Need for a workable development framework
Nigeria equally adopted the Keynesian model of development which centered on active participation of the government in managing the economy; and with huge oil revenues, she went on to establish parastatals in almost every sector of the economy.
These parastatals performed woefully as they were dependent on government patronage for survival. They gulped billions of naira in overhead costs and salaries, yet they were largely inefficient in service delivery. They became a huge drain on government revenue, contributing little or nothing to the nation’s GDP. In the wake of dwindling government revenue occasioned by the oil glut, the government set up a Study Group to rationalise the operations of these parastatals. It opted for privatisation which was predicated on deregulation, liberalisation, financialisation and commercialisation.
The economic philosophy underpinning privatisation was predicated on the neoliberal development orthodoxy, which elevated private sector participation and finance capital to unprecedented heights, even when our political culture negates economic development.
Prior to privatisation, government had tinkered with the idea of the Structural Adjustment Programme (SAP) imposed on the nation by Bretton Woods’ World Bank/ IMF. SAP was conceived as a policy prescription for economic re-engineering and the attainment of double-digit growth. SAP was equally designed to catalyse the inflow of foreign investment, technology and global partnerships; and rather than transform the economy by way of diversifying the economy and achieving macro-economic stability, SAP undermined the nation’s economy. It impoverished Nigerians by worsening their socio-economic conditions with poverty becoming pervasive; the middle class was almost wiped out; thousands of jobs were lost; many industries folded up; coupled with the astronomical rise in the prices of essential goods and services.
The economy was stagnant, growing at 2.2 per cent throughout the 1980s and 1990s; it was only with the inception of democratic dispensation in 1999 that economic growth began to average six per cent of GDP; yet, growth has not catalysed structural transformation and make an impactful dent on poverty reduction. Nigeria remains a consumer nation, contributing practically nothing in terms of manufactures to global trade; and worse still, Nigeria remains fuel and food import dependent, with trillions of naira spent on foreign exchange.
Agriculture and industry remain in a comatose state – unable to add value to the GDP through the fostering of linkages and integration within the economy, with regard to the establishment of more industries, wealth and job creation. As a developing country in dire need of overcoming the challenges of under-development, Nigeria’s monolithic economy is an obstacle to the diversification of the economy and the achievement of massive industrialisation. Reliance on oil revenue constrains economic stability and planning as well as the funding of development programmes; and oil price fluctuations impact negatively on the budget, creating budgetary deficits that must be financed by borrowing from domestic or foreign sources.
The other alternative left for funding development programmes is to depend on Official Development Assistance (ODA) or to borrow from domestic or foreign sources. On ODA, the spate of bad governance, insecurity and corruption have vitiated the chances of inflow from Nigeria’s development partners as there is no guarantee that borrowing will be transparent, accounted for and impact positively on the implementation of development programmes.
Nigeria’s development challenges are compounded by her technological backwardness. Despite earning as much as $300 billion as at the year 2000, poverty is still endemic with the poverty rate estimated at 70 per cent of Nigerians living below one dollar a day. The overwhelming number of Nigerians wallowing in poverty has plunged the nation into a deluge of rising crime rate, insecurity, killings, kidnappings etc. The negative impact of these social vices is detraction from the nation’s development efforts.
Nigeria could be apologetically regarded as a failed state; steeped, as it is, in a plethora of unresolved socio-economic problems –unemployment, infrastructural deficit, corruption, lack of economic development, technological backwardness, ethnic nationalism and nepotism, endemic poverty, child trafficking, kidnapping, oil theft, fuel importation etc. It is high time Nigerians reviewed its policy prescriptions to redeem the lost decades and reposition Nigeria on the path of growth and sustainable development. For too long, our government has acted capitalistically, allowing the World Bank and IMF to usurp our thinking faculty as if we are in deficit of intellectual giftedness. For too long, we have refused to be strategic and innovative; while our sense of dignity has been inferiorised by western values. The imperative of overcoming the challenges of under-development calls for the institutionalisation of a developmental state that is predicated on visionary leadership, good governance and civil society participation in public policy formulation and implementation.
The implication of the failure of the neoliberal orthodoxy is that there is need for a new development framework that is indigenous and less exogenous. If the development of the Asian Tigers is anything to go by, Nigeria must focus on four critical areas of development – wealth creation, infrastructure, technological capability and human development. Above all, the leadership elite must be willing to undergo moral and attitudinal revolution that is anchored on discipline, equity and commitment to the common good. Nigeria must reclaim its lost glory among the comity of nations.
•Nwogbo, PhD, works with the National Open University of Nigeria, Abuja.