Experts at Afrinvest Research Limited have called on the federal government to maximise the huge economic potential of the maritime sector, to diversify the nationâ€™s economy.
They argued that the Nigerian seaports have been underutilised and operated in a grossly inefficient manner despite its significant contribution to governmentâ€™s revenue of N299.6 billion in 2017.
The experts, who stated this in their report on the review of the Nigerian economy and financial market for the first half of 2018, pointed out that ocean going vessels decreased to 4,175 in 2017, from the 4,622 it was in 2016.
This, the report stated indicated reduced preference for Nigerian seaports as a result of poor infrastructure, duplicity of charges, inefficient service deliveries, high waiting period and increased Terminal Handling Charges (THC).
According to Afrinvest Research, â€œIn addition, the Lagos port remains the most active due to its proximity to market and as a result, is often congested as the existing infrastructure for transportation of goods remains below par.
â€œWe believe that improved operations and investment in these ports will boost competitiveness and flow of trade which will have positive spill-over effects on growth.
â€œRelatedly, improving infrastructure in Nigeria would also boost the fiscal revenue base which further supports the goal of revenue diversification away from oil.
â€œOther sectors that will benefit from increased spending on infrastructure include agriculture, manufacturing and trade, all of which also have a catalysing impact on the economy at large.
â€œWe recommend the adoption of more Public Private Partnership structures by the government as a more efficient route to driving infrastructural development as well as strengthening fiscal diversification.
â€œFurthermore, infrastructural development through effective utilisation of earmarked funds will further drive real sector growth and improve trade competitiveness.â€
The experts also stated that the widening infrastructural deficit had continued to hamper competitiveness and growth in the Nigerian economy.
They added, â€œTo tackle this challenge, the National Integrated Infrastructure Master Plan (NIIMP) – which focuses on investing in transport, energy, ICT, social infrastructure, housing, security and agriculture – was drawn up in 2014. â€œHowever, implementation of this plan has remained sub-optimal given the amounts budgeted for such critical sectors since then.
â€œAccording to the NIIMP, an estimated total of $3.0 trillion will be needed to revamp and maintain Nigeriaâ€™s infrastructure.
â€œThe poor state of infrastructure in Nigeria is further buttressed by the understanding that the optimal proportion of infrastructure stock to GDP is at about 70 per cent; current level in Nigeria is between 20 â€“ 25 per cent. Furthermore, efforts and policies geared towards achieving this goal have been underwhelming as reflected in the deteriorating conditions of some of the key infrastructural dependent sectors of the economy.â€
On the path to achieving optimal and sustainable growth in Nigeria, they said the mission to achieve inclusive and sustainable growth has attracted global attention with a universal call to end poverty, protect the planet and ensure that all people enjoy peace and prosperity by 2030 as evinced in the 17 Sustainable Development Goals (SDGs).
â€œAccording to the United Nations Development Programme (UNDP), despite the decline in the number of people living in extreme poverty (less than $1.25 a day), from 1.9 billion in 1990 to 836 million in 2015, 80.0 per cent of these people are in the South Asia and Sub-Saharan African regions.
â€œFurthermore, a recent report by the Brookings Institution using the World Poverty Clock data (June 2018) shows that Nigeria has become the extreme â€œPoverty Capitalâ€ of the World, overtaking India even though Indiaâ€™s population is 7.0x larger than Nigeriaâ€™s (73.0m extremely poor people in India account for 5.6 per cent of its population).
â€œSpecifically, 86.7 million fall within the extreme poverty net. This is further aggravated by the estimated fast paced growth in its population by 2050 (estimated at 400 million people). This quagmire is traceable to the mismanagement and inefficient allocation of scarce resources by the government to key priority sectors that will propel a more inclusive and sustainable growth as well as eradicate poverty by a substantial amount in coming years.â€