THE IMPACT OF “CHANGE MANTRA ON ECONOMIC DEVELOPMENT OF NIGERIA

THE IMPACT OF “CHANGE MANTRA ON ECONOMIC DEVELOPMENT OF NIGERIA

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NIGERIA                                                        

                                                              CHAPTER ONE

                                                             INTRODUCTION

BACKGROUND OF STUDY

It is now a glaring fact that so much is happening in the Nigerian polity, especially in relation to economic policy making agencies. This may be partly owing to the pressure of stakeholders at the local and international levels on finding a lasting solution to the current challenges of the Nigerian economy. Declared to be officially in recession a few weeks ago, Nigeria has witnessed a reactive series of policy statements and approaches from different policy making bodies even to the point of creating policy summersault as manifest in the arguments and counter-arguments of decision makers.

In retrospection, the unpleasant fact that was beginning to manifest in recession had hitherto been predicted by renowned economic experts. These experts had been volunteering intermittent opinions on the staggering economic indices and its effect on market forces from the first quarter of 2016. It was however not until the beginning of the third quarter that this bitter pill had to be swallowed, following the indicators by the National Bureau of Statistics which showed Gross Domestic Product (GDP) data of a negative growth rate of -0.36 per cent and the declaration by the Federal Minister for Finance, as well as the Governor of Central Bank. At present, the situation is still unimpressive, with a GDP contraction of about 2.06 percent, an increase in inflation rate to about 17.6 percent coupled with a fall in Foreign Direct Investment (FDI), and an external reserve that is down by 25 percent. Highlighted reasons for the unimpressive indices include the fall in global oil prices from over $100 to below $40, past mismanagement of resources, and ongoing security challenges in the oil rich region, which had led to a reduction in the production of crude oil from the anticipated 2.2 million barrels to just above a million barrels. Invariably, these changes have exerted an overwhelming pressure on the non-oil sector, leading to an increase in gross inflation in the price of goods and commodities, high electricity tariffs, worsening foreign exchange rates, and a commensurate increase in consumer spending, among others.

More pathetic is the fact that many of the recent government policies and actions are yet to translate to a better standard of living and wellbeing at the grassroots level where prices of goods and commodities are still largely on the increase. In a country where Out of Pocket Payment (OOP) remains the common approach to accessing basic services like health and education, these services are forced down the priority lists among the masses to give way to survival, with an attendant rise in ill health and illiteracy, and widening inequality. Therefore, in proffering solutions, it is of utmost importance to analyse how Nigeria as a nation got to this frightful edge. The idea is to use the lessons to chart a way forward for the future.

To start with, documented evidence from other economies has shown that the development of a nation can be affected due to different human errors. The book What Matters Most by Jeffrey Hollender and Stephen Fenichell is one critical collection of events in the western world which chronicles the scandal of corporate global organisations in the Western countries around the late 1990s to about 2002. From the different analyses in this book, one important point that stands out is the singular fact of mismanagement where the primary focus was on increasing profit, even when it involved unwholesome and corrupt practices at the expense of the consumers and society who are also critical stakeholders in the survival of such businesses. These activities eventually led to the collapse of such businesses with an overarching impact on the economy. The writer, in his recommendations, cites ways of preventing such occurrence by providing an alternative business structure where the core values are premised on a triple bottom line of profit making, social protection and environmental stewardship. In his judgement, the writer concluded that the governments’ role of regulating businesses and their operations remain invaluable in promoting accountability and social protection for the citizenry.

With a teeming population of youth among the 170 million people in Nigeria, promoting diversification of the economy through these youths is of critical importance. This can be achieved by providing third tier financial security opportunities, which will reduce the requirement for loans and credits for these start-ups, especially at the grassroots level.


Bringing this scenario to the Nigerian situation, it will be very apt to say that the recession miasma which Nigeria unfortunately finds itself in is a product of long years of mismanagement, inefficient management and use of national asset, and poor regulation in the areas of businesses all over Nigeria. More unfortunately, these vices take their roots in an endemic case of inequality which has led to the exclusion of a lot of stakeholders in the development of a promising and productive country. As such, the long term effect of inequality has also permeated the social enterprise sector where not for profit organisations, academic institutions, as well as religious institutions belong.

In other words, the core values of accountability, transparency, and sustainability that qualify social responsibility of individuals and societies have been eroded. Such implications have thus metamorphosed into social issues where these neglected stakeholders react in the form of militancy in the oil rich region, kidnapping, religious insurgency, a poorly motivated work force, the widespread lack of patriotism, among others. These implications have now contributed greatly to the loss of social capital, which is an important facilitator of wealth generation in any country where development is a priority.

It’s yet another critical period for Nigeria as we run through the last quarter of 2016, which also coincides with the period in which awareness of the new national orientation slogan of ‘Change begins with me’ is in top gear. It is very instructive that this slogan may be driven to create a new Nigeria where inclusion of all Nigerians is seen as the operational term to develop our public and social goods. The objectives of this slogan can effectively be achieved when policy makers become sincerely committed to the achievement of the Sustainable Development Goals whose main focus is on collaboration of all stakeholders from the national level down to the grassroots. Policy makers are thus saddled with the responsibility of using this witty slogan to advocate for the creation of social capital where all Nigerians are made to see the unity and development of Nigeria as important goals. However, this change has to be seen to emanate from them first in terms of adjusting the apparent mismanagement of national wealth, especially by the political class. Other recommendations include:

• The promotion of internally facilitated survival strategies which will redefine business relationships in Nigeria, especially among the youth. With a teeming population of youth among the 170 million people in Nigeria, promoting diversification of the economy through these youths is of critical importance. This can be achieved by providing third tier financial security opportunities, which will reduce the requirement for loans and credits for these start-ups, especially at the grassroots level. An enabling environment in terms of the ease of doing business will also help attract Nigerians in the diasporas and create confidence in the hearts of potential investors.

Some of the highly needed social interventions include: a financial relief scheme such as health insurance, education discount and waivers, provision of financial security for small businesses, promotion of community development projects that create export business opportunities for the community dwellers.


• An improvement of governance in the area of regulatory responsibility in products and services standardisation in Nigeria. As a matter of extension, community relations, consumer protection, which put public good at the core, should also be given national priority, while ensuring that sanctions are stated out for non-compliant businesses. This, however, has to emanate from the leadership, where public office holders are held to perform on standards. Policy makers should also establish different engagement platforms that will facilitate the harnessing of ideas from citizens in facilitating sustainable national growth.

• A realisation that economic policies are better discussed with the inclusion of basic social services like health, and education. The different economic policies will only be meaningful to the average Nigerian if there is a direct impact on his quality of life. Thus, intervention in the areas of health, education, and social development, in line with economic strategies, will help reduce burden and improve top-bottom relationship. Some of the highly needed social interventions include: a financial relief scheme such as health insurance, education discount and waivers, provision of financial security for small businesses, promotion of community development projects that create export business opportunities for the community dwellers

STATEMENT OF PROBLEM

In the economic front, the Buhari administration has a myriad of challenges to tackle which include, but not limited to, pervasive poverty, rising unemployment, epileptic power supply, fuel crisis and declining economy.

Pervasive Poverty: Pervasive poverty and massive unemployment are serious economic challenges facing Nigeria. Both have maintained a rising trend over the years. Poverty rates remain high in Nigeria, particularly in rural areas. It is estimated that 110 million out of Nigeria's population of 170 million live in "extreme poverty". Of the 110 million Nigerians suffering from extreme poverty, majority are young people denied of employment opportunities. 

Rising Unemployment: About 23 per cent of adults and 60 per cent of youths in Nigeria are unemployed. Unemployment rate in Nigeria increased from 12.3 per cent in 2006 to 23.9 per cent in 2011. As at first quarter of 2015, unemployment rate in Nigeria reached an all-time high of 24.20 percent. With a youth unemployment rate as high as 50%, these young Nigerians fell prey to recruitment for groups such as Boko Haram. The problem of poverty and unemployment in Nigeria results from inconsistent policies, misappropriation of funds for empowerment schemes and increasing de-industrialisation and collapse of small businesses due to poor power supply.

Electricity Shortage: Inadequate and unreliable electricity supply is another critical challenge that the new administration of President Buhari has to tackle if Nigeria is to enhance the standard of living of the citizens. Despite spending about US$20 billion in the last 16 years on the electricity sector, Nigeria is only able to generate 4,000 megawatts of electricity for a population of over 170 million people. In contrast, South Africa with a population of 52 million people generates 44,000 megawatts. Consequently, households, private establishments and government offices rely on generators with the attendant operational, maintenance and health costs. Policy inconsistency, non-availability of gas, infrastructure vandalisation, and sabotage are some of the reasons that have contributed to the failure of the power sector. Consequently, per capita electricity usage in Nigeria remains 136 kilowatt/hour, which is one of the lowest electricity consumption on a per capita basis in the world. This situation is made worse by lingering fuel scarcity, further reducing the opportunity for small and medium scale enterprises to leverage on generating sets for alternative power supply.

Heavy Dependence on Oil: A major issue for the new administration of President Buhari is the over reliance on crude oil export. Since the 1970s, oil revenue have accounted for 80% of revenue and 95% of export earnings. Oil export has contributed substantially to the revenue base of Nigeria but has entrenched a mono-cultural economy. Regrettably, other critical sectors such as agriculture and manufacturing, have not been given much consideration by successive administrations. The manufacturing sector’s share of gross domestic product is under 4% while over 80% of manufactured goods in Nigeria are imported. Consequently, declining global oil prices have reduced the fiscal buffers of the Nigerian economy and constrained government’s ability to meet its obligations, including paying salaries and debt repayment.

Nationwide Fuel Crisis: Despite being Africa’s top oil producer, Nigeria heavily subsidises imported petrol and kerosene for the bulk of its domestic demand. Its huge reliance on fuel import is due to an underperforming refining system. Fuel crisis in Nigeria significantly stifles economic activities with consequences for national development and security.

RESEARCH OBJECTIVES

1.      The effect of “change” mantra( President  Buhari’s change reform) on economic development of Nigeria

2.      The effect of President  Buhari’s change reform on socio-economic stability

3.      The effect  of President  Buhari’s change mantra on the fight against corruption

4.      Problems militating against effective implementation of President Buhari’s change reform

RESEARCH QUESTIONS

1.      What is the effect of “change” mantra( President  Buhari’s change reform) on economic development of Nigeria?

2.      What is the effect of President  Buhari’s change reform on socio-economic stability?

3.      What is the effect  of President  Buhari’s change mantra on the fight against corruption?

4.      What are the problems militating against effective implementation of President Buhari’s change reform?

RESEARCH HYPOTHESIS

H0; There is no significant relationship between president Buhari’s “change” reform and economic policy

H1; There is a  significant relationship between president Buhari’s “change” reform and economic policy

SIGNIFICANCE OF STUDY

This study stand as an assessment on the Nigeria current government( Buhari’s lead administration).The study used public opinion to assess president lead administration popularly known as the change era, to see if his campaign promise has been at least 70% fulfilled before his current administration elapses.

The study will also provide answers to reason why the APC “change” motto has not been felt positively and also the study will be useful to the current Nigeria government to check loopholes and defaulted area which has made the current administration to suffer setback

The study will also be useful in contributing to existing knowledge and also to be use as a reference to related works.

SCOPE OF STUDY

The study analysis will be base on the current “change” era of the federal republic of Nigeria, which is headed by His Excellency, President Muhammadu Buhari, the president of Nigeria. The study will look into his administration which he called “CHANGE” and to analyse it by using public opinion and content analysis on whether he has been successful in his CHANGE reform or not.

DEFINITIONS OF TERMS

Change ; to make the form, nature, content, future course, etc., of (something) different from what it is or from what it would be if left alone: to change one's name; to change one's opinion; to change the course of history.

Mantra; an often repeated word, formula, or phrase, often a truism

Economic development; Economic development is the process by which a nation improves the economic, political, and social well-being of its people. The term has been used frequently by economists, politicians, and others in the 20th and 21st centuries.


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