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Nigerian Realities and Options to the Year 2010

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MOHAMMED SALISU

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Jul 31, 1997, 3:00:00 AM7/31/97

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NIGERIAN REALITIES AND OPTIONS TO THE YEAR 2010

By Yusufu Bala Usman, Department of History, A.B.U. Zaria

A Discussant of a paper titled "The Nigerian Place in the Global Economy by
the Year 2010" by Chief E.A.O. Shonekan, at the 37th Annual General Meeting
and Conference of the Nigerian Association of Chambers of Commerice,
Industries, Mines and Agriculture, Premier Hotel, Ibadan, Thursday 19th
June, 1997

THE paper just presented by Chief E.A.O. Shonekan, Chairman of the Vision
2010, titled "The Place of Nigeria in the global Economy by the Year 2010"
to this 37th Annual General Meeting/Conference of the Nigerian Association
of Chambers of Commerce, Industries, Mines and Agriculture (NACCIMA) deals
with the very important subject of the future of our country and its place
in the world, at the end of the first decade of the 21st century. It
addresses the crucial issues of visualising the future and planning for it,
which are essential requirements for meaningful human existence.

Even the most hardened, cash-and-carry, operators among you, know that to
make real money, this this country or anywhere else in the world, you have
to have had your eyes clearly and realistically focussed on the future.
For, every present was, first, a future. Every future, is only a future,
because it is becoming a present. Those who ignore this reality and live
entirely in the present, shall have no place in the future, and will soon
become relics of the past, frightened of the future, and confused in the
present.

This paper by Chief Shonekan, on where Nigeria shall be in the world, by
the year 2010, therefore, deserves serious attention. This is not only
because of the importance of the subject, but because it is from somebody
who has had a distinguished career as a top-fight corporate executive and
leading spokes person of the big business corporations operating in this
country and is now the Chairman of the Vision 2010 Committee, established
by the government to propose the direction this country should take in the
twelve years, 1998-2010. I hope, this conference of NACCIMA will give the
paper the serious treatment it deserves.

As one of its discussants, my contribution shall be to attempt to assess
it, beginning by bringing out clearly the key positions set out in it, with
regards to its subject matter. I shall then assess each of these positions,
and the whole paper, to see whether or not it gives us a rational and
realistic forecast and a vision, as to what place Nigeria shall occupy in
the global economy by the year 2010.

This paper has, in my view four key aspects. The first one is a statment of
methodology. The methodology is, according to Chief Shonekan, the one used
by the Vision 2010 Committee, in what he called "the visioning process". It
consists of posing and answering three questions of where are we now? Where
do we want to be by 2010? And how do we get there? <.P>

The second key aspect o fthe paper is a definition of the present state of
the Nigerian economy and the weak position which its poor performance has
placed it in the world today. This is combined with a diagnosis of what he
calls Nigeria's development failures, which have resulted in this weak
position.

The third key aspect of the paper is his identification of what he calls
"the strategic forces" shaping the global economy now and for the
foreseeable future; forces, towards which, according to him, no country has
any alternative but to adapt to, hence the acronym used to describe their
superhuman and supernatural powers is "TINA, There Is No Alternative".

The fourth key aspect of the paper is the absence in it of any forecast or
vision as to the place Nigeria shall have in the global economy by the year
2010. This is significant, because, this is precisely what, by the title of
the paper, he is expected to tell us. This is what Nigerians should learn
from the Chairman of the Vision 2010 Committee, which is to conclude its
ten month long assignment in the next three months.

Methodology

Let's start with what he says is the methodology they use in the "visioning
process" and which is the one in this paper. This methodology amounts to
posing and answering the three questions of where are we now? Where do we
want to be by the yer 2010? How do we get there? In it, one cannot see any
method which has any scientific, or even rational basis. The scientific
position with regards to all phenomena is that the place which any entity,
in the natural world, or in human society, shall occupy in the future is
determined by the internal processes of change of the elements constituting
it, interacting with the external forces shaping these elements.

That is why, to know where any entity is going to be in the future, it is
necessary to project where current objective trends are taking it to. After
establishing what these trends are and what their possible outcomes are
likely to be, one can then have a rational basis for bringing in one's
dreams, hopes and aspirations and seek to see how one can shape the
objective realities of its current momentum and take it as close to one's
vision, as to what it should be in the future, as is humanly possible.

To have a meaningful vision of the future of a country, and its place in
the world, and to outline a plan as to how this vision can be realised, the
first thing to do after establishing its present conditions and
circumstances, is not indulge in wishful thinking as Chief Shonekan does
here, but to project on the basis of current trends, where it shall be by
the year 2010 or whatever year in the future. This projection involves
identifying the key variables determining its direction of change. For a
country, these include, at least, the notion of its geology, hydrology,
climate, demography, economy, technology, social structure, political
systems and culture and, of course, its sub-regional, regional and global
external environments. The various alterntive possibilities as how each key
variable will change will be identified and incorporated in the projections
and this will give alternative scenarios as to where the country is heading
to.

This is so that one can say, for example, given the likelihood of global
warming and a wetter climate in the next thirteen years, what will be the
effect on agriculture, fisheries, livestock, road construction and
maintenance, housing, water supply, migrations, oil drilling, health and
even clothing? Or say given wars, or the discovery of oil, in a
neighbouring country, what will be the effect on the economy and on the
political and security situation in Nigeria? On the basis of these
projections, incorporating many variables one can then come face to face
with what the future is likely to be and then dream, visualise and plan, as
to what it should be like with a rational basis for seeking to make it what
one wants it to be, at any specific point in the future.

To simply jump from where we are, to where we want to be, and then seek to
set out how to get there, amounts to building castles in the air, with no
foundations on the ground. This is not a visioning process, but a wishing
process.

Clearly, the methodology of the "visioning process" currently been
conducted by the Vision 2010 Committee to fashion out the future of this
country, as defined in this paper, is irrational and unscientific. It is
just wishful thinking, expressed in a pretentious form. Even a child does
not jump from what he has in his pocket for sweets today, to what he wants
to have next week, without considering what he gets normally form his
parents and others.

The projection of current trends and the taking into account of key
variables is such an elementary exercise, without which any visualisation
of a desriable future goal for a country is so obviously meaningless, that
it is baffling how Chief Shonekan, and the high-powered members of the
Vision Committee can fail to realise that. For, without answering the
question of where we are heading to as a country and, therefore, where we
are likely to find ourselves in the next thirteen years, given current
trends, the whole exercise amounts to attempting to take a country of over
one hundred million people on a wild goose chase for a mirage in the
desert.

Diagnosis

But to compound this unscientific methodology, Chief Shonekan's diagnosis
of the causes of the weak position of Nigeria in the global economy is very
shallow, and fails to provide the sort of realistic diagnosis required to
rectify the severe shortcomings of the Nigerian economy. He says in the
paper that:

"Generally Nigeria's economy is today among the fifty poorest performing
ones in the world and this has been clearly revealed by the key performance
indicators revealed to earlier. The question to be asked, why this dismal
picture in spite of the copious resource endowment of Nigeria? Several
explanations could be given to get to the root of Nigeria's development
failures. The likely ones include faulty domestic policies, including the
public sector investment programme, infrastructural bottlenecks, political
and policy inconsistency as well as instability and inadequate investment
in human resource development, among others. The implication is that we
must reduce these problems for Nigeria to be in the desired position within
the global economy in the year 2010".

The four causes he diagnosed for Nigeria's poor economic performance, are
all symptoms not causes of the problem. The diagnosis he gives is like that
of a quack doctor who regards typhoid simply as fever, and treats the
fever, leaving the typhoid, which the quack doctor's shallow diagnosis has
failed to to identify. The scientific approach is to inquire deeply into
every symptom and seek to see what causes it. The four causes he sets out
are:

(i) faulty domestic policies, including inefficient public sector
investment programme;

(ii) infrastructural bottlenecks;

(iii) political and policy inconsistency and instability;

(iv) inadequate investment in human resource development.

The questions to ask after setting these out are: why were the domestic
policies faulty and the public sector investments inefficient? What, and
who, caused the infrastructural bottlenecks? What caused the political and
policy inconsistency and instability? Why was the investment in human
resource development inadequate? The answers to these questions are what
will take us closer to the roots of Nigeria's development failures. But,
Chief Shonekan having placed all the blame where he wishes to place it,
does not want to go any further into the truth of the actual process that
is making the Nigerian economy incapable of performing well.

But nodboy can run away from the truth. Sooner or later it will catch up
with you, in one way or another. It is better to recognise and face up to
it now, rather than later, as history has, time and time again, vividly
demonstrated.

Roots of failure

The truth Chief Shonekan wants to run away from is that, at independence,
Nigeria had an economy organised primarily for the export of primary
commodities and the import of finished manufactured goods. This economy was
dominated by a corporate private sector, made up of a handful of European
trading companies, for whom the colonial government of Nigeria was
established to provide protection and support. Since the major goal of
these trading companies was to operate their export and import businesses
to make profit, to take out, and pay to their foreign shareholders, the
economy was basically geared to facilitate capital flight from Nigeria.
Many of you here served yourselves, you know this is precisely what they
did to our country.

The private sector then was made up of private, small-scale individual and
family enterprises and these trading companies, and it produced most of the
Gross Domestic Product, and was the source, through various forms of
taxation, of government revenue, and of the country's foreign exchange
earnings. The marketing board regulated the export of some of the crops,
and retained some of the surpluses for the government.

>From the late 1950s, the regional and federal governments embarked on
expanding transport, educational and health facilities, the utilities,
modern housing and the administrative infrastructure. This increased the
size of the public sector. But the economy remained oriented to the
export-import operations controlled by European trading companies and the
increasing number of Levantine and Nigerian importers and exports. Little
was invested in manufacturing.

The railways, ports, roads, waterways, electricity and communications, were
only developed to the extent that they served these export-import
operations, which were geared to ensure that capital generated in Nigeria
was taken out for investment elsewhere. This capital drain itself limited
the extent of the maintenance and development of this infrastructure. Hence
the grossly underdeveloped state of our railways and waterways, which are
the essential backbones of any efficient transport system, necessary for
modernising agriculture and for industrialisation.

The reconstruction and rehabilitation necessitated by the Civil War of
1967-70 and the increase in the rent and royalties earned by the government
from crude oil exports, produced the ambitious Second National Development
Plan of 1970-74, which massively expanded the role of the public sector.

This expansion continued under the Third National Development Plan of
1974-1980, but was not accompanied by any substantial improvement in the
structure, size, patriotism and the planning and executive capacity of the
public services. The attempt to cleanse and sanitise it by the mass purges
of 1975-1976, did not succeed, because the top military and civilian
leadership of the country, in both the public and private sectors, failed
to measure up to the standards of discipline, probity and patriotism,
aseeted during the short period of Murtala Muhammed's stewardship, July
1975 - February 1976.

The public service, therefore, came to render less and less service to the
public. Attempts continued to this day to misrepresent and lament that
effort to make the Nigerian public services serve Nigeria; an effort which,
whatever its shortcomings, was necessary given the extent to which public
and national interest had come to be, glaringly subordinated to private,
individual and foreign interests, during the period 1970-1975. The public
service became primarily a conduit for well-connected individuals and
companies in the private sectors to milk public resources. This came to be
done primarily through import-export transactions, involving the transfer
of Nigerian foreign exchange to other countries.

With the expansion of crude oil production from the early 1970s, the
government not only came to control massive amounts of money from the rent,
royalties and taxes obtained from crude oil exports. But it came to command
over ninety percent of the foreign exchange earnings of the country, in the
form of petro-dollars. The domination, of the economy by exporters and
importers, primarily interested in taking capital out of Nigeria, became
even more entrenched, this time as part of a larger system of the recycling
of the large amounts of petro-dollars paid to oil exporters by the
oil-importing countries of the North.

In Nigeria, the system worked through contracts for construction and
supplies with a high import content and through other forms of import
transactions, which often involved no imports at all, merely the fraudulent
transfer of Nigerian petro-dollars into private accounts abroad. The system
worked so effectively against Nigeria that when in 1979-1983 oil prices
were getting to forty dollars per barrel, the outflow of petro-dollars from
Nigeria exceeded the massive inflow. This inflow reached a record level of
14 billion dolalrs in 1980 and 12 billion dollars in 1981. In these two
years, which marked the onset of the economic crisis of Nigeria, the
outflow rose from 12 billion dollars in 1980 to 15 billion dollars in 1981.
Not only was the rate of increase of the outflow of the Nigeria's foreign
exchange earnings higher than the rate of increase of the inflow, but the
burden of external debt was also rising and there was nothing to show for
it. This debt rose from about 2 billion dollars in 1979 to about 10 billion
dollars in 1983!

Contrary to what Chief Shonekan wants us to believe, the fact was that with
or without a fall in the earnings from oil exports, the Nigerian economy in
the early 1980s was heading for a major crisis, particularly because of the
way the high level of import dependence had undermined real investment in
agriculture and manufacturing. The investments that were announed were
largely paper transactions to take out foreign exchange. From 1982 to 1986,
various forms of austerity programmes were imposed, social sector
expenditure and limits to the budget deficit. These only made matters
worse.

In September 1986 the Structural Adjustment Programme promoted by reliance
onwhat are called "market forces" with a debt repayment programme and an
exchange rate for the naira which facilitated further outflow of foreign
exchange from Nigeria and which entrenched the flight of capital from the
country. The damage and devastation this has inflicted on the country are
here for all to see. Those who want to continue with it are trying to hide
it under a new name, the most favoured now being the "Medium Term Economic
Recovery Programme". But the Vision 2010 Committee may come out with a
repackaging of the same thing.

The truth is that Chief Shonekan cannot face up to the actual realities of
the process of the wrecking of the Nigerian economy, not only because of
the role of the big foreign corporations he has so faithfully served in,
but also because the empirical evidence regarding what happened knocks down
the dogmatic position which the World Bank and the IMF insist upon and
which he has swallowed, hook-line and sinker. This dogma is that the major
cause of the poor economic performance of Nigeria is the dominant role of
the public sector.

To be continued next week

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(last updated 27/7/97)

Nubi Achebo

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Aug 7, 1997, 3:00:00 AM8/7/97

As an erudite scholar Bala Usman exposes the pretentions of Vision 2010.
It has been clear from the start that this is another step in keeping
Nigerians busy about nothing. making people think we are moving forward and
looking for viable means for the development of the country. What Abacha
has charged Vision 2010 with other countries have achieved conscientiously
using the existing governmental structures. When will Nigeria be really
serious about planning for the future?

Nubi Achebo
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Nubi Achebo

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Aug 7, 1997, 3:00:00 AM8/7/97

Nubi Achebo
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At 03:13 PM 7/30/97 +0100, MOHAMMED SALISU wrote:

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