Since the launch of their policy documents, Nigerians have been wondering what Alhaji Atiku Abubakar, presidential candidate of the Peoples Democratic Party, could do differently to outdo the Economic Recovery and Growth Plan of the President Muhammadu Buhari administration, writes Bamidele Famoofo
This is a season of making promises in Nigeria. Usually, promises are made to capture power at all levels of governance by politicians to fulfill their aspirations at the expense of mostly undiscerning and uninformed electorates in the country. Just like other presidential candidates, Atiku promised to run an issue-based campaign and has unveiled a five-point economic agenda which he believes will get Nigeria working again.
Atiku said he would run a competitive and open economic system; reform public institutions; reduce Infrastructure deficit; promote economic diversification and invest in human capital development to grow the economy.
The critical policy priority according the policy document is to build a broad-based, dynamic and competitive economy with a GDP of US$900 billion by 2025.
“By 2025, Nigeria shall make giant strides in diversifying its sources of power and delivering up to 20,000MW”, the policy document also noted.
For context, Nigeria has only been able to generate 7,000MW of electricity, while transmitting a little over 5,000MW, at the best of times.
Besides planning to double the current GDP figure and increasing power generation to an unprecedented 20,000MW in the next seven years from its current level of 7,000MW a level achieved for the first time by the current administration, Atiku also promised to create 12 million jobs as Nigeria’s president.
The statement from the Atiku campaign organisation highlighted that “our policy document focuses on creating jobs, ensuring security, growing business, developing power and water infrastructure, agriculture and education and how we will empower women.
“Our policies outline the goals and methods for developing and revitalising Nigeria as the foundation of our campaign.
This policy document is being launched to encourage a dialogue with the people of Nigeria, inviting everyone to join us in helping to get Nigeria working again.”
Atiku also promised to create an enabling environment where the private sector will get access to credit.
The policy document states that “enhanced private sector access to credit will be prioritised and regulatory institutions will be strengthened and their independence will be shielded from political interference.”
A review of Nigeria’s economy by analysts at FocusEconomics suggests that the economy of Nigeria under the administration of Buhari appeared to have shifted into a higher gear in the third quarter following a slowdown in the second quarter. Incoming data, however, signals that growth cooled again at the beginning of the fourth quarter. According to the Ministry of Petroleum, oil output fell in October due to an escalation of sabotage attacks on oil production facilities. In addition, the Purchasing Managers’ Index (PMI) dipped to a 16-month low in October as both growth in output and new orders lost momentum in the surveyed month. Buhari has been criticised for his economic policies—particularly over the mismanagement of the FX market and the rise in unemployment Nigeria Economic Growth.
Meanwhile, growth is seen strengthening next year against the backdrop of rising oil production following a significant ramp-up in infrastructure investment in recent years. “Moreover, softer inflation and improved exchange rate liquidity should buoy domestic demand dynamics in 2019. Political uncertainty and downside risks related to the 2019 election cloud the outlook, however.” FocusEconomics panelists see GDP increasing 2.6 per cent in 2019, down 0.1 percentage points from last month’s estimate, and 3.0 per cent in 2020.
A review of the performance of the Buhari administration economic blueprint named Economic Recovery and Growth Plan (ERGP) by Deloitte one year after its launch showed that there was evident work in progress to ensure that the ERGP succeeds. Positive results are already manifesting in key economic indices such as real GDP growth year on year, growth in foreign reserves, downward trend in inflation, increased capital importation and narrowing foreign exchange gap. However, at year ended 2017, GDP was at 1.92 per cent growth rate, Nigeria ranked 145 in World Bank’s ease of doing business and power generation is hovering somewhere between 4,000 and 5,000 MW as against targeted metrics of 7 per cent GDP growth rate, ranking at 100 for ease of doing business and a 10,000 MW electricity generation by 2020.
The ERGP implementation team still has challenges to deal with. These include funding, budget implementation, security challenges (specifically in the North-east and North-central), fluctuation in global oil prices and increasing use of alternative sources of energy (e.g., shale oil).
The key drivers of any economic plan especially the ERGP are oil prices & production volumes, political stability and macro-economic policies.
The implementation team must continually guard these key drivers within the next two years as these will impact the achievement of the plan’s objective. In addition, other state governments should take a cue from states like Lagos, Kano and Ogun states by coming with similar all-round developmental plans to underpin the ERGP. Government at the state and local government levels through the National Economic Committee should be involved to drive an all-inclusive implementation of the plan.
“While some of the target metrics appear overly ambitious, overall the ERGP appears to be on course and remains quite robust and achievable. This is however subject to constant evaluation and assessment at fora, where questions such as how a 7 per cent growth can be achieved when capital expenditure is projected at 30 per cent per the plan. As these questions are asked, attention also needs to be paid to ensuring that this recovery plan translates into not just growth but development so that these gains are felt by the citizenry. That notwithstanding, we will continue to track developments and achievements in the coming quarters with respect to the ERGP”, Deloitte said in its report.
Action Aid Nigeria, in swift reaction to the declarations by Atiku and Buhari on how to move the nation forward based on their policy documents, said both candidates were not clear on how to achieve their plans.
The international non-governmental organisation said the candidates should move steps forward from ‘what-to-how’, adding that having the policy documents were not sufficient.
ActionAid in a statement by its Communication Officer, Lola Ayanda, said the organisation in the coming weeks, and during the presidential debate, expected the candidates to state in details to the electorates, how they want to deliver on these campaign promises with clear-cut benchmarks that are time-bound.
Buhari recently presented a policy document titled, ‘Next Level’, while Atiku on the other hand presented ‘Let’s Get Nigeria Working Again’, ahead of the 2019 elections.
Ayanda, who noted that the development agenda of the PDP is hinged on privatisation, said exercise had not worked in the past, particularly in the power sector; and so it is pertinent to tread carefully.
Action Aid stated that privatisation, rather than solve problems of corruption which has continued to undermine development in the country, has only deepened poverty and continued to widen the gap between the rich and the poor.
It expressed concern that privatisation would further increase the margin between the rich and the poor because with privatisation, public services would turn into a merchandise available only to the highest bidders.
On the other hand, it said the APC Healthcare Plan was focused on human resources, saying while it commended the plan to pay young doctors to work in rural communities, the effort might not yield much result without commensurate infrastructures, drugs, and other essential healthcare consumables.
It would be recalled that Bill Gates, a leading American businessman once faulted the current administration’s economic templates, saying it lacked the ability to address the unique needs of Nigerians at present.
The investor noted that though Nigeria was rapidly approaching upper- middle income status, the country had ”unmatched economic potential and what becomes of that potential depends on the choice Nigerian leaders makes.”
He said while the federal government’s ERGP identified “investing in our people” as one of three “strategic objectives”, the “execution priorities” did not fully reflect people’s needs, “prioritising physical capital over human capital.”
Gates said the most important choice Nigerian leaders could make was “to maximise the country’s greatest resource, which is the people”. According to him, Nigeria will thrive when every Nigerian is able to thrive.
“If you invest in their health, education, and opportunities- the human capital we are talking about today, then they will lay the foundation for sustained prosperity. If you don’t, however, then it is very important to recognise that there will be a sharp limit on how much the country can grow,” he said.
Meanwhile, Action Aid recommended that the agenda and programmes of the candidates for the various offices ought to be in tandem with the manifestos and official programme documents of the political parties of the respective candidates.
Without this synergy in the plans, it said, it was difficult to see or envisage how the programmes of candidates were going to be implemented in office if they are different from the programmes of the parties through which they got their mandates.
It stressed that focus should be placed on improving the ease of doing business in Nigeria, adding that a pay-as-you-earn model, where the wealthy pays more taxes, and an accountable revenue generation drive with clear plan on how to improve tax collection systems should be adopted.