THE ECONOMIC GAINS OF NIGERIA UNDER DEMOCRATIC RULE.
By: Udo Etefia
Nigeria blessed with abundant natural resources is the 12th largest producer of petroleum in the world, the 8th largest exporter of the product and has the 10th largest proven reserves. This is aside from other natural resources which abound in all parts of the country.
Before the discovery of crude oil in Nigeria, products such as palm oil, groundnut, cocoa and cotton were the major economic driving force.
The Nigerian economic development was so promising at independence that the world predicted that in less than twenty years, Nigeria was also going to be among the biggest economies of the world. Nigeria was rated on the same level of development with countries such as Brazil, India, Malaysia and Indonesia as countries that will join the big economies of the world.
However, the long years of military rule and its attendant corruption and mismanagement set the hand of the clock backward in virtually all sectors of the economy. The restoration of democratic rule on May 29, 1999 and the subsequent economic reforms seems to have brought Nigeria back towards realizing its full economic potentials.
The administration of Chief Olusegun Obasanjo, realized soon after assumption of office in 1999 that public owned companies have been serving as conduit pipes for siphoning public funds. The government then decided to implement the privatisation programme which made industries, which had hitherto been enjoying government monopoly, to be privatized while others were opened up for private sector participation.
The liberalization policy brought a revolution in the telecommunications industry where the sector received an unprecedented boost making it the fastest growing in Africa. This is manifested in the astronomical increase in the number of telephone lines from 450,000 lines in 1999 to the current 80 million lines. The sector has also attracted a whopping 18 billion dollar private investment including foreign direct investment.
Twelve years of democratic environment in Nigeria has also provided the needed impetus for reform in the banking sector. It began with the 2004 banking sector reform aimed at establishing a reliable and efficient banking system that would guarantee the safety of depositors’ money. The reform which raised the capital base of banks to 25 billion naira was designed to ensure that the banks were better positioned to finance the industrial sector.
It is generally believed that the banking sector consolidation shielded the industry in Nigeria from the 2008 global financial melt-down which saw the collapse of a number of strong banks in more advanced countries. The reform of the sector is still on-going with the current sanitization programme of the Central Bank of Nigeria which has revealed some excesses by some operators.
With a democratic environment, the needed legal framework has been provided to deal with the problem of corruption, which has impeded development over the years. For instance, the bill establishing the Independent Corrupt Practices and Related Offences Commission (ICPC) was among the first set of laws sent to the National Assembly by the Obasanjo administration on assumption of office in May, 1999. This was later followed by that of the Economic and Financial Crimes Commission (EFCC).
The battle against corruption has recorded tremendous gains with the successful prosecution and conviction of some high profile politicians and businessmen in the country thereby recovering and retrieving stolen public funds.
In 2007, the administration of late Umar Yar’Adua launched the Vision 20:2020, aimed at launching Nigeria onto the path of sustained and rapid economic growth so that the country could become one of the top twenty economies in the world by year 2020. The strategy advocates integrated sectoral planning to enhance linkage and synergy. This is to ensure that agriculture, oil and gas as well as mineral sectors serve as sources of inputs into the nation’s local manufacturing industry.
In 2006, Nigeria made history by becoming the first African country to completely pay-off its debt owed to the Paris Cub estimated at over 30 billion dollars. This has helped the country to free-up at least 1.15 billion dollars annually for poverty reduction programmes.
Today, Nigeria is now the second largest economy in Africa after South Africa and the largest economy in West Africa.
Just like his predecessors in the current democratic process, President Goodluck Jonathan has made the economy the cornerstone of his administration and has given top priority to the power sector which is the catalyst for achieving set economic goals.
With all these in place, it is expected that by 2015, Nigeria would have been on the right track towards realizing its target of being one of the top twenty economies of the world.
Broadcast on Tuesday May 24, 2011 |
