The Five Pillars of the Next One Hundred Trillion Dollars

DIGITAL ASSET MARKETS with Nicky Okoye

Nicky Okoye discusses the strategic impact of digital asset markets in the growth and dynamics of the global markets and dives deep into the monumental forces that are driving the growth of the next hundred trillion dollars in global GDP. In this series of essays, policy makers, legislators, enterprise executives and investors can gain strategic positioning variables as they unfold in real time. 

If you have been following this series, in my third article I mentioned that the global economy as measured by nominal GDP is projected to grow to over two hundred trillion dollars over the next twenty five years. I have taken the time to outline the core pillars that will not only drive this growth but will also determine the winners and losers, especially as Nation States position for the future. In the following text, I will define why I think these five pillars are extremely important pillars for Nation Building. In addition, I make the case that these five pillars, if used carefully, can guide strategy design which will reposition our Nations, as well as stimulate policy that itself will be used to ensure value is extracted on behalf of all our people for the foreseeable future. 

The five Pillars of the Next One Hundred Trillion Dollars explained in brief: 

1.          Global Population Growth: This matrix will guide Leaders to study the growth patterns of the World’s geographical populations. Data will indicate where the new markets will be and where the new centres of global productivity will also be. Global population growth patterns will define and determine National purchasing power, consumer trends and economic market dynamics over the long term. Productive populations with high growth rates will be winners in the Next one Hundred Trillion Dollars.

2.          Digital Asset Markets Strategy: All leaders today and leaders in the future will need to understand the driving forces behind the digital asset markets in explicit detail. Many African leaders, have up till now, somehow gotten away with not developing effective capital markets for their economies. However they will not be able to ignore the digital asset markets, no matter how lame or disconnected we wish to be. Valuations of National assets, valuations of nation states and even enterprise balance sheets will all be affected by the way digital asset classes are treated and represented in the future. Currently only fifteen African Nations out of fifty four Nations, have effective capital markets operating within their economies. And even for these fifteen, their capital markets are mostly illiquid, weak and ineffective for wealth distribution and capital formation. 

3.          China Strategy: Making the Case for China has been an exciting experience for me. It is clear that most of the World sees the new role China is playing from different vantage points. In geopolitics, China has gained monumental influence among Nation states. However more importantly, China is hitting the ball out of the ball park in global output, exports, industrial value chains etc. China is currently blasting on all sixteen cylinders, and so for Nigeria and Africa, the best advice would be for us to study China, learn from them and position ourselves for the future. A China Strategy for Nigeria, or for Nigerian Industry and by extension for Africa as a whole, will be most fundamental to positioning in the industrialized global ecosystems of the 21st century. 

4.          Africa Content Strategy: African Leaders must understand and adopt what I call an “AFRICA CONTENT STRATEGY” for the future, if we will be able to position for the Next One Hundred Trillion Dollars in global GDP. Making the Case for Africa Content will involve leaders at all levels to better understand and embrace this concept. In my thesis, African Content refers to Africa’s human capacity, African technology, Africa’s rare earth minerals, Africa’s processing capacity for agricultural products, Africa’s livestock etc. African content can already be found in most value chains in several industries across the World. Our job as leaders is to make sure that every industrial value chain for the foreseeable future contents an aspect of Africa’s content within the value chain mix that will ultimately benefit the African people and create new jobs on a monumental scale. In addition, Africa’s digital asset classes and future digital asset markets will have to take a centre stage in filling the funding gap for Africa’s development, as Africa’s asset bases are already playing major roles in global development, without the resultant benefit to African Nations. This double standard that does not benefit the African people and the African continent will be eliminated once we adopt an African Content Strategy for all African and Caribbean Nation States.

5.          Technology and Innovation: Nothing has demonstrated over the years to be more important in National Development, economic development or raising the standards of living of the citizens of a nation state than access to cutting edge technologies.  To be honest as I have continued to maintain, access to 21st century technologies, will define the winners and losers in the 21st century, especially as it relates to the next one hundred trillion dollars in global GDP. I have studied many nation states and their rise to power and dominance, it has always been their access to technologies and in many cases that access being very exclusive, that made the difference. This is true for the way in which the British Empire became a Maritime powerhouse, overtaking the Dutch empire in ship building technology. It was technology that gave the United States the edge in the pacific conflicts during the second World war, eventually we saw the United States drop the first atomic bomb on two Japanese Cities of Hiroshima and Nagasaki. It is currently technology that has given China the edge in its rapid rise to World economic dominance, for which it is currently leading the World in several industrial segments and value chains. Positioning for access to 21st century technologies will take several directions, including but not limited to human capacity development, innovation in machine design, machine learning, exchange programs, and extensive incentives for a preference in STEM (Science Technology Engineering and Mathematics) education.

Global Population Growth

According to Statista, Nigeria will have almost 80% of the population of China by the year 2100. So whereas China’s population is expected to hover at just over one billion people (1 b) for 2100, Nigeria’s population is projected to  grow to well over seven hundred and ninety million (790 m) people, by the year 2100. The growth of a Nation’s population translates to two things, first it means that the Nation State has access to monumental numbers which can boost its productive base. Second thing is that once you have a population that is productive your nation transforms into a global marketplace. This means that local suppliers and local corporations can build wealth by simply supplying goods and services to the local population. The large population growth also gives leaders and nation builders the unique opportunity to reposition the Nation State as a global production base. In a recent projection by Goldman Sachs analysts, they declared that Nigeria’s economy will grow to the fifth economy in the entire World by 2075. The Goldman Sachs analysts projected Nigeria’s nominal GDP to hit $13.1 trillion by 2075, this obviously  means that GDP PPP will be much higher.

In studying the growth of our local population, we can define three areas that Nigerian Leaders must take into account. These include:

a.          The demographics of the population. For Africa and Nigeria, our demographics are very positive. Nigeria’s youth bulge is very healthy, effectively we are considered a young population. Over 60% of Nigerians are under the age of 35. A young population is a major advantage for several reasons. The younger working class can carry the burden of productivity for much longer. Whereas those Nations with an ageing populations, cannot expect to depend on those aging people to pay taxes or provide the productivity that is required to carry the economy, Nations in this situation include but are not limited to  Japan and most of the OECD Nations.

b.          The education and capacity of the population. The advantages of having a very positive demographic population can be undermined by having an uneducated population. The more the World digitises, the more educated the population must be. So African and Nigerian Leaders who seek to position their Nation States in respect to the projected one hundred trillion dollars growth in global GDP, they must invest heavily in education. This is not a simplistic approach to educating the population, it requires an overall human capacity development strategy which must be designed to expand the skills of the most productive population in terms of STEM and other areas that are in demand in the 21st century. 

c.          The Leadership of the people. The role of Leadership cannot be overemphasised. The leaders and nation builders must set the pace, set the direction and take the lead. The growth of the young population is happening, so how do we get the advantages of the young people? The answer is Leadership. “Thought leaders” are as important and even more effective in some cases as “political leaders”. In this respect Nation states must design and develop the environment for the expansion of “thought leadership” on a consistent basis.

There are key areas where I advocate that Nigeria can position today for our young population: 

i.           Artificial intelligence labs in every University and placed in several selected special secondary schools.

ii.          STEM exchange programs for all Nigerian universities with selected Chinese Universities.

iii.         Special endowments for the most talented researchers and teachers from all over the World to spend sabbatical leave tenors at selected Nigerian Universities.

iv.         Special programs for Africa’s Diaspora to participate in education, medical services and enterprise development across Nigeria and Africa.

v.          An Africa wide program for qualification, validation and integration of global skills.

•Nicky Okoye

Global Investment Advisor