Nwodo: Restructuring, agriculture could revive ailing economy

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In a restructured Nigeria, Northern Nigeria with the right agricultural policies will be the richest part of Nigeria

 

Agricultural produce from Northern Nigeria

WITH some developing countries already seeking alternatives to crude oil, and others developing technologies that are not dependent on fossil oil, the world dependence on Nigeria’s crude oil, the nation’s main economic mainstay, “is becoming a rapidly declining phenomenon.”

Speaking Wednesday at the Chatham House, London the Royal Institute of International Affairs, the President General of Ohanaeze John Nnia Nwodo, stated that “Nigeria has a grim economic outlook,” as he recommended restructuring and a return to agriculture to salvage the economy.

In his speech, Restructuring Nigeria: Decentralisation for national Cohesion, as part of a series of discussion on Next Generation Nigeria: Accountability and National Cohesion, Nwodo noted grimly, “Nigeria’s external debt has grown from $10.3 billion in 2015 to $15 billion in 2017. Her domestic debt has also grown from 8.8 trillion Naira in 2015, to 14 trillion Naira in 2017. Domestic debt component for the 36 states rose from 1.69 trillion Naira in 2015 to 2.9 trillion Naira in June 2017.”

With state governments in precarious states, the Federal Government rallied to bail them out with funds to enable states meet their recurrent expenditure requirements.

He noted that, “only about eight states in Nigeria namely Lagos, Kano, Enugu, Edo, Delta, Abia, Rivers, and Kwara have their internally generated revenue sufficient enough to cover their interest repayments on their debts without depending on allocations from federally collected revenue.

“For the Federal Government close to 40% of its annual revenue was spent on servicing interest repayments on debts and, according to International Monetary Fund (IMF), this percentage is expected to increase further. According to Fitch ratings, Nigerian government’s gross debts is 320% of its annual revenue!! – one of the highest in the world.

“In the face of this economic reality, the Population Reference Bureau predicts that Nigeria will in 2050 become the world’s fourth-largest population with a population of 397 million coming after China, India and the United States of America. This is only 33 years away.

“In 2011, five Colonels in the United States Centre for Strategy and Technology, Air War College did a case study on Nigeria and the global consequences of its implosion and came out with a conclusion that, ‘despite its best efforts, Nigeria has a long-term struggle ahead to remain a viable state, much less a top-20 economy.’

“Faced with this grim economic outlook and a structure inimical to growth, what is, therefore, our way forward? Our growth model has to change for us to survive as a country.

“The restructuring of Nigeria into smaller and independent federating units and the devolution of powers to these federating units to control exclusively their human capital development, mineral resources, agriculture and power (albeit with an obligation to contribute to the federal government) is the only way to salvage our fledgling economy. Restructuring will devote attention to the new wealth areas, promote competition and productivity as the new federating units struggle to survive.

“It will drastically reduce corruption as the large federal parastatals, which gulp government revenue for little or no impact dissolve and give way to smaller and viable organs in the new federating units.

“Those campaigning against restructuring in Nigeria have painted an unfortunate and untrue picture that those of us in support of restructuring are doing so in order to deny the Northern States who have not yet any proven oil reserves of the ability to survive. This is unfortunate.

“The new model we propose for Nigeria recognizes that revenue in the world today is promoted by two main sources namely, human capital development leveraging on technology to drive the critical sectors of the economy and agriculture.

“The example of Netherlands in agriculture is also relevant here. The Netherlands is the 18th largest economy in the world. It has a land area of about 33.9,000 square kilometres.

“Niger State, one of Nigeria’s 37 administrative units has about 74,000 square kilometres. Netherlands has over $100 billion from agricultural exports annually, contributed mainly by vegetables and dairy. Nigeria’s oil revenue has never in any one year reached $100 billion.

“Northern Nigeria is the most endowed agriculturally in Nigeria. Its tomatoes, carrots, cabbages, cucumbers, yam tubers, grains, livestock and dairy feed the majority of Nigerians in spite of its huge reserve of unexploited export potentials.

“In a restructured Nigeria, Northern Nigeria with the right agricultural policies will be the richest part of Nigeria.”

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