Why Nigeria’s Economy Can’t Make Rapid Progress

Why Nigeria’s Economy Can’t Make Rapid ProgressNo one solves a problem s/he does not understand. Putting this statement in another perspective, we say, once our conception of a problem is wrong, we cannot find a solution to it. Nigeria is not making rapid progress because those who are managing Nigeria’s development do not understand the human development process. Let us consider the two main aspects of the development of human societies – economic and political development.

History shows that nations achieve economic development as a platform for political development. Britain achieved the modern industrial revolution (IR) in the period 1770-1850 (Gregg, 1971). The Febians Society and other socialists and labour unions in England formed the Labour Representation Committee in 1900 which metamorphosed into the Labour Party in 1906 as part of the strategy to fight the oppression of workers by business owners (Trevelyan, 1948). The United States of America achieved the modern IR in the period 1850-1900 (Bartlett, et al., 1969). By 1900, many Americans including women in all states, black men in the southern states, Indians and some naturalized immigrants still could not vote. Women could not vote in the United States till 1920 (United States Information Agency, 1994).

Since history shows that the political route is the longer one, the younger nations of Africa ought to emphasize economic development more and adopt committee-type governments in which politicians are given very limited powers rather than executive presidential system in which inexperienced, incompetent and illiterate politicians are given executive powers to mismanage nations based on the fallacious claim that political development precedes economic development in a nation.

Nigeria is an agricultural nation. This also means that over 75 per cent of Nigerians are farmers. Again, history tells us that all the technologically advanced nations of today were also agricultural nations in the past. While Nigeria produces solely agricultural goods, the technologically advanced nations apply science in solving their problems and produce many scientific goods. The challenge confronting Nigeria and other African nations therefore, is acquiring scientific knowledge, skills and capabilities (KSCs), apply them in solving problems and transforming the agricultural economies into industrialised ones. Sadly, those who manage the Nigerian economy never talk of acquiring and applying scientific-KSCs; they always talk of primitive agriculture.

The process of transforming an agricultural economy into an industrialised one is a scientific one which non-scientists do not understand. That is, economists and other social scientists, accountants, bankers, lawyers, etc., who have been managing the economy do not understand the development challenge confronting Nigeria. How could they solve a problem they do not understand? This explains why Nigeria cannot make rapid economic progress.

Let us discuss four grave errors non-scientists managing the Nigerian economy have been making for decades.

Firstly, economists measure growth as change in GDP. Mere increase in GDP does not necessarily translate into real growth and increase in employment. For example, Nigeria’s increase in GDP can come from an increase in the international price of oil. Nigerians make very little contribution to the exploration and production of Nigeria’s oil.

That was why the GDP growth of up to 7 per cent measured during President Jonathan’s administration meant nothing to Nigerians – it was growth without development, no increase in employment. Economists and co, do not know what to measure to promote the industrialisation of an agricultural economy. This is the reason economists cannot promote industrialization.

Economists cannot measure growth in scientific-KSCs because whereas growth in scientific-KSCs is achieved through learning, economists and co., claim that it is through capital investment that a nation achieves sustainable economic growth and industrialization (SEGI).
That is why virtually everyone in government in Nigeria campaigns embarrassingly for foreign investments and opening up the economy. Mere capital investments do not promote SEGI. Capital investment merely acquires structures. All structures experience depreciation; they are therefore Depreciating Assets (DAs). All structures immediately begin to depreciate and cause economic stress, once they are acquired or erected. Economists and co., have always been urging governments to invest in infrastructure. They have been offering bad advice. An agricultural nation emphasizing capital investment may be likened to one attempting to fill a profusely leaking water-tank with water. This is the reason Nigeria’s infrastructure is always in bad shape. Nigeria sees every problem in terms of lack of money. Nigeria would rather build a bank to solve each problem but solves no problem. To economists and co., Nigeria has low Megawatt of electricity installed because it has not invested enough capital. They are wrong. The performance of the GENCOs and DISCOs can only improve with Nigeria acquiring more scientific-KSCs, otherwise worsened because of the depreciation of the generator and the distribution systems.

The learning-people on the other hand appreciate intrinsic value with time and learning intensity; they are therefore, Appreciating Assets (AAs). Hence, a nation emphasizing learning (education, training, employment and research) may measure scientific-KSCs in terms of some or all of:
1) N – the number of people involved in productive work or employment in a nation; 2) M- the level of education/training of those involved in productive activities in the economy and of the people of the nation; 3) L – the linkages among the knowledge, skills, competences and sectors of an economy; 4) r – the learning rates or intensity in the economy and especially among the workforce; and 5) n – the experience of the workforce and the learning history of the society.

All the variables are related to the learning-people. The higher the values of the variables, the better is the economy. It is because industrialisation is a learning and capability-building process that any race that learns and builds-up knowledge, skills and competences to critical levels achieves Industrial Revolution (IR) and builds necessary infrastructure as fruits of IR.

It is also erroneous to encourage an agricultural-based Nigeria to borrow money and erect complex infrastructure other than to promote growth and attract foreign investments.

History shows that after nations have achieved industrialization, they build relevant and adequate infrastructure as fruits or aftermath of industrialization. Economists and co., have therefore been encouraging young Nigeria to build the roof of the house before laying the foundation. A nation doing that cannot make progress. This is the reason Nigeria is always indebted through obtaining long-term loans to erect short-term structures. The over 500 roads and bridges and railways being constructed today would not be there tomorrow. Anyone who looks critically at the perpetually bad state of Nigeria’s infrastructure knows that Nigeria has always adopted the incorrect approach to developing infrastructure.
Fourth, economists and co., do not understand the relationship among the fundamental variables of an economy – employment, productivity and inflation.

To economists, employment is a cost item which use in an economy must be minimized. How, our theory showed that employment is the “blood of the economy.” European and Asian nations achieved modern industrialisation after toiling for thousands of years because they did not emphasize learning (education, training, employment and research) early. Our analysis also showed that nations with large populations can mobilize their entire population for learning and achieve modern industrialization in a few decades. How could economists and co., manage our economies well?

Micro, small and medium scale enterprises (MSME) and entrepreneurship, agriculture do not promote scientific KSCs and reduce unemployment and poverty.

All social scientists claim that it is the MSME that Nigeria must emphasize to promote employment and industrialization. They provide no reason in support of the claim that MSME are promoting employment and improving productivity in the USA, Europe, etc. Our theory of mobilizing a large number of people to promote rapid development automatically warns us to avoid micro, small, small and medium scale enterprises.

If turning-right at a T-junction leads to a desired destination, turning-left at the same T-junction cannot also lead to the desired destination.

The MSMEs are not known to emphasize learning which is the primary source of SEGI. The MSME is not known to do scientific things. Hence, the MSME has no basis for promoting the acquisition of scientific-KSCs and promoting scientific growth and industrialization.

To plan, according to the Advanced Learner’s Dictionary, is to make preparation for something that is expected to happen. We can also define planning as the act of putting together the thoughts and activities necessary for achieving desired objectives. Proper planning must be based on a proper theory, framework and devoid of false and inappropriate assumptions. Otherwise, a nation cannot achieve its desired objectives. What has been the development theory guiding Nigeria’s planning? Nigeria has always lacked a theory of development, a proper planning framework. Nigeria’s development has always been based on fallacious claims.


Culled from TheGuardian

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