The roads and bridges are in various states of disrepair; air and water transportation are below acceptable standards and our ports and railways services are in a near state of complete abandon.
AS a matter of fact, the country has not witnessed the construction of any new green field port over the last four decades despite a rapidly expanding economy. According to the AFDP 2013 study, of all the freight that arrived Nigerian ports, only 0.2% travelled by rail.
The oil refineries are in an incredibly bad shape. Nigeria, the 5th largest producer of oil has turned into a net importer of petroleum products due to the shameful state of gas and pipeline infrastructure. Hospitals and educational facilities are in a state of decay crippled by the manacles of poor maintenance and underdevelopment.

The reasons for the infrastructure decay are not far-fetched. They include; lack of adequate investment from both the public and the private sector, lack of adequate maintenance programme and capacity building issues.

In order to upgrade the nation’s infrastructure for the purpose of supporting the desired economic growth target and socioeconomic development objectives, the AFDP forecasts Nigeria requires $350 billion USD CAPEX investment over a period of nine years. It also estimates that $100 billion USD is required over the same period as OPEX investment.

Private sector commitment

A recent McKinsey projection on the cost of upgrading Nigeria infrastructure is not too far from the AFDP assumptions. McKinsey projects that $31 billion USD is required annually over a period of ten years. Both studies expect most of CAPEX investments to come principally from Federal Government Infrastructure Funding commitment, Public-Private Sector collaboration through the PPP and direct private sector investment. Unfortunately, the funding commitment from the Federal Government to infrastructure has been disappointing as only a meagre $3.6 billion USD commitment to Capital Expenditure was provided for in the 2014 budget. Private sector commitment has also been small and slow in coming.

Challenges of building a resilient and sustainable infrastructure: The task of building a resilient infrastructure that will meet the developmental needs of the country are many but I will limit myself to five critical areas as I assume that this audience will be more interested in how to scale the hurdles than an exhaustive list of the problems.

For our purpose I have identified;
Funding,  Administrative and Bureaucratic impediments to private sector participation in infrastructure development, Man-Power challenges, Lack of industrial base to locally produce the component of infrastructural facilities, Re-calibrating the Electricity Sector Reform

Funding: Though Nigeria has been severally referred to as a rich country whose income has been ravaged by rampant corruption accounting for its abysmal level of infrastructural development; this assumption is only half the truth. The revenue collected by the Federal Government, even when not stolen, is grossly inadequate to cater for a population of about 170 million people.

During the season of high Oil price, the country’s total receivables from oil sales amounted to about $50 billion USD in twelve months. This revenue is comparable to the 2014 earnings of Disney World, Florida, USA which was a record $48 billion USD.

Ancillary to the small revenue base of the country is the misapplication of the revenue collected through a consistent disproportionate allocation of about eighty per cent of revenue to recurrent expenditure leaving little or nothing for Capital Expenditure. Lack of funding for Infrastructure, Manufacturing and Industrialisation is compounded by the shallowness of the Nigerian banking system. The existing banks have proved incapable of lending to Infrastructure and the real sector.

Policy makers will have to examine whether it makes sense for Banks to hold licenses for merely charging a premium on the economy without adding the needed value for infrastructural growth and development of manufacturing.

It may be time for decision makers to examine the propriety of encouraging successful global banking brands with reputation for infrastructure financing to bring more depth to the Nigerian banking sector.

Administrative and bureaucratic impediments to private sector participation in infrastructure development: There is no doubt that given the size of its market, the high rate of return that investment in Nigerian economy commands compared to other emerging markets, the country should be one of the best destinations for private sector investment in infrastructure. The country also has clearly defined laws and institutions that spell out the path to private sector participation in the economy.

Electricity sector

Nigeria’s Electricity Sector Reform Act 2005 for instance, is one of the most advanced reform laws in the emerging markets. Yet, the bureaucratic civil service, which most of the economic liberalization laws seek to keep out of the way of private sector investment, struggles everyday to return to reckoning keeping investors applications for permits and licenses unattended to for years.

Dismantling the unnecessary administrative red tape and multiple agencies’ interventions in administrative processes is one of the simple but crucial steps Nigeria must take immediately in order to receive the desired private sector investment in her ailing infrastructure.
Man-power challenges: Project developers in the country frequently bemoan the lack of qualified and technically competent hands for project implementation.

The cost of engaging expatriate hands with requisite skill-sets is unsustainable and also creates cost over runs. There is an urgent need to reform educational curricular with a desire to emphasize the acquisition of technical skills required for the development of infrastructure and industrialization of the country.

Middle level manpower

Particular attention must be paid to the development of middle level manpower such as welders, mechanics, builders with up to date certification in modern vocational training centres. The training of Accountants, Engineers, Lawyers with project development and management skills are also urgently required.

The pool of qualified engineers and other professionals of Nigerian descent in the diaspora are crucial to the task of building local manpower capacity for industrialization and development.

Lack of industrial base to locally produce the component of infrastructural facilities: It is trite fact that most modern infrastructure, machine tools and equipment are largely — after invention and design — a product of the coupling together of metals, iron, steel, glass, aluminium and petrochemicals.

The absence of sufficient local production of these items means that a nation will be forever consigned to mass importation of finished goods at prohibitive cost and condemned to the status of a primary producer.

This particular challenge of the Nigerian economy is perhaps its most fundamental impediment to industrialization and infrastructural growth. The quantity of steel produced in a country is a signal to its technological and industrial advancement. Nigeria currently produces only 2.5 million tonnes per year and imports about 17 million tonnes- very low quantity produced and consumed- compared to other middle-income economies.

Turkey produces 34million tonnes per year, India 86.5million tonnes and Brazil 33.9m tonnes per year.

Re-calibrating the electricity sector reform; Building Sustainable Infrastructure and a new industrial economy is impossible without adequate electricity supply at the point of need. Most manufacturers’ particularly small-scale producers in Nigeria have had to bear huge cost through self-generation of electricity using diesel and petrol as fuel. The self-generating energy supplier mode has a price tag of N90/kw compared to N22/kw grid price of electricity.

Given that prevailing interest rate to assess finance in Nigeria is 22% compared to 8.5% in South Africa, 7.8% in Egypt, China 3.4% and in the US 2.33%, the Nigerian manufacturer is already not competitive. The burden of high cost of production could be lighter if electricity supply can be assessed at the grid price on a stable basis and even at a price a little higher than the current grid cost.

The electricity sector reform inaugurated by the 2005 Electricity Sector Reform Act in Nigeria was designed to address the challenges facing the sector with a view to making private sector the driver of investment and efficient management of the power sector. The reform rests on two legs; privatization of the existing utilities on one hand and the licensing of Private Independent Power Producers on the other.

Infrastructure development

The participation of new Independent Power Producers (IPPs) in the sector are specially very crucial because whilst privatization of existing utilities merely transfers ownership to the new operators, it is the new greenfield IPPs that add capacity to the network. Unfortunately, in the past five years no new IPP has been commissioned in Nigeria. As a matter of fact last year no single turbine was imported to Nigeria and none has been imported this year, compared to 15 GE turbines that were shipped to Egypt this year alone.

Ten years running, this reform has been hampered by the difficulties associated with the private sector participation in infrastructure development identified previously. The difference here is, the sense of urgency that the resolution of these issues in the power sector demands.

They are questions to which answers cannot be delayed further; they must be addressed right now! Policy formulators only lament and sing the power inadequacy like a song and failing to take the practical executive actions that do not even require legislation to achieve.
As an operator in this sector, I have outlined some immediate steps to be taken to recalibrate the power sector reform.

As a matter of fact, the country has not witnessed the construction of any new green field port over the last four decades despite a rapidly expanding economy. According to the AFDP 2013 study, of all the freight that arrived Nigerian port, only 0.2% throughput travelled by rail.

The oil refineries are in an incredibly bad shape. Nigeria, the 5th largest producer of oil has turned into a net importer of petroleum products due to the shameful state of gas and pipeline infrastructure. Hospitals and Educational facilities are in a state of decay crippled by the manacles of poor maintenance and underdevelopment.

The reasons for the infrastructure decay are not far-fetched. They include; lack of adequate investment from both the public and the private sector, lack of adequate maintenance programme and capacity building issues.

In order to upgrade the nation’s infrastructure for the purpose of supporting the desired economic growth target and socioeconomic development objectives, the AFDP forecasts Nigeria requires $350 billion USD CAPEX investment over a period of nine years. It also estimates that $100billion USD is required over the same period as OPEX investment.

A recent McKinsey projection on the cost of upgrading Nigeria infrastructure is not too far from the AFDP assumptions. McKinsey projects that $31 billion USD is required annually over a period of ten years. Both studies expect most of CAPEX investments to come principally from Federal Government Infrastructure Funding commitment, Public-Private Sector collaboration through the PPP and direct private sector investment.

Unfortunately, the funding commitment from the Federal Government to infrastructure has been disappointing as only a meagre $3.6 billion USD commitment to Capital Expenditure was provided for in the 2014 budget. Private sector commitment has also been small and slow in coming.

CHALLENGES OF BUILDING A RESILIENT AND SUSTAINABLE INFRASTRUCTURE
The task of building a resilient infrastructure that will meet the developmental needs of the country are many but I will limit myself to five critical areas as I assume that this audience will be more interested in how to scale the hurdles than an exhaustive list of the problems.

For our purpose I have identified;
i. Funding
ii. Administrative and Bureaucratic impediments to private sector participation in infrastructure development
iii. Man-Power challenges
iv. Lack of industrial base to locally produce the component of infrastructural facilities
v. Re-calibrating the Electricity Sector Reform

FUNDING
Though Nigeria has been severally referred to as a rich country whose income has been ravaged by rampant corruption accounting for its abysmal level of infrastructural development; this assumption is only half the truth. The revenue collected by the Federal Government, even when not stolen, is grossly inadequate to cater for a population of about 170 million people.

During the season of high Oil price, the country’s total receivables from oil sales amounted to about $50 billion USD in twelve months. This revenue is comparable to the 2014 earnings of Disney World, Florida, USA which was a record $48 billion USD.

Ancillary to the small revenue base of the country is the misapplication of the revenue collected through a consistent disproportionate allocation of about eighty per cent of revenue to recurrent expenditure leaving little or nothing for Capital Expenditure. Lack of funding for Infrastructure, Manufacturing and Industrialisation is compounded by the shallowness of the Nigerian Banking system. The existing banks have proved incapable of lending to Infrastructure and the real sector.

Policy makers will have to examine whether it makes sense for Banks to hold licenses for merely charging a premium on the economy without adding the needed value for infrastructural growth and development of manufacturing. It may be time for decision makers to examine the propriety of encouraging successful global banking brands with reputation for infrastructure financing to bring more depth to the Nigeria banking sector.

ADMINISTRATIVE AND BUREAUCRATIC IMPEDIMENTS TO PRIVATE SECTOR PARTICIPATION IN INFRASTRUCTURE DEVELOPMENT
There is no doubt that given the size of its market, the high rate of return that investment in Nigerian economy commands compared to other emerging markets, the country should be one of the best destination for private sector investment in infrastructure. The country also has clearly defined laws and institutions that spell out the path to private sector participation in the economy. Nigeria’s electricity sector reform Act 2005 for instance, is one of the most advanced reform laws in the emerging markets. Yet, the bureaucratic civil service, which most of the economic liberalization laws seek to keep out of the way of private sector investment, struggles everyday to return to reckoning keeping investors applications for permits and licenses unattended to for years.

Dismantling the unnecessary administrative red tapes and multiple agencies’ interventions in administrative processes is one of the simple but crucial step Nigeria must take immediately in order to receive the desired private sector investment in her ailing infrastructure.

MAN-POWER CHALLENGES
Project developers in the country frequently bemoan the lack of qualified and technically competent hands for project implementation. The cost of engaging expatriate hands with requisite skill-sets is unsustainable and also creates cost over runs. There is an urgent need to reform educational curricular with a desire to emphasize the acquisition of technical skills required for the development of infrastructure and industrialization of the country. Particular attention must be paid to the development of middle level manpower such as welders, mechanics, builders with up to date certification in modern vocational training centres. The training of Accountants, Engineers, Lawyers with project development and management skills are also urgently required. The pool of qualified Engineers and other professionals of Nigerian decent in the diaspora are crucial to the task of building local manpower capacity for industrialization and development.

LACK OF INDUSTRIAL BASE TO LOCALLY PRODUCE THE COMPONENT OF INFRASTRUCTURAL FACILITIES
It is trite fact that most modern infrastructure, machines tools and equipment are largely- after invention and design- a product of the coupling together of metals, iron, steel, glass, aluminium and petrochemicals. The absence of sufficient local production of these items means that a nation will be forever consigned to mass importation of finished goods at prohibitive cost and condemned to the status of a primary producer.

This particular challenge of the Nigerian economy is perhaps its most fundamental impediment to industrialization and infrastructural growth.

The quantity of steel produced in a country is a signal to its technological and industrial advancement. Nigeria currently produces only 2.5 million tonnes per year and imports about 17million tonnes- very low quantity produced and consumed- compared to other middle-income economies.

Turkey produces 34million tonnes per year, India 86.5million tonnes and Brazil 33.9m tonnes per year.

RE-CALIBRATING THE ELECTRICITY SECTOR REFORM
Building Sustainable Infrastructure and a new industrial economy is impossible without adequate electricity supply at the point of need. Most manufacturers’ particularly small-scale producers in Nigeria have had to bear huge cost through self-generation of electricity using diesel and petrol as fuel. The self-generating energy supplier mode has a price tag of N90/kw compared to N22/kw grid price of electricity.

Given that prevailing interest rate to assess finance in Nigeria is 22% compared to 8.5% in South Africa, 7.8% in Egypt, China 3.4% and in the US 2.33%, the Nigerian manufacturer is already not competitive. The burden of high cost of production could be lighter if electricity supply can be assessed at the grid price on a stable basis and even at a price a little higher than the current grid cost.

The electricity sector reform inaugurated by the 2005 Electricity Sector Reform Act in Nigeria was designed to address the challenges facing the sector with a view to making private sector the driver of investment and efficient management of the power sector. The reform rests on two legs; privatization of the existing utilities on one hand and the licensing of Private Independent Power Producers on the other.

The participation of new Independent Power Producers (IPPs) in the sector are specially very crucial because whilst privatization of existing utilities merely transfers ownership to the new operators, it is the new greenfield IPPs that add capacity to the network. Unfortunately, in the past five years no new IPP has been commissioned in Nigeria. As a matter of fact last year no single turbine was imported to Nigeria and none has been imported this year, compared to 15 GE turbines that were shipped to Egypt this year alone.

Ten years running, this reform has been hampered by the difficulties associated with the private sector participation in infrastructure development identified previously. The difference here is, the sense of urgency that the resolution of these issues in the power sector demands.

They are questions to which answers cannot be delayed further; they must be addressed right now! Policy formulators only lament and sing the power inadequacy like a song and failing to take the practical executive actions that do not even require legislation to achieve.

As an operator in this sector, I have outlined hereunder some immediate steps to be taken to recalibrate the power sector reform:

I. Dismantle the delay in licensing of IPPs and the signing of Power Purchase Agreement (PPA) through an executive guideline for the industry that defines Standard Operating Procedures for agencies and institutions. Processing license applications and signing of Power Purchase Agreements should not take more than 90-120 days. Currently it takes 2-3years when in fact, a complete Power Plant could be delivered between 18 -24 months.

II. Federal Government should make Sovereign Guarantee available to all PPAs that the Nigeria Bulk Electricity Trading Company (NBET) concludes and with the requisite 90-120 days LC to ensure bankability of such agreements.

III. Distribution companies and eligible customers, once licensed, should be able to sign PPA with the Generating Companies (GENCOs) and IPPs for the supply of Power without the undue meddlesomeness of the Nigeria Electricity Regulation Commission (NERC). This is the provision of the Electricity Sector Reform Act and this is what it should be.

IV. NERC should be professionalized and focused on effective regulation of the sector; meting out punishment for infractions in the sector rather than attempting to administer the sector as it is currently doing.

V. More attention should be paid to sanctioning operators particularly in the distribution sector who have not delivered on their terms of purchase of their network as the entire value chain depend on effectiveness at this level.

VI. A cost-reflective and fare electricity tariff must be put in place that guarantees reasonable return on investment and satisfies the consumer that he/she has been fairly charged. It is my assumption that an Industrial consumer will be willing to pay a reasonable price for what he/she consumes rather than spend N90/kw on self-generation. The wide spread use of pre-paid meter must be implemented immediately to make this regime work.

SURMOUNTING THE CHALLENGES TO RAPID INFRASTRUCTURAL EXPANSION
Ladies and Gentlemen, though the obstacles to accelerated infrastructural expansion in Nigeria are daunting they are surmountable. Once policy makers and implementers summon the will to immediately take far-reaching actions that are focused and sustained along the following lines;
I. Reordering government expenditure to allow for commitment of at least fifty per cent of government revenue to Capital Expenditure in the 2016 budget and with the aim of increasing to sixty per cent and seventy per cent in 2017 and 2018 budget cycle respectively.

II. The Federal Government should embark on Contractor financed infrastructure projects based on internationally benchmarked pricing; in the construction of rail tracks, supply of locomotives and coaches, and other critical infrastructure. Such selected projects must have the necessary projected cash –flow to pay back to qualify for approval.

III. There should be an immediate bid process for the concessioning of two sites for the construction of two green field ports in areas with the natural port depths.

IV. Immediate elimination of bureaucratic curtains, red tapes and elimination of duplication of regulatory approvals for private sector direct investment in infrastructural development as now common in the power sector. This is to be achieved by the instrumentality of a sectorial guideline that institutes a Standard Operating Procedure detailing timeline for processing applications with a high-level audit system of the processes.

V. The Federal Government should use its Sovereign Financial Instruments to give credit guarantees to strategic private sector investments in key areas such as power generation and transmission as well as other urgent infrastructural priorities. The current external debt profile is comparably low and puts Nigeria in a good position to leverage its sovereign instruments for infrastructural growth. Nigeria’s debt to GDP ratio is 10% compared to Brazils 58.91%, South Korea’s 35.98%, China’s 41%, India’s 66%, Euro zone’s 91% and US’ 102%.

VI. Global Infrastructural spending is predicted to have a rebound within the next ten years. An Infrastructure-starved economy such as Nigeria, should position itself to receive a good slice of the funds. According to a research by Oxford Economist and Price water House Cooper about $78 trillion USD is to be spent on infrastructure globally within the next ten years. Only 10% of the money will be spent in Europe, 60% in China and the Asia Pacific, the remaining will be spent in the rest of the world. Nigeria is in a good stead to attract a significant portion of the funds projected for the rest of the world especially those emanating from private funding institutions and infrastructure funds including pension funds.

The IRR on Infrastructure investments in the country, which averages between 15-21% after taking into account the allowance for risk premium and insurance makes the Nigerian market competitive if the manmade obstacles are immediately removed. IRR on projects in Nigeria, which could hit 25-40% in oil and gas infrastructure compares favourably well in the emerging markets; a typical IRR trend in emerging markets is 12-19%.

RESTRUCTURING THE ECONOMY FOR A TASK OF BUILDING A RESILIENT INFRASTRUCTURE AND AN ALL-ROUND SOCIOECONOMIC DEVELOPMENT
Ladies and Gentlemen, whilst the above suggestions would suffice to kick start the process of rapid infrastructural development, they are inadequate to do so on a sustainable basis. The task will require the restructuring of the national economy with new set of goals, objectives, organization and structure. The economy will have to be organized in a manner that can make the needed quantitative and qualitative leap.

Indeed, every economy in history that has witnessed transformation from a primary producer status to a modern industrial economy has had to undergo a rapid leap over an identifiable historical epoch. It is at such a time that the technical capacity for mass production of steel, machine tools, and chemicals are acquired. It is at such a time that manufacturing appears on a mass scale and solid minerals and agricultural are linked to industry.

For the Nigerian quantitative leap to be achieved the economy must target a double digit growth over at least ten years period; at such a time, the financial sector will be re-directed and aligned to the goals of financing a modern industrial economy.

We have listed below some important policy objective and goals that will form the direction of a new economy imbued with the capacity for achieving sustainable development;

a) Monetary and Fiscal Policy must be geared towards the growth of the Infrastructure, Manufacturing, Industry and Agriculture.
b) Tax and Revenue collection must be reformed to increase nationally collectable revenues.
c) Interest rate must be kept at single digit between 6-8%.
d) Economic planners must prioritize massive investment in iron and steel, meteorology, machine tools, glass production and petrochemicals.
e) SMEs and small agricultural producers should enjoy concessionary lending rates.
f) Foreign Exchange Regime must be stable to attract long-term investment.
g) Proprietary rights of individuals must be respected as well as the sanctity of contracts and agreements to make Nigeria an attractive destination for private sector investment.
h) Protection of Intellectual Property must be given high priority to spur innovation and the creative sector of the economy.

BRIDGING THE SOCIAL DIVIDE
Nigeria as a country cannot pull together in peace and stability for the goals of sustainable development if majority of her people still live in squalor and poverty whilst we relish in impressive GDP figures. The fact that more than 70% of the population live in poverty and 60 million are illiterates [UNESCO] is both a scandal and a tragedy.

It is no longer news that our country is growing apart like an apartheid State. It is true that the middle class has grown six-fold in the past 12 years; so also are the numbers of complete illiterate citizens, mostly young people without any skill to participate in the modern world because we have in the recent past, surrendered the welfare of our people to market forces – the survival of the fittest! No wonder our impressive growth figures are blighted by massive upheavals in the underbelly of our country.

The social problems are not going to abate except Nigeria invests immediately in the welfare of the people. According to a recent study by the African Development Information Centre, by 2030, Nigeria’s population will grow to about 210 million; 70 million of this forecast population will be living in North- Eastern Nigeria where there is currently an extremist insurgency; 35 million of which will be under the age of fifteen and would not have received any form of formal education. This is alarming!

We must invest now to bridge the social divide by making primary and secondary education completely free of all cost with feeding and welfare support at primary school levels. This must be a federally financed program worked out with local authorities for effective implementation. Free education must be entirely free indeed without hidden cost such as examination fees and cost of uniforms.

The quality of educational and health institutions must be upgraded through the recruitment of qualified professionals, training and retraining of existing hands making available needed equipment and infrastructure and improving productivity and output through a scientific audit system that ties reward and emoluments to performance.

Nigeria must quickly introduce a comprehensive program of accessible, cost-free and qualitative health service coverage for all Nigerians. Nigeria can afford these programs right now as we are already spending billions of naira managing the social upheavals that are caused by decades of ignoring the welfare of the people especially the young and the vulnerable.

CONCLUSION
Ladies and gentlemen, Nigeria has all it takes to confront the urgent task of turning around her infrastructure and building an economy that will surpass all predictions. The country has the most important asset a nation needs to be at the top – a very determined people – never giving up when even no one gives them a chance to pull through. Just 17 years ago Nigeria had only 400,000 phone lines today Nigeria has about 100 million. Last year Nigeria pulled a peaceful election even when some predicted her disintegration. The country has the energy to confront her challenges coming up stronger and better even sometimes from behind. With strong determination and positive actions we will surmount our challenges!

Thank you for listening. God bless Nigeria, God bless her friends too!

Gbenga Olawepo-Hashim presented this paper at the annual symposium of Nigerian Students’ Society of Imperial College, London. 


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Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.