Opinion
By Bunmi Makinwa
The largely deserted streets of cities in Lagos may give the impression that the population of the city is decreasing. Ditto for Abuja.
Wrong.
There is to date no part of the country where the population is decreasing, according to available data.
Current projections indicate that Nigeria’s population currently ranked as the seventh most populous country in the world with approximately 230 million people in 2024, will increase to 377 million by 2050, making it the third most populous country.
Due to the prevailing hardship, a significant portion of the population is staying indoors, primarily idle. In Abuja, Lagos, and in other state capitals and urban areas the micro, small and medium scale enterprises, which serve as the economic drivers for the population, have either decreased in number or halted their operations.
The ability of many Nigerians to engage in their usual daily movement outside their homes to source their means of livelihood has reduced drastically. In simpler terms, life has become so expensive that people stay home to reduce costs and avoid expenses. Prices are high, sales are lower. Income and capacity to earn have been eroded.
Nigeria recorded a trade balance of N6.5 trillion in the second quarter of 2024. Exports accounted for 60.89 per cent of total external trade. Imports are declining.
Dependence on oil as main source of revenue and exports has shifted positively. In the third quarter of 2024, the non-oil sector including telecommunications, trade, agriculture, financial and insurance, manufacturing, construction, and accounting contributed positively to the country’s GDP growth of 3.46 per cent in the third quarter of 2024, higher than the 3.2 growth rate of the previous quarter.
This is all good news. If the trajectory continues, Nigeria’s economy may start witnessing positive development.
Side by side, inflation in Nigeria rose from 18.8% in 2022 to 24.5% in 2023. Nigeria’s unemployment rate is 33.3%, and the youth unemployment rate is 42.5%.
The poverty rate in Nigeria has risen by about 6% in the last two years, and an estimated 87 million people live below the poverty line. This makes Nigeria the world’s second-largest poor population after India.
Nigeria is undoubtedly going through a most dire economic situation and people are suffering immensely. This has been acknowledged by the government at various levels.
The trajectory of economic and its concomitant social hardship started many years ago and has continued through all past governments. They result from leadership deficiencies, poorly conceived policies, bad governance, fundamentally dysfunctional political system, massive corruption in the public sector, banditry and insurgency, ineffective and costly infrastructures, among others.
Also, several global factors such as the Covid 19 epidemic, wars and regional instabilities, oil price fluctuation, and highly expensive imports have worsened the economic conditions of African countries, including Nigeria.
The immediate causes and what have brought about more massive and harsher poverty are attributable directly to the recent removal of subsidy on petrol and related products, floating of the Naira exchange rate and increase of tariffs and charges on electricity, as well as higher duties and taxes.
These policies have direct effect and impact on all productive activities, hence consumers have to bear the increased burden either wholly or in part. But there is a limit to what weight consumers can carry.
The measures taken by themselves were probably necessary for the recovery of the economy. But the timeliness and combined implementation of the policies have been disastrous. The mitigating actions taken to soften their impact by federal and state governments have not yielded expected results in a timely way, nor at the scale that is required to show impact.
The current President came in seemingly ready and well prepared. However, his so-called bold reforms are not accompanied with the necessary reliefs. The negative burden of the reforms is huge.
What should be done?
Immediate and short-term actions to reduce the level of hardship of the population are imperative.
The gap between the overwhelming majority of people who are struggling perpetually to survive and the political leaders who live openly in over-abundant wealth must be lessened. In kind, words and actions. This vital step addresses both reality and perception. It is the most important change that can make manifestly clear that the leaders of the country listen and respond to the people.
The President, governors and all political institutions must take drastic decisions to adopt a new modus operandi of “less and less” in lifestyle, management, and programmes. Less opulence. Less ostentation. Less income. Less allowances. Less corruption etc. And openly too, whilst acknowledging the federal system of government with decentralized authorities and responsibilities.
The political and governance structure should be minimized but such a fundamental transformation cannot be achieved as an immediate and short-term action. It needs to be done in the long run.
Here are five other immediate and urgent steps for the political leadership to consider:
1. Manifestly lower expenditures of the President and presidency, and the Governors. Use the savings to create additional jobs, and more business ventures for young people.
2. The All Progressives Congress (APC) as the lead political party must mandate a reduction of budgets for “non-essentials” by all its elected political leaders including Governors, Senators, Representatives, Members of Assembly and party officials. New budgets that confirm the reduction and show the savings made should be in the public domain.
3. Reduce taxes, duties and charges on basic equipment and materials for sectors that drive the economy such as agriculture and construction. Also, stop or reduce income taxes for the most vulnerable and least paid workers at least for a period of time.
4. The President, and Governors especially should make statements or speak publicly at least once a month on steps that are taken to improve the economy to benefit the average citizens, bring down poverty, create jobs and provide incentives to small businesses.
5. Manage and stabilize the exchange rate of the Naira for the next five years.
Going forward, new official policies or decisions should be rigorously studied, tested and their near and farther implications should be fully understood before being adopted or implemented. Some of the newly established national policies in fact contradicted or neutralized each other in implementation when the intended results were to improve socioeconomic situations.
***Bunmi Makinwa is the CEO of AUNIQUEI Communication for Leadership
5th December, 2024.C.E
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