Nigeria Post-COVID Economy: Seek ye first human capital development by Godspower Iheanacho
Editor's note: Writer Godspower Iheanacho, in this piece, writes on how Nigeria can survive the post-COVID-19 era economically, especially as many countries go into recession due to the economic effects of the global pandemic.
Read below:
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“The history of the 20th century is full of examples of countries that set out to redistribute wealth and end up redistributing poverty” -- as stated by Thomas Sowell in his article fallacy of redistribution.
The painful truth is we don't have to veer from Nigeria when looking for a nation that embodies the aforementioned statement --for a nation blessed with natural and human resources in its abundance, one would expect us to be on the path of economic prosperity but what we are currently experiencing is a country entangled in a hopeless situation of being inundated by the chokehold of poverty due to our failure to heed to frenzied warnings about the dangers of putting all our eggs in one basket. That is to say, while other oil-exporting nations have spent the past decades diversifying the productive base of their economy and preparing for this eventuality, we spent ours salivating over the crude-oil proceeds.
Alas!, the day of reckoning is here, the sheer fragility of our economy is becoming apparent, as the crude oil which is literally the oil that keeps the engine of our economy going is trading below the break-even point, the Excess Crude Account(ECA) has fallen by a whopping 98% in five years, coupled with the fact that unemployment rate jumped to 27.1% recently. All these are indicators that the economy of the largest black nation on earth is hurtling towards an abyss.
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In hindsight, Nigeria's greatest mistake was not the discovery of oil but rather the failure of policymakers to disenthrall themselves from the “Dutch disease syndrome.” Simply put, the past administrations erroneously treated the favourable but transitory oil boom in the 80s as a permanent phenomenon, thereby neglecting other key sectors of the economy.
However, as we try to unravel the harsh realities around us, one of the most important questions begging for an answer is, as oil becomes less profitable, what keeps Nigeria relevant on the global market? The people.
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Current status quo
We have watched with keen interest how the scourge of COVID-19 has not only shaken the foundation of the economy but also brought to the fore the sorry state of our health and education sector.
The education sector as we all know is bedevilled with incessant strike actions, dilapidated infrastructures, and poor funding. Worst of all, is the inequality which this “Black swan” event has unmasked -- while children of the elites attend schools which offers virtual learning, kids from the other side of the divide are made to bide their time at home owing to the failure of government-owned schools to equip themselves enough to transit to the new method of learning which the pandemic has evoked.
More worrisome, is the underfunded and understaffed healthcare sector, which the political elites have neglected over the years in favour of the ones outside the shores of the country. Reports from Businessday disclosed that the doctor to patients ratio is 1:2753, which is a far cry of 1:600 as recommended by WHO, this is indeed a troubling sight having in mind that Nigeria's population is over 190million. Despite the fact there is shortage in the numbers of medical personnel, the few available are not given the right environment and incentives to thrive. Unlike the education sector, the novel Coronavirus has proved to be a leveller, in this case, the rich political elites are stuck in Nigeria to inhale the fumes of their malfeasance. They have to make do with health infrastructures they collectively failed to develop.
In addition to the fact that Nigeria is currently the poverty capital of the world with over 40 per cent of its population living below its poverty line, all these are pointers that our beloved country is on a crossroad. With recession looming, this might just be the right time for us to play our trump card.
The way forward
It is obvious that the current economic makeup of Nigeria does not favour its citizens. Therefore, there is an urgent need for the government to reduce the infrastructural deficit which remains a major hindrance to economic growth. The importance of economic growth which leads to poverty reduction was underscored by the tremendous progress made by China and its neighbouring nations. They were able to attain such height, not because of the natural resources they possess but based on their ability to add value to that which they have. If we want to experience an upturn in economic fortunes, I am of the opinion that the current administration should take a leaf out of China's book.
First, we have to realize that the future of our economy lies on the optimism of its young populace whose average age is estimated to be 18 years. They should further create an economy where human skill will be the most important commodity. In doing so, the government needs to channel all their focus in funding the education and healthcare sector and making sure that quality education and healthcare is accessible to all, this will go a long way to harness the full potential of its populace. Though investing in human capital might not bring instant profit like crude-oil but its ripple effect, in the long run, will be worth it.
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