Moghalu Calls for Knowledge-based Economy

Funmi Ogundare

Former Deputy Governor, Central Bank of Nigeria (CBN), Dr. Kingsley Moghalu, yesterday called for the creation of an economic productive knowledge in Nigeria that will focus heavily on industrial and trade policy.

He noted that if driven by competent leadership, it would take the country out of the economic challenges it is currently facing.

Moghalu, who was a guest on The Morning Show on ARISE NEWS Channel, the broadcast arm of THISDAY Newspapers, expressed concern that goods imported from China are cheaper than those manufactured in Nigeria, stating that this is a practical problem for industrial production in the country.

According to him, “Many people go through schools and universities and learn the opportunity for production. We need to focus heavily on industrial policy in Nigeria. That means we might have to also deal with trade policy. Why should goods from China be cheaper than goods that are manufactured in Nigeria? That is a practical problem for industrial production in Nigeria. These are the things we have to look at-the trade policy to incentivise the export of finished products.

“That is very important. We need to look at the educational system and industrial and trade policy. These three areas would take us out of the woods. Unfortunately, it takes a bit of time. It doesn’t happen overnight, and it requires very competent leadership to drive it.”

Asked how we can get Nigeria to produce again, the political economist said focus must be made on understanding what economic diversification really means, fiscal diversification, as well as focus on the education system in the country.

Moghalu noted further that: “There are three types of economic diversification. There is the GDP diversification, oil sector contributing a lot to GDP, but has come down to about 10 per cent now, and agriculture has gone up to more than 30 per cent. That is important for an economy. On the export diversification, we have not done very well, and the oil sector continues to be a contributor of revenue for the country, whereas the export diversification should focus on value added manufactured goods, competitively produced, traded in the international economy and bringing us forex back into the country. You also have fiscal diversification, which the second aspect. The way to get there is to focus on the education system in Nigeria.”

He said there’s a very big problem in winning Nigeria off the cheap imports and transiting to a knowledge-based economy, adding that technical skills, not university degrees, are what drive modern economies.

The former CBN chief recalled that: “When I was working for the United Nations, I had a plumber who came to fix a broken toilet and had come with a BMW car. I opened the door when he knocked and I saw a BMW packed outside. He introduced himself and when he finished the job and gave me the bill, I understood why he could afford a BMW. So technical skills are what drive modern economies.”