If Nigeria could fix its collapsed rail and energy infrastructure, they could provide the next catalyst for rapid growth in the economy, similar to the huge impact that telecoms has made in the last 15 years, as captured by the recent GDP rebasing exercise.

“Rail transportation and Fuel/ Energy are the next growth giants. If we do not fix them, not much else will work, including manufacturing, industrial activity and agriculture,” said Ayo Teriba, CEO of Economic Associates, a risk analysis and research firm, in a presentation on ‘Economic outlook for 2015’, made in Lagos, yesterday.

“Much of our harvests still rot from a lack of transportation to markets, while most inland cities and trading activities declined as the rail lines stopped functioning.”

Enablers are sectors whose growth will influence others.

The National Bureau of Statistics (NBS), rebased GDP figures show a reclassification of sectors of economic activity from 33 to 46 sub-sectors, revealing many fast growing areas of the economy.

The new GDP data from the NBS showed that six major areas of economic output drove growth, including crop production, which contributed 21.5 percent, Trading (16.4 %), Oil and gas (15.6%), ICT (11%), Real Estate (7%) and Manufacturing (6.6%).

However, the major implication of the data is that growth has become concentrated by sectors, and regions.

Crops, trade, telecoms, oil and manufacturing are heavily concentrated in only two or three regions, while 73 percent of economic activity come from the six major sectors.

This could be corrected if rail and energy issues are tackled, Teriba said.

“Nigeria’s growth is structurally weak, with linkages weakened by poor energy supply and transport failures,” said Teriba.

“I do not know of any top – 10 country in the globe, in terms of population, without a functioning rail sector. Rail is about freight and most rail terminals fuel city growth. Once the rails collapsed, cities collapsed and industrial clusters failed.”

A turnaround of the railways should be private sector-led, as was done in telecoms, as opposed to Government which has inadequate funding attempting to revamp the sector, according to Teriba.

The Federal Government has recently resurrected the flagship Lagos-Kano rail service which took nearly three years instead of the planned 10 months, with China Civil Engineering Construction Corporation and Costain West Africa, a local company, splitting the $153m government contract.

The Lagos to Kano train moves at a speed of around 50km/h, meaning a trip usually takes 3 – 5 days to complete.

Completed under British rule 100 years ago, the Lagos-Kano route helped develop Nigeria’s agricultural and mineral economy.

The service declined soon after independence however, due to mismanagement and government neglect.

By the time it was shut in 2009, the number of annual passenger rail trips in Nigeria had fallen to 1.3m, down from 11.3m in 1963. The drop in goods moved fell from three million tonnes to 52,000 tonnes.

Regional inequality in Nigeria has become a huge structural problem for the entire economy that cannot remain ignored, as two regions in country continue to remain excluded from the growth process of the entire economy, according to Teriba.

These are the North-East and the South-East regions.

The six regions in Nigeria are the South-West, the South-South, the South-East, the North-East, the North-West and the North Central regions. Of these regions, the South-East and the North-East contribute the least to the GDP of the country.

The two regions have been marginalised as a result of the low investment drive to harness the natural endowments of these regions, and inaccessibility, Teriba said.

Despite the North-West and North Central being landlocked, there have been huge federal investments over the years in these regions, to drive agriculture, as a result of the large landmass, favourable conditions for agriculture and the necessity of preventing droughts in these regions.

This has resulted in excellent irrigation networks, infrastructural investments and investments in agriculture in these regions.

The South-West region of Nigeria is coastal, with its seaport being a huge driver of commerce since colonial times. The neighbouring countries are also coastal, aiding the growth of this region.

The South-South region is endowed with crude oil and is also coastal, thereby attracting federal investments into the region.As a result of national investments being driven by business interests, inequality has been deepened, with the rich regions getting richer and the poor regions getting poorer.

To address this, the Federal Government should take on an inclusive growth approach and tap into the natural endowments in the two marginalised regions; metals ores in the North-East and coal in the South-East, says Teriba.

In the same vein, a functioning, fast and efficient rail system between rich and poor regions would make these regions accessible and increase interconnectivity among all regions in Nigeria, thereby pushing commerce and creating economic growth spots in these pockets of exclusion.


SOURCE -- BUSINESSDAYONLINE

The part in bold.....is it giving you a bone/r?

Well Mr Ayo Teriba is entitled to his own opinion!

You know I got confused on some parts. Especially the part you said South east contributes less.

The markets in Onitsha and Aba manufactures quite a lot for export. Doesn't this add up to the GDP?

South-south only contributes what is Natural (Oil). Other regions, I can't talk much.

IGBOSON1: The part in bold.....is it giving you a bone/r?

Well Mr Ayo Teriba is entitled to his own opinion!

Mr Ayo Teriba is giving you the official GDP position of all the regions in Nigeri, as stated by NBS.

Pictures speaks a lot than the long grammar. I picked a city from each zone to drive home my analysis and point. Lagos is not part of the equation as it is largely FG developed state. The pictures below is clear enough to tell which region that is looking up both economically and otherwise..

Port Harcourt- SS

Onitsha- SE

Ibadan- SW

Kano- North


The SW has effectively deployed the media to effectively write the news to their advantage thereby hiding their underdevelopment which is only second to the poverty and disease in the North.

the South-East and the North-East contribute the least to the GDP of the country.

The writer tried well to save SE.....
This particular region contributes nothing.
They have never put anything on the table since 1914.

VAQAXY: Pictures speaks a lot than the long grammar. I picked a city from each zone to drive home my analysis. Lagos is not part of the equation as it is largely FG developed state. The pictures below is clear enough to tell which region that is looking up both economically and otherwise..

Port Harcourt- SS

Onitsha- SE

Ibadan- SW

Kano- North


The SW has effectively deployed the media to effectively write the news to their advantage thereby hiding their underdevelopment which is only second to the poverty and disease in the North.

8th Wonder of the world. Brown roof is contributing more to Nigeria, than gully erosion that is contributing zilch aka shishi.

You really need to get the point or you will loose it. Erosion(being controlled) in the SE and SS is a natural cause as well as drought and deadly flood is a natural cause in the North and SW respectively.

We are talking about man-made disaster(mud and rust) that causes cancer and climate change which has become the situation in the SW.

superstar1:

8th Wonder of the world. Brown roof is contributing more to Nigeria, than gully erosion that is contributing zilch aka shishi.

The article was written by a Yoruba man so I am not surprised. I guess all the over 200 oil wells in the South east produce oil that end up in his pot of Gberi Gberi soup or the trading being done in Onitsha and Aba had no impact in the 18% contribution by trading to the GDP or the manufacturing done in Aba and Nnewi isn't part of the 6.6% contribution of manufacturing to the economy.
Foolish Yoruba man.

superstar1:

Mr Ayo Teriba is giving you the official GDP position of all the regions in Nigeri, as stated by NBS.

^^^The NBS only talked of the 6 major areas of economic output that drove the GDP growth! Mr Teriba gave his own take on the situation, though he was kind enough to give reasons why the situation arose in the first place!

VAQAXY: You really need to get the point or you will loose it. Erosion(being controlled) in the SE and SS is a natural cause as well as drought and deadly flood is a natural cause in the North and SW respectively.

We are talking about man-made disaster(mud and rust) that causes cancer and climate change which has become the situation in the SW.

They cannot talk without dragging South South along. No wonder they were dragged into Biafra against their will.

Doesn't the erosion shows you that, even God is pissed off with that land?

I repeat, the 8th wonder of the wonder is -- Mud House is contributing more to Nigeria, than the land of the always migrating sons of Cain.

I do not need to engage you on this because it is obvious you lacks genuine facts. I mentioned SS because they have similar terrain as SE. Igbos are travelers by nature but they are not in yorubarland (Ibadan, Oshogbo, Ekiti, Abeokuta). Some Igbos are mainly in Lagos for obvious reasons, of which one of them is that the city is an FG developed enclave.

SW has a flood problem that which at times make us here in East think that SW is a cursed region.

We are not even talking about the natural disasters yet but man-made disaster caused by yorubars through mud and rust..

superstar1:

They cannot talk without dragging South South along. No wonder they were dragged into Biafra against their will.

Doesn't the erosion shows you that, even God is pissed off with that land?

I repeat, the 8th wonder of the wonder is -- Mud House is contributing more to Nigeria, than the land of the always migrating sons of Cain.