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AT Vanguard Economic Discourse: How to rescue Nigeria, by experts

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By Our Reporters
LAGOS — Economists and private sector leaders, at the third edition of the Vanguard National Economic Discourse, V-NED III, yesterday, called  for  vision-driven policy interventions that will deliver the nation from socio-economic stagnation and  fast track national development.

Chaired by former Minister of National Planning, Dr. Shamsuddeen Usman, with eminent banker and founding Managing Director/Chief Executive, Guaranty Trust Bank Plc, Mr. Fola Adeola as keynote speaker, the Discourse also had Managing Director of Heritage Bank Plc, Mr Ifie Sekibo, Director-General of the Lagos Chamber of Commerce & Industry, LCCI, Mr Muda Yusuf, General Secretary of the Nigerian Labour Congress, Dr. Peter Ozo-Eson, and Dr. Doyin Salami, Associate Professor at Lagos Business School as discussants.

Vanguard Economic Discourse —From left: Dr. Peter Ozo-Eson, General Secretary, NLC; Mr. Ifie Sekibo, MD, Heritage Bank Limited; Mr. Muda Yusuf, DG, Lagos Chamber of Commerce and Industry; Mr. Fola Adeola, Founder/Chairman, FATE Foundation & Keynote Speaker; Dr. Shamsuddeen Usman, former Minister, National Planning; Dr. Doyin Salami, Economist, LBS and Mr. Gbenga Adefaye, GM/Editor-in-Chief, Vanguard Newspapers, during the Vanguard Economic Discourse with the topic ‘Human Development Index Vs Economic Growth; Nigeria’s Policy Options, held in Lagos, yesterday. Photo: Joe Akintola, Photo Editor.

In his keynote address,  on the theme of the Discourse, “Human Development Index vs Economic Growth: Nigeria’s Policy Options”, Adeola stated that Nigeria needs both economic growth and human development to avert a looming economic disaster resulting from the crushing grip of 12 giant socio-economic evils on her   developmental potentials.

He stressed that achieving economic growth and human development requires vision-inspired policy interventions designed to bring down barriers to national development.

Speaking on the necessity of both economic development and human capital growth, Adeola said: “Human development costs money, so there is no denying that economic growth is important. Without money, you cannot fund healthcare or raise living standards or provide education.

“In fact, looking at our current GDP per capita, it is clear for all of us to see that our GDP has to go up for there to be any meaningful change in the fortunes of the population. To that extent, it is possible to say that economic growth is necessary for sustained human and social development. Let us be clear, however, that neither triggers it. You can have consistent GDP growth year-on-year for five years and you still find poverty among the people and poor education among the people. Successful economic policies may not trigger or ensure human development.

#VanguardDiscourse: FG must grant education, health sector tax holiday – LCCI

“Economic growth does not address how the money is spent, what investments are made in people and what disparities exist. If social policy is not targeted and deliberate, human development does not necessarily follow and without human development, sustained economic growth is impossible. How can countries produce in a knowledge economy if the people are uneducated and unhealthy? The answer is simple, they cannot. So, we must produce and we must ensure that our people are taken care of out of this bounty.

Adeola on Policy Interventions

“This is not a start-up sovereign state, and not a nation in any real sense and deeply plagued by fundamental evils which if not addressed will ensure our ruin.

“The role of the government is to respond to and create an enabling environment for the needs, challenges and aspirations of its population to be addressed and that is why, if there are barriers to these, taking them down must be the foundation of policy. That is why they are called policy interventions.

“Their singular purpose is to remove the barriers from national attention. The choice of the word “evils,” as a matter of fact, ‘giant evils’, in describing our particular barriers denotes the function of their depth and destructiveness and it is deliberate. To call them challenges will be a lie.

“It will cause us to underestimate their pervasiveness and leave any responses we may craft inadequate to address their ruin. If we are running away from the insufficiency of GDP and HDI as foundations for policy then we must run towards the kind of brutal honesty that will compel us to strive for a different existence.”

Sekibo seeks robust focus on energy

Speaking at the event, Managing Director of Heritage Bank Limited, Ifie Sekibo, pointed out that the desired economic growth would require a change in policy for lending to the energy sector to ramp up power supply. This, he believes, would improve the level of economic activities and deliver positive impact on the standard of living for the citizenry. See Page 19 for more on Policy Review for the Energy Sector.

LCCI boss seeks greater investment

Corroborating Adeola’s position on the symbiotic relationship between economic development and human capital, Director-General, Lagos Chamber of Commerce and Industry (LCCI), Mr. Muda Yusuf said: “If you look at all the leading economies today, there is a correlation between the size of their economy and the welfare of their citizens. The correlation may not be 100 per cent, but clearly, there is a correlation.

When we talk about human development index or the quality of human life, it requires a great deal of investment and you need resources to make that investment.”

Highlighting the inadequacy of resources at government’s disposal for development, and the need to encourage private sector investment in the provision of social services, Yusuf said: “Look at the story of Nigeria today; practically all our social sectors, organizations or segments are collapsing. The public school system has practically collapsed. The public health institutions have also practically collapsed.

“We find a situation today where you have more private schools in many of the states than there are public schools. We are also faced with a situation where we now have more private hospitals than the public hospitals. That goes to show the role that the private sector is playing even in the social sector space.

‘Special needs children, not liabilities’

“It also underscores the fact that the resources of the state are dwindling by the day and making it difficult for the government to discharge some of its fundamental obligations in the social space namely, issue of education, health and even security.

“It is very important that we also deal with the issue of resources. The government today does not have the resources to take proper care of social investment. We have to deal with this in two ways.

“We need to deal with the issues of tax and import duty to support the private sector’s contribution to social investment, in order to grow the capacity of this economy.

“This is because this economy needs funds to grow; we need to grow investment because it is from investment that we can grow revenue, it is with revenue that you can develop education, health services, and support security forces.

“Investment is key, so all our policy equipment that can support micro-enterprises, indigenous investors, FDI, everything should be put on the table because if you do not grow investment space, there is no way you can grow the revenue and there is no way you can increase employment.”

We need to set targets, says Salami

Emphasising the need for vision as the foundation for policy intervention, Dr Doyin Salami, former member, Monetary Policy Committee of the (CBN), said: “We need growth in order to achieve development. Let me state a few things; we need to set targets. For example, two per cent of the Chinese population are currently below the poverty line, and the Chinese say in two years even the two percent below poverty line would have been moved above the line of poverty. What is our own target?

“This is important because in the absence of target there is no direction and that was one of the key points our keynote speaker made; about a vision. What is the vision for Nigeria?”

Ozo-Eson seeks policy shift

Also speaking, General Secretary, Nigeria Labour Congress, NLC, Dr. Peter Ozo-Eson, called for policy shift from economic growth to human development.

He said: “I think therefore, the challenge for policy and for planning cannot be over-emphasised. I think in designing our policies and plans, we should shift away from a fixation on GDP growth to the issues of Human Development index.

“For instance, the education and  health sectors, that play key roles in determining your human development index measure, are areas where our planning and policy must return to emphasis and priority. It is only if we do that in a conscious way that we would be able to actually lift Nigeria from where it is in terms of human development index and ranking and move it up in the future.

“The second major point is that in doing this we need to learn from the examples of nations that we may not regard as rich but have consistently maintained very high positions on the human development ranking.”

What we need to do, by Usman

Former Minister of National Planning and Chairman at the 2019 Vanguard Economic Discourse, Dr. Shamsuddeen Usman highlighted some of the things that need to be done to enhance Human Development Index and economic development.

According to him: “From the practical point of view, let me tell you some of the intellectual and other resources that we have to use to address some of these issues. Yes, I was Minister of Finance when we were reporting 6 per cent, 8 per cent growth and setting target of double digit GDP growth. One always faced the embarrassment, particularly from the media at that time; that you guys are talking of all these your figures and the average Nigerian is not feeling it. So when I was moved from Finance to National Planning one of the three targets I set for myself is that I am going to address that issue. So how did we start? We started by working with other people like EMT, colleagues and particularly with the National Bureau of Statistics  to say we must  generate numbers that will guide policy so that when government is doing something it is very clear and specific. So we started first of all with the measurement of GDP itself in Nigeria. Intellectually from the economic point of view the difference between economic growth and economic development is something that has been dealt with and has been mentioned already.

Even the way we were measuring GDP, there are two fundamental problems: One was that a large sector of our economy is actually excluded in the measurement, that is, the informal economy. What we call the black economy which is a huge percentage of Nigeria’s population, so we are even under-measuring the GDP itself.

“The second one was that the data base that was being used was in the 1990s, the time that we didn’t have GSM; look at how GSM has transformed this economy. Now you are measuring that economy using base data that even did not exist. So we did embark on the issue of re-basing the GDP to bring it to a more recent period where it is more reflective. If you are measuring and comparing, then you are doing it on a more reasonable basis.”

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