Nigeria needs to diversify its economy for sustainable economic growth, writes Nume Ekeghe
The need for the federal government to work harder and further diversify Nigerian economy, especially the country’s revenue base was recently brought to the fore at a forum organised by the Nsukka Professionals Association (NPA).
Experts who spoke at the event with the theme: “Positioning for a Post Oil National Economy,” that took place in Lagos, highlighted the dangers in the country’s over-reliance on crude oil for its revenue.
Speaking at the event, the Managing Director Zinnox Technologies, Mr. Leo Stan Ekeh who was represented by MR. George Agwu, in his keynote said: “Many factors can be accrued to changes in oil prices, but one that is currently changing things in a way that we can’t control anymore is technology and innovation. We all know about Teslar, for example, that produce electric cars.
“In 2006, the world richest company was Exxon Mobil, followed by Gen Electrics, third was Gastron, fourth was Microsoft, fifth was Citi Group, sixth was Bank of America, seventh was Royal Shell, eight was BB, night was Petrol China and tenth was HSBC.
“However, in 2016, the world richest company was Apple and they have maintained that position till date; followed by Google, third was Microsoft, fourth was Bestir Atter wave, fifth was Exxon Mobile, sixth was Amazon, seventh Facebook, eighth Johnson and Johnson, ninth is Gen Electrics, and tenth China Mobile. You can see the shift.
“This shift is inevitable and it will continue. We all can see what Ali Baba is doing. And today, Apple is number one, and we can literally say that Amazon and Google are competing.”
He added: “What I am doing is to prepare our mind to what oil has been, what it is becoming and what will become of it in the future. Some technologies are emerging very fast. “There is a confluence of technologies, and those are big computer works and artificial intelligence, and this is where we are today; including robotics.
“There are so many ways we can live our lives. We can sit back and just be complaining, or we can decide to take our destinies in our own hands. What this means is that, when you see certain things going in some certain directions that we don’t feel comfortable about, don’t complain.
“The need to diversify and move beyond oil is not new. It has become part of the growth policy of many oil dependent economies for decades. Only few countries have made much progress.”
Also speaking, the Provost, Nigerian Air Force Institute of Technology, Prof. Emmanuel Ezeugwu, described ICT as a key driver to diversification post oil and stressed the need to harness opportunities in the sector.
According to him, the ICT sector is playing a key and prominent role in the growth, sustainability and overall prosperity of the United Kingdom.
He also emphasised the need to invest in human capital.
Ezeugwu added: “If we do not start thinking ICT now, before it comes to a time nobody will be buying our oil, including ourselves, there will be a major problem. Hence, environmental exposure, overseas training is very important. We can then therefore invest in human capital, train them in trending ICT skill, and they can therefore come back to the country to train other people and develop our economy outside oil.”
Agriculture as Alternative
In recent times, the government has been clamouring for economic diversification by promoting the agriculture sector. Although some success has been recorded in this regard, experts believe exporting agricultural produce should also be a focus for the government.
This was the thought of the co-founder, Sahel Consulting and Co-founder AACE Foods, Mrs Ndidi Nwuneli.
Commenting on the potential in cashew nuts, Nwuneli said: “Fifty-seven per cent of our household income in Nigeria is spent on food; the highest in the world. And in the south-east it is terrible, because we are known importers of food.
“And research shows that we in that region spend 60 per cent of our household income on food. When you spend that quantity on food it means that you have very little to spend on other things unless you eat very bad food.
“So very practical takeaway for you, is to map-out all the agricultural zones in your region, compile the list of small holders of small farms; what can we do to plant new cashew trees? What can we do to increase exports, trust me, cashew is a low hanging fruit because it generates jobs.”
She added: “A friend of mine set up a cashew factory in the east, overnight, the factory already had over 300 employers – women. There only job is to shell cashew.
“So instead of exporting the whole cashew nuts to India or Vietnam, and from there it goes to United States and Europe, why can’t we shell it in Nsukka? I don’t know why we don’t do that.
“And it is not just cashew; we also have others like Nsukka yellow pepper. What have we done with it other than to claim its ownership? Did we process it, bottle it or export it? Go to Rwanda, you will see a little pepper bottle that they are selling all over Africa, and it is really the same Nsukka pepper.So there are really many things we can do to add value aside oil.”
Speaking on the essence of the summit, the president, NPA, Mr. Charles Nwodo (Jnr) said it was intended to draw attention to the inevitability of disruption of the global oil and gas or hydro carbon market. “We know that apart from prices of crude oil that have fallen across the international market, thereby reducing federally collected revenue, there is also the disruption that is brought about by technology in the sense of advances in electric cars.
“Electric cars are no longer a design concept, they are now commercially available. What does it mean for a country like India to say that by 2030, every car that is manufactured in India must be an electric car?
“It means that for India that have a population of over a billion people, every car that is manufactured or imported into India, will no longer consume our oil. And then, there are also the electric airplanes; it has likewise moved from the design concept stage to the commercially viable stage.
“So, in a few years’ time, the airplanes as we know them will have electric airplanes. What these all means is that the consumption of our oil, which we all know to be our national asset; since there will no longer be market for them in future, will become useless.
“Hence, oil will no longer be a viable asset like we know it today; the idea is to draw the attention of our politicians, our policy makers, and our leaders at the various levels of government to this inevitability in the evolution of the global economic system. We need to plan for it.
“Now that we can easily predict that the global market for hydro-carbon resources is going to face a tailspin, it is important that our people begin to plan, diversify our economy, and create alternatives revenue sources to oil as peculiar to the strength of each state.”
On what NPA would advise the government to focus on, he said: “The essential thing is the realisation. To have the realisation that this is something that is coming.
“The second is to then sit down with the critical stakeholders within the various units – senatorial zones, local governments, and then, involve all the stakeholders; in government, business men, investors, farmers, rural dwellers, community leaders etc, and together, be able to identify resources or assets that are unique to each of these areas and can be harnessed and used as economically viable assets that can help the community, help the state, or government generate revenues aside oil.
“Also, we have to know how to harness the knowledge and youthful energies of the timing population of young active students in our universities, and see how to use this to generate revenue for the community and market the skills that these young people possess to a global market place, in other to empower them economically.
“We don’t have to have crude oil or gas to be competitive. We have examples in countries like Japan, Singapore, etc; that have no crude oil but are doing well economically. All they sell is knowledge, skills, talents, or artificial intelligence. These are things that are commanding values in the international market and will command values till the next decades.”