As Nigeria turns 58 today, I want to dedicate this week to addressing the question of economic growth, while debunking a major myth that has kept us bound and underachieving for many decades.
Since my secondary school days in the eighties, I kept on hearing statements like the Nigerian economy is 75% dependent on oil. This famous cliché about the Nigerian economy has grown over the years, so much that when everything changed about the Nigerian economy, nobody seemed to take notice. People continued to make ungrounded claims without bothering to do any research or investigation, on the subject matter.
It becomes even more alarming, when government officials, ministers, members of cabinet, parliamentarians, make such ungrounded and uneducated claims. Having lived outside of Nigeria for the past 30 years of my life, I am always amazed at the ignorance of an average Nigerian about their country.
The level of self-bashing and tongue lashing by Nigerians about themselves and their country is simply disgraceful. I actually think we are the ones who give outsiders the wrong impression that Nigerians are evil people through our negative talk about our country.
I don’t know about you, but from my own interactions and knowledge of Nigerians, I think it is a wrong notion to think that Nigerians are mainly bad people. Personally I have met overwhelmingly greater percentage of good Nigerians as against the bad ones. In my own experience, the ratio would be 95:5. Meaning 95% good, 5% bad eggs.
“A man’s stomach shall be satisfied from the fruit of his mouth; from the produce of his lips he shall be filled. Death and life are in the power of the tongue, and those who love it will eat its fruit.” Prov. 18:20-21
If we are to relate the above scripture to a nation, it would probably read somehow like this “A nation’s destiny, shall be gratified by the words of her citizens. With the produce of their lips, a country shall be filled.”
From this my paraphrase, we could go further to expantiate that the destiny of each nation is shaped by the words coming from the mouth of her citizens. This means that it is what we mainly speak, good or evil about our land, that our land produces and becomes. Our words, attitudes and actions produce the fruit that litter the nation. That is according to verse 20 of proverbs 18.
This lesson from the wisest man that ever lived, King Solomon, becomes much more vivid in verse 21. Death and life are in the power of the tongue. However, to me the second part of that verse is the most telling “and those who love it will eat its fruit.” Meaning those who love to speak evil will definitely be fed by the fruits of evil, those who love to confess death shall eventually reap death. The opposite is also true. Those who love to speak and confess life would reap the fruit thereof. Those who proclaim good and only good about themselves and their nations, will inherit good.
What a stunning submission, both death and life are in the power of a man’s tongue. He himself, determines what he fills his life, his family, his nation and his destiny with. My fellow Nigerians, let us chose life. Let us begin to speak the truth about our country. Let us begin to speak life upon our nation!!!
Coming back to the question of if Nigerian’s economy is 75% dependent on oil or not, this is not true! But if you go across Nigeria today and conduct a survey, an overwhelming majority would probably tell you, yes, this is true. Thereby using this claim as the basis for bashing the country, tongue lashing about how much we have failed as a nation.
Yes, we have failed in a lot of ways as a nation and I would be the first to admit it, but our submissions must be factual and truthful. I would not have any issue with this statement about Nigeria been 75% dependent on oil, if it were true because the truth must be our only basis for action.
So what is the truth about the statement of Nigeria being 75% dependent on oil? The truth is that Nigerian economy is not 75% dependent on oil. We were only 14% dependent on oil as of 2012 statistics. But after the rebasing of the Nigerian economy, oil’s contribution to our economy has been reduced to only about 8%. (2014).
So why do most people say, our economy is dependent only on oil? I think the problem is actually with our surface thinking and lack of analysis. Majority of Nigerians, don’t analyze, we don’t carry out research or scientific investigations. The majority of our populace, mainly depend on gainsaying, we don’t do our own due diligence.
The truth is that the Nigerian economy gets 75% of its foreign exchange earnings from the export of oil. That is to say the income the country gets from all our exported commodities places oil as our main export product. As a result, 75% of our foreign exchange earnings come from oil, not 75% of our economy. If we are to compare everything we earn from oil and put it on one side, it would only amount to 8% of the amount of money our economy generates.
That is a total departure from the impression that is been created by most people who say we are 75% dependent on oil. Having gotten the right picture that we actually produce as a nation 92% more wealth than oil. The question that arises therefore is, why are we not exporting this produce for foreign exchange earnings?
There are many reasons for our dependence on oil for foreign exchange earnings:
- The biggest chunk of our economy is agriculture, mainly consumables, rather than exported.
- For us to export our agricultural produce, they must be of the highest quality to compete with the best in the world.
- If you are a business man and you are producing anything, it is easier for you to sell them in Nigeria than outside, because the quality has to match the international standard.
- It is not just the quality that must be good enough, but your price must be competitive enough for you to sell your product outside of your country.
- We mainly export oil because we abandoned our main export industries before. Examples: palm oil, cocoa, groundnuts, timber, cotton, etc.
What can we do to break our dependence on oil for foreign exchange earnings bearing in mind that oil prices are falling fast? The demand for oil is diminishing all over the world. Developed countries are finding alternative sources of energy. The Nigerian oil reserve is not indispensable, we are running out of oil. How can Nigeria keep on earning foreign currency from other sources?
- So many states in Nigeria are trying to go back to this old foreign exchange earners as I mentioned above: palm oil, groundnut, cocoa, timber etc. many states are making a lot of effort to revamp these industries for foreign exchange earnings.
- The old export we had that earned us foreign currencies are mainly natural resource based, oil, palm oil, cotton, timber, etc. I call them old school products. There are many more raw materials in Nigeria apart from oil that could be exported for foreign earnings. Many of our government ministers are still hoping to use raw materials to get us more foreign currency. I believe this is old school thinking.
- The only case where we could use raw materials as foreign exchange earners, is only as a temporarily relief measure in transitioning from oil to other future produce.
- Raw materials like uranium, colombite, tin, coal, and textile could earn us as much as we are presently earning from oil.
My personal opinion is that any form of reversion to raw materials as a means of foreign exchange earnings for the country is counterproductive. I think the way to go is to encourage our young entrepreneurs to produce products that will be better than other country’s produce. The 21st century world would no longer depend on natural resources. It is indeed old school.
Let me therefore suggest what I believe could be the real answer to our foreign exchange earnings going forward. It is what I call the futuristic businesses and leaders. I would advocate we go for 21st century produce, goods and services that are in demand in every country of the world.
Thank God we already have some futuristic business gladiators in our country. These men are seeing into the future. I am proud of them. It is clear they know what they are doing. Our government must get behind these men to give them all of the support they need. Through their proactive business approach we could soon forget that we use to look up to oil for foreign exchange earnings.
- Dangote is a futuristic thinker. His target is export of finished products for foreign currency, not natural resources, but industrial products. Bravo, Mr Dangote!
- Dangote is already putting Nigeria on the world map. His efforsts would soon begin to earn much more foreign exchange earnings to Nigeria. He wants to make Nigeria one of the leading exporters of industrial products like cement, rice, salt, oil products etc. Again Kudos, Mr. Dangote!
- Michael Akindele is a young man of the future. He produces mobile phones and other mobile devices that are already overrunning apple, Samsung, Nokia, etc in Africa. Can you believe this? These are Nigerian brand mobile devices. That is a better foreign currency earnings for Nigeria in the 21st century. We better support men like this to make the Nigerian brand go viral. That is where the government money should go.
- Innoson IVM, owned by Chief Innocent Chukwuma, the first indigenous manufacturer of 100% Nigerian made vehicles. He is a man of the future. That is a better foreign currency earner for the country in the future. The government has to put money behind him to produce enough to export to as many countries of the world as possible.
- Taofik Okoya is a man of the future because he is running the US Barbie Company out of Africa. He is a man of the future. That is a better way to earn foreign currency. If only the federal government would find it necessary to put their weight behind him.
- The leaders of our new generation Banks, First Bank, Zenith Bank, Guarantee Trust Bank, United Bank of Africa, Access Bank and Eco Bank are men of the future. These banks alone could turn Nigeria into the financial hub of Africa. However they too would need the support of the government to move up the ranks of international banking.
- Inye, by Encipher, is Nigeria’s first Tablet PC. It was designed in 2009 by Saheed Adepoju who developed an android software, but could not find a suitable device to test it. People like Adepoju badly need the help of the federal government to going global. His tablet PC could easily compete with Ipad, Samsung and other imported devices, and outperform them in Africa. That is a sure means for foreign exchange earnings.
What are the other means of earning foreign currency apart from oil and the above mentioned points?
- DIASPORA: It has become the second largest contributor to Nigeria’s GDP in foreign exchange earnings second only to oil, 21 billion USD. Moreover Nigerians in diaspora are now number 3 overall contributors to Nigeria’s GDP, trailing only Lagos and Rivers State. Lagos state contributes to the Nigerian GDP over 40 billion USD according to the 2013 statistic, Rivers state 22 billion dollars, Diaspora 21 billion USD. I personally feel we must establish a ministry of Diaspora and integration. If we give the diaspora the necessary support the 21 billion USD they are sending now could easily be multiplied 10 times giving us a yearly foreign exchange earnings as big as the size of the budget of Russia or France.
- Another source of foreign currency earning could be identified as economic zones. I personally believe that the federal government should turn places like Aba, Onitsha, Lagos, etc into special industrial hubs. I would like to call on the government to try and create special incentives for this young Nigerians who are producing, shoes, bags, clothes, jewelries and other The Nigerian government should invest in the expertise of this young men. The government needs to put money into helping them become competitive enough to at least take over the African market. That would earn us a lot of the foreign currency that is going from Africa to Europe.
- I believe we could easily compete with Asian Tiger countries that major in the mass production of soft industrial products like: slippers, socks, underwear, T shirts etc. Looking at all the boys struggling to sell their products in Lagos traffic during rush hours, we know that we have a huge resource there. We could put money into all these young people for a mass production of such products for export. Take them off the streets where they are presently constituting a nuisance and empower them to make products good enough for at least the African market. There lies our foreign exchange earnings.
- One of the very strong areas of foreign earning for Nigeria could be, investing in young minds, young scientist, and researchers. Nigerians are very creative and if we get behind our young men with brains, we could have a lot of products coming out of Nigeria that are not in any other part of the world. That would surly bring us a lot of foreign exchange earnings in the long run.
- Nigeria is the most populous black nation in the world. It is said that 1 out of every 5 black people you meet is a Nigerian. To me that is already a source of foreign exchange earnings. We could turn every Nigerian into a tourist ambassador to bring in foreigners with their foreign currencies to our country. More so if 1 in every 5 black men is Nigerian then we could provide services to other African countries purely coming from our size and number. Thereby earning some more foreign exchange. That is what China, India, USA, Russia are doing all over the world. Size matters!
- Nigeria could follow in the example of India that is having a huge percentage of their GDP coming from IT specialists. We could put money into encouraging our young people to study computers and convert all those people who are now engaged in internet fraud to use their skills for legal computer expertise that could become a big source of foreign exchange earning to the country.
- I personally believe that the new Nigerian government should do what President Obasanjo did by identifying macro business men who are able to lead multinational companies. Nigeria needs to intentionally begin to raise up multinational companies that would be able to build products across all continents of the earth. Companies like McDonalds, General electric, General Motors, Hilton Hotel, Coca cola, Microsoft, Apple, etc. the only difference is these companies will be coming from Nigeria.
Dear friends, the point that I am trying to make in this article is that, we should see Nigeria and her economy the way it is. I am not saying we should paint a picture that is not realistic or tell lies about our prospects. But I also don’t want us to reduce our significance and potentials through inaccurate statements and utterances.
In the world today, Nigeria is seen as an emerging market country. It is estimated that between now and 2050 Nigeria would be the number one country in growth rate of the economy. Standing a good chance of overtaking countries like Britain, France etc.
It is important that all Nigerians know that thanks to the economic policies of President Obasanjo’s regime from 1999 to 2007, Nigeria’s economy is no more 75% dependent on oil. Yes, our foreign exchange earnings is still 75% dependent on oil but we can fix that. That is what I am trying to point out in this article.
It is important for me that Nigerians speak the truth about their nation, because if they are only hearing negatives and evil reports about the country, the natural response would not be to stay and build, but to escape and run away. There would also not be incentives for the diaspora to want to come back.
This is especially important now for Nigerians to get the right picture of their country and her prospect in global economy, knowing that there is presently a big dip in the prices of oil. Some Nigerian’s may begin to panic thinking we are doomed as a nation, because of the fall in the price of oil. No, no, no, we are not doomed. Oil is only 8% of our economy. Nigeria has a great future, with or without oil.
For more information on how Nigeria’s economy can become the best in the world check out the book I published on the subject titled –
“The Nigeria Economy: The Way Forward: Taking Nigeria from economic recession into global economic dominance”
Click on the links below for your preferred choice
FOR THE LOVE OF GOD, CHURCH AND NATION
By Pastor Sunday Adelaja.