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Nigeria's Pedestrian Growth and Development Performance: How to Exit it

by Olabisi Showole - 16 August 2021 90 Views

The central thesis of this essay is that the combination of political leadership and political process is the essential or indispensable tool required to energize economic growth and sustainable development. This implies that a perspective political leadership with a long view of the economy and aided by effective political process has the onerous responsibility to formulate, administer and evolve policy- macroeconomic policy, specifically monetary, fiscal and exchange rate policies that will respond adequately and sufficiently to the need of growing and moving the economy to the enviable height. In that regard, an astute political leader is tasked with the ability to recognize the dynamism of political process to respond to the challenges of economic growth. In the alternative sense, the political leader should be able to channel macroeconomic policy towards harnessing the quantitative inputs of the production function in order to increase the obtainable output. In an equational representation of production function, Y= f (i1, i2, i3, i4, i5... ) where f means a function of or depends on; Y is the GDP, defined as the total wealth of a nation, or the total monetary values of goods and services produced in a country in a given year, which depends on the optimal exploitation of (i1, i2, i3, i4, i5....) inputs where i1= labor; i2 = land which Higgins, B describes as known and economically useful resources or total supply of natural resources; i3 = stock of capital; i4 = level of technology, and i5 = entrepreneurship. All of these inputs must, through application of macroeconomic policy measures and technology, be harnessed optimally for increased output/GDP.

Furthermore, political leadership has the responsibility to ensure that increased output is sustained by focusing policy attention, discriminately of course, on the components of the Gross Domestic Products (GDP) with a view to adapting them to respond, concretely and favourably, to economic situations desirous of positive changes, or to sustainable development. Again, this will become clearer from the equation of GDP as Y= C+I+G+X-M. In the equation, Y is the GDP.  In order to grow this national real output on a sustainable basis, or to address effectively, the challenges of the growth of the national economy, political leadership has to ensure, through fiscal, monetary or exchange rate policy that private consumption expenditures (C) decline, which consequently boosts or impacts savings positively; that private investment (I) expenditures, as well as government investment expenditures (G) are increasing overtime; (both I and G require a steady flow of a stream of savings that is afforded by less private consumption), and that net exports (X-M) are on the increase, reflecting increased private and government investment expenditures on products, infrastructures and technology. Increasing exports make export trade inevitable; international trade facilitates inflows of foreign exchange, which impacts positively industrial activities, and boosts current account of the balance of payments account. No wonder international trade is described as the "engine of growth".

The foregoing indicates the imperative of Political leadership's recognition and acknowledgement of the dynamism of political process to respond to the challenges of economic growth; it therefore behoves it to take due advantage of it to adeptly formulate, administer and evolve policies that will optimally convert factor inputs, in a production function, into increased obtainable outputs. Production function is a production system that efficiently combines productive inputs to produce optimally, total national real output/GDP, a proxy for a nation's economic growth, or national wealth. As it will become apparent later, it is not the end of discussions on growing the real output of an economy.

Beside the indispensable roles of political leadership and political process, we have yet another important factor - political structure, which can be equated to political framework that includes constitution, and political institutions- organizations in a government that create, enforce, and apply laws (Boddy-Evans, A). We can cite as examples, the three arms of a democratic government- Executive, Legislature and Judiciary, including their respective agencies; constitution and the fourth estate of the realm- the press. I recall writing about political structure or system as being fundamental because of the seamless relationships of its parts with the whole to achieve the goals of political stability, national security and socio-economic progress- important factors of national greatness. Thus, a break in the chain of relationships of the parts, for examples the constitution and institutions, which are vital to political and economic governance, portends dangers to the whole entity and should be avoided at all cost. This is because of the impacts of constitution as well as institutions on national stability and development.

There is yet another observation, that is, developments in the political sphere resonate in the economic sector. In other words, when there is, figuratively speaking, disharmony or discordance in the political and economic tunes, there is the possibility of negative developments that will impede the economy's positive transition to the desired state of sustainable growth and development. In a way, this speaks eloquently to the inseparability of the crucial roles of the political and the economic in initiating, and ultimately shaping and sustaining developments (positive or negative) in the economy.

The next important assertion I want to make is that it is not enough to achieve real economic growth. Such growth must be seen to translate into development- the process of improving the quality of human lives by raising people's living levels; by creating conditions conducive to the growth of people's self-esteem, and by increasing people's freedom to choose from available range of a variety of consumer goods and services (Todaro, M). Implicit in the definition are the need for access to quality education and improved health facility, the need to eradicate poverty and hunger through access to gainful employment, improved incomes, and available and affordable variety of foods as integral to development.

It is obvious from the preceding paragraphs that there is no dearth of growth theory, economic policy and strategy; they are available and accessible at the touch of a button to those in need of them. No need to reinvent the wheel! What every developing economy needs is a political leader that is attuned to the economic growth needs of his/her country and how to take advantage of existing information to set the country on the path of economic growth and development. Such a leader only needs to adopt and adapt or modify such information to suit the peculiarities of his/her country. It is thus pertinent to insist that political leadership is central to this onerous task. However, the political structure, including the constitution and institutions must not constitute hindrances to the attainment of the primary objectives of economic growth and sustainable development. Also, astute political leaders, particularly in the Africa's sub-Saharan region, should possess a long perspective on what nation-building entails, and should be unencumbered by extraneous factors of ethnicity, religion and the pursuit of hegemony. 

The pertinent questions to ask, with regard to Nigeria are: why, in spite of the plethora of growth & development theory, strategy as well as policy instrument, is Nigeria stuck at the level of pedestrianism? Does Nigeria have a political leader that possesses the aforementioned attributes? And is Nigeria's present structure suitable for attainment of economic growth and sustainable development? The answers to the questions are linked. For instance, Nigeria is stuck at the level of pedestrianism because Nigerian political structure is growth & development-inhibiting, and because Nigeria does not have a political leader that has the ability, intrinsic or otherwise, to build the country on a solid foundation of economic prosperity.

To get Nigeria out of the pedestrian, the commonplace growth and development status, we must get the right political leadership and political structure. There is no doubt that Nigeria has been unlucky in the choice of its leader, and that Nigeria's extant political structure has not been and will never be responsive to the goals of political stability, national economic growth and development until it is restructured. The bitter truth is that the present political and economic structures are not suited to developing Nigeria and its economy because of Nigeria's shaky foundation and its structural rigidities. At least, we can finger concentration of political power at the centre, weak institutions, infrastructural deficits and deficiencies, oil dependency/monoculture, exchange rate dilemma, high level of debts, high level of corruption, et cetera, et cetera. Under such circumstances, no matter the growth theory & strategy, no matter the economic policies and programmes emplaced or the economic stimuli introduced, it will be an uphill task for Nigeria to exit its pedestrian growth and development trajectory. To validate this conclusion, I just read from the Nigeria's Punch Newspaper of July 27, 2021 the disclosure by the World Bank's Nigeria Country Director that "Nigeria unfortunately has the distinction of having about the lowest revenue-to-GDP ratio in the world". That speaks eloquently to the negative impact of Nigeria's structural rigidities as well as policy measures working at cross purposes. So, take care of these rigidities and policy measures disharmony. Nigeria is on the road to actualising its potential for optimal growth and sustainable development.

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