By Tony Manuaka
At the last count, no fewer than 5,000 recommendations have been made to the federal government by successive Nigerian Economic Summits in the last 15 years. The summit is a platform for public-private sector dialogue. Last year at the 14th edition, stakeholders in the Nigerian economy, including the international community, gathered as usual to examine the realities and the possibilities of making the country one of the top 20 economies of the world by 2020.
After thorough examination of the great potential of the nation, the consensus was that such aspiration was realisable. Then, certain basic conditions for the realisation of the dream were put on the discussion table. One of it was that Nigeria needed to raise the size of its economy from about $170 billion to $900 billion by 2020. That is a five-fold increase in about 12 years. To illustrate the possibilities, ready examples of countries that achieved similar feats were given as Angola, a small African country, which raised the size of its economy, almost ten-fold in a decade; and China, a leading country that increased the size of its economy, fourfold in a decade.
The enthusiasm seemed to know no bounds among optimists. Pointedly, Sam Ohuabunwa, chairman, Nigerian Economic Summit Group, NESG, in the final presentation of the summit`s recommendations, beckoned on President Umaru Yar`Adua to “engage the right people; empower them; and hold them accountable for performance”. He went further, alerting the President that the next summit will be one for appraisal for stakeholders in the Nigerian economy; and will seek confirmation of how the nation has fared. Today the result does not seem to be much to cheer about. By the middle of 2009, many of the stakeholders had become lethargic about the journey towards Vision 2020. They had good reasons to do so. Government could not sustain the enthusiasm. For many the implementation process has been embarrassingly slow.
But in all, Ohuabunwa, says government has been fair in implementing the recommendations of previous economic summits. He believes that the overall direction has been accepted by the government but the same can not be said of the speed of response. For instance, the pace at which government is going about key issues in the economy like electricity, roads, privatisation and the deregulation policy is worrisome. The NESG chairman told the magazine that whereas government claims it has invested so much in power, roads and airports, so much more still need to be done. Apparently, the investment so far made by government in these areas need to be complimented by private sector initiatives. However, the enabling environment for the entry of private sector investors has not been created. A typical example is the failure of the Nigerian Investment Promotion Council, NIPC, to function as a one-stop institution that it is expected to be. This could be another great challenge for this year`s summit.
Aside from taking stock of what has been achieved over the years, this year`s summit will be looking in another direction. The magazine gathered that after very extensive consultations with corporate members of the NESG as well as different arms of government, organisers of the summit resolved to take a look at the scorecard of Nigeria`s economic progress and come up with fresh ideas on how to bridge the implementation gaps.
“Of all the things we have been saying in the past 15 years of the summit, what has been done, what remains to be done; what do we need to do, to bridge the implementation gaps”, says Frank Nweke Jnr., director-general, DG, NESG, remarking further that the problem with the country is not knowing what to do but actually doing what needs to be done as quite a lot seem to have been done but maybe not as much as expected.
Along the same line, Shamsuddeen Usman, minister for national planning, affirms that “we intend to use the opportunity provided by the summit to examine the extent to which implementation of policies, projects and programmes as distinct from their formulation has constituted a drag in our development process”. The minister also says the summit will provide a unique opportunity for critical examination of past implementation against the background of the demands of becoming one of the top economies in the world in the years to come.
One agenda, which this year`s summit will be exploring towards realizing some of the nation`s long-term aspirations, is diversification of the economy. Just as it did last year, the summit will focus on developing the agricultural sector, which experts say is the largest contributor to the national gross domestic product, GDP, and the largest employer of labour in the country. Nigeria is known to be blessed with fertile soil, good climate and desirable rainfall. In addition, government provides fertilizer in the course of the farming seasons. Yet, many Nigerians in both public and private sectors show very little interest in exploring opportunities in the sector.
“The opportunities are tremendous. But do people understand this? If you ask a young graduate to go into farming, he will abuse you, because people think it is something you have to do in tattered clothes. But go to Songhai farm in Kwara State, it is done in a profitable manner, in a respectable manner. These are the things the economic summit will address and actually encourage people to do”, Nweke told the magazine.
Getting government to implement the recommendations of the summits has been a great challenge. Over the years, profound recommendations have been made on how to improve on the agricultural sector. Last year, the call for land reforms took the center stage. Prior to that, the summit had called for expansion of cultivation of food and cash crops through the development of irrigation infrastructure. In this regard, the NESG acknowledges that in the first 10 years of the summit, government pursued an irrigation development scheme that led to the rehabilitation of old dams and the construction of new ones. The efforts, it says, resulted in the building of 142 medium/small dams and reservoirs. In addition, 60 large dams were constructed, bringing well over 336,870 hectares of land under irrigated agriculture. Government is also said to have invested over N80 billion in water and irrigation development.
Funding remains a major barrier to the development of the agricultural sector. The economic summit had therefore, recommended that government should provide soft loans for peasant farmers at single digit interest rates, with a moratorium and insurance cov cover. In response, the federal government in 1999 established the Nigerian Agricultural Cooperative and Rural Development Bank, NACRDB. This was aimed at rendering services to farmers. In 2001 government funded measures aimed at stabilizing seed production to the tune of N11.516 million. That followed the recommendation of the revival of the national seed service by the economic summit. Even with all that, quite an enormous amount of work still needs to be done in the sector as it still remains largely untapped.
In the oil and gas sector, the summits have been consistent in advocating deregulation, liberalisation and privatisation. For instance, in 1993 the summit recommended the initial reduction of government investment in its joint ventures with oil-producing companies to 50 per cent. It also called for the execution of the Liquefied Natural Gas, LNG, project with the desired commitment. Furthermore, commercialisation of the upstream sector of the industry as well as funding, transparency and enforcement of Joint Venture Agreements were recommended. The summit also called on government to set aggressive, yet realistic reserve and production targets in order to achieve the aims of Marginal Fields Decree.
Aside from that, previous summits also called for implementation of the 13 per cent derivation for oil-producing communities; the establishment of the Niger Delta Development Commission, NDDC; as well as making oil-producing areas stakeholders in the oil industry. These recommendations have been adopted to varying degrees. For instance, government set oil reserve target of 30 billion barrel by 2003. Current production level hover around 2.3 million barrels per day bpd, the target set by government based on the 3.0 million bpd recommended by the economic summit.
Similarly, several acreages have also been awarded to indigenes under the marginal field programme. Privatisation of major oil-marketing companies has been implemented as the pricing of aviation fuel otherwise known as Jet-A1 (ATK) and diesel fuel (AGO) have been deregulated. Government is in the process of taking the final step towards full deregulation of all petroleum products while provisional licenses for the building of refineries and fresh guidelines for operating in the oil industry have been issued. Although work on the Petroleum Industry Bill has reached an advanced stage at the National Assembly, the situation in the oil sector still leaves much to be desired. Many people believe that the step so far taken to resolve the conflagration in the Niger Delta region is only skin deep.
In the financial services sector, the Nigerian Economic Summit in its maiden edition advocated total commitment to privatisation of government-owned banks and amendment of Banks and Other Financial Institutions Decree to give the Central Bank of Nigeria, CBN, more powers to deal with problems that lead to distress in banks. The 1993 summit also called for the take off of Credit Bureaus and the establishment of special courts to address legal problems relating to the recovery of bad debts. As a follow up, the summit in 1997 advised that all the proposals submitted by the CBN and the Nigeria Deposit Insurance Corporation, NDIC, on distress resolution in banks should be implemented without further delay. The implementation took place the year after.
The ad adoption of universal banking system, which allows banks to collect retail deposits and be part of the clearing system in January 2001 and the opening of doors to foreign banks to establish fully owned subsidiaries in the country, was also a fulfillment of the aspirations of the economic summit. This was followed by removal of ceiling on interest rate, to combat low level of deposit mobilisation and the lifting of embargo on the licensing of new banks as recommended by the summit in 1995.
In 1996 the summit recommended that the Nigerian Stock Exchange, NSE, should adopt a price-driven bid and allocation system in order to boost trading and promote liquidity. This was aimed at bringing down the cost of raising funds from the stock market. The recommendation was implemented. Among several other policies in the financial system, government also implemented the economic summit`s recommendations on lifting of the ban on the printing of N50 notes and the introduction of N100 note and even higher denominations while making lower denominations available at efficient costs. It went further to introduce the N200 and N500 denominations.
Successive economic summits have consistently drawn attention to decaying public institutions that require rebuilding or reformation especially in the areas of security of lives and property; rule of law; combating corruption; and competitive industrialisation. Among several others, past economic summits had recommended efficient funding of the Nigerian Police and enhanced status for security agents by way of training and provision of facilities as well as adequate funding and modernisation of the court system. In this direction, imp implementation has been anything but impressive. In the education sector, the stock taking exercise at this year`s summit is most likely to reveal that enrolment in schools has progressed remarkably but the quality of education still remain at an abysmal level.
But like Nweke did say, Nigeria does not seem to be in short supply of ideas on what to do. What may be a fundamental task for the organisers of the summit this year, is to agree on an acceptable pace of implementation of the recommendations.
Box
Themes of Previous Economic Summits
1996 NES#3: Unlocking Nigeria`s Economic Potentials
1997 NES#4: Implementation of Vision 2010: The 1998 Budget Issues
1998 NES#5: The Challenge of Implementing Vision 2010-Anchoring Sustainable Growth
1999 NES#6: Rebuilding the Nigerian Economy and Enhancing Productivity
2000 NES#7: Breakthrough Economic Growth: An Action Plan
2001 NES#8: Nigeria`s Economic Priorities: How Do We Deliver?
2002 NES#9: Nigeria: Putting the Economy First
2003 NES#10: Nigeria: Partnering for Growth and Transformation
2005 NES#11: Building Momentum for Economic Transformation and Growth
2006 NES#12: Sustaining Reforms and Unlocking Nigeria`s Potentials
2007 NES#13: Nigeria: Positioning for the Top 20 League
2008 NES#14: The Race to 2020: The Realities, The Possibilities
Ohuabunwa: Government has been fair in implementing previous summit recommendations
Yar`Adua: Has not given Nigerians much to cheer about
Nweke: We need to do things right
Usman: Sets agenda for the summit
The power sector: Far from meeting yearning of Nigerians
Agriculture sector: Full of opportunities but largely untapped
Roads: Much still needs to be done Page 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 |
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