keep on deceiving yourself, a country without electricity. how?

nakedall:

keep on deceiving yourself, a country without electricity. how?

Exactly what @ AjanleKoko is saying; electricity is service oriented. If 1,000 Nigerians like you and I can put $10,000 (I will), that is $10million, we can go a long way of building 4 mini power plants <2.5MW each. Recent reports stated that more than 30% of China's electricity output largely depends on mini power plants strategically located in communities and villages that enable manufacturing and production. Like I've often said and argued with some people; we the people are not helping, the govt WILL NOT change it for us, we have to change it ourselves.

We are farther than the North Pole is from the south on foot! and we haven't started our journey yet!,
Corruption will be the ruin of us as a Nation. Even when we eventually break, we will not have peace , because tribalism will turn from Ibo, Hausa, Yoruba et al to Egba, Eko, Ijebu, et al.

The secret of any develop nation depends stronely on machine machine!!!,  having spent most my childhood here in deutschland and work with a machine company  into production make,s me to think ,  why can,t nigerians never thought of investing heavly on machines,  it only the key to development rather they are busy investing on hosttles, wtf, u can,t keep on importing every little tom&Joystick,  and say your Economy is growing, no,,no,  Till we  start to invest on production/manufacturing machines ,such  as cnc machines. we ani`t headin no where,

Manufacturing, manufacturing, manufacturing is the key factor. Its prevalent presence anywhere globally has attracted and sustained prosperity. In Europe the largest manufacturers have the largest cash reserves, sovereign wealth and least debts - northern Europe as illustrated by Germany. Where manufacturing is falling, failing or none existent those countries are experiencing serious problems - Italy, Greece, Portugal, Spain and the United Kingdom (with its so called huge services industry) In Asia same story - Korea, japan and China are posting more than decent returns. In South America, Brazil is another economy that has seen steep rises in its manufacturing base hence its economy.

The US is gradually losing its competitive advantage hence the contraction in its economy. I personally think that at the end of the day no matter what you have by way of natural resources, no matter how intelligent you are by way of computing and information technology and no matter how enterprising you are in creating paper wealth the bulk of people on earth consume the most basic of things, stuff that endure when wealth creation fails, paper clips to passenger aircraft, cream cakes to containers. The extent a country is able not only to be self sufficient in these products but competitive in the international market place determines its economic fortunes on the long run.

I've also had this feeling for sometime that in the medium term manufacturing has a dampening effect, a stabilizing effect on a country's economic psychology better than most other indices of development. I am speaking of the financial/service sector. I'm sure we are all aware that we have two distinct types of economies. The spend economy (with the US as its chief protagonist) and the save economy (with japan as its leading contender). Obviously to succeed you must have a good balance.

Where you have an extremely strong services sector there is every likelihood that you sooner or later get into a spend habit that racks up credit, raises wages and down the line seeks cheaper products to sustain that habit inevitably leading to massive imports (from countries of cheaper manufacturing) and the cycle of de-industrialization and structural economic problems. It happened to the UK in the eighties, it is happening to the United States now. On the other hand I feel where economies actively resist the advances of strong services sector, curtailing and directing the activities of banks for instance as it is done in China and Germany manufacturing remains strong because quite frankly the country and the tastes of the people remain with what the produce.

Manufacturing is not easy and when the people of a country are accustomed to it tastes for (the best things in life which they cannot possibly earn) are quite curtailed. On a lighter note that's why farmers are not attracted to material things. They simply donot have the time for such and cannot imagine all the effort they put into production going into things they largely donot need. Clearly in Nigeria we have a huge disparity between our tastes and abilities. This is one of the huge engines running the system called corruption. And that's why over the years manufacturing has crumbled and agriculture (another hard sector) is not existent.

So to answer your charge. If the bulk of what I see on your list is insurance, medicare and perhaps telecommunications (the so called driver of the phantom economic growth figures the Federal government is bandying about) then its clear these service sectors IMHO do not represent any real and sustainable economic growth and cannot profit this country and its teeming unemployed youth in any way whatsoever. I mean banks were re-capitalised, they drew huge funds out of our local and some foreign economies but what do we see today, practically everything is lost, leaving everyone - shareholders, workers, depositors at a loss. where has al the money gone. That is the sad effect of paper wealth. It will always be controlled by two factors - greed and fear. But when your wealth is built on tangible stuff, wake up any day and its there.

As a nation, its leaders and its people we are simply not ready to face the challenges of getting our economy on track and ourselves out of poverty. We may yet have to suffer to get mentally and psychologically re-oriented. And if our economy is one commanded by one product, controlled by five companies and the rest of the populace are either contractors or traders, there is practically no hope. I keep on saying it. We are not Saudi Arabia. Wd should quit kidding ourselves and get to work. Real work.

manny4life:


Exactly what @ AjanleKoko is saying; electricity is service oriented. If 1,000 Nigerians like you and I can put $10,000 (I will), that is $10million, we can go a long way of building 4 mini power plants <2.5MW each. Recent reports stated that more than 30% of China's electricity output largely depends on mini power plants strategically located in communities and villages that enable manufacturing and production. Like I've often said and argued with some people; we the people are not helping, the govt WILL NOT change it for us, we have to change it ourselves.

Yes Manny, but electricity in itself does not translate to development. How I love steady power but at the end of the day if all I can do with it is to watch DSTV or chill my beer cans then its pointless and has a negative cost. What we fail to realise is that services in themselves are catalysts not the real products. They boost production, improve efficiency, reduce costs not create production. They are like yeast to flour. They are a demand thing. For example a sector that is ready for stable electricity we can see is the telecommunications sector. They have invested and need a break from unstable power. They are ready. Who else is, very few. That is why though there is a huge potential market out there, there are however no takers for massive investment. The bulk of electricity in any economy is taken strictly by industry. But in Nigeria there are not many. What we have is a nation of potential electricity consumers not users. Bills are not likely going to be paid - corruption.

The same talk was made about GSM in 2002, that it would spur industrial development. Of course it can and I've seen huge benefits in easier and cheaper communications but it hasn't caused the economic transformation we all thought. This is simply because you can only transform what is there. We don't have a real economy so there's nothing to boost. This leads me to think that when in a few years the power problem is solved (hopefully), we would probably identify yet another thing lacking in Nigeria and boy do they abound.

Today there's good electricity in China but it is far from adequate. Same as in India, Thailand. It does not stop them from trying. You need to see some of the dire conditions under which some of our choice goods are manufactured in China and you will be amazed but their competitive spirit has them going and determined to be the world's factory. I think we should have that here.

A good number of our folks here are really trying, I must admit but they are not just enough. I cannot recall how many times I travel across this country each year in search of the most basic of tools and equipment only to end up on the net. Its really frustrating. We are simply not doing enough.

^^^^


I was replying his post in relation to what @OP was saying; service related industries. I wasn't saying electricity solves the economic problem; however, it's the core solution to the economic hinderance in Nigeria. Without electricity, we cannot manufacture, we cannot offer services let alone quality service, we pretty much limited. I am of the opinion that electricity will play an important role to solving one of the major issues in Nigeria.

marabout:

this is the yarn of typical city people.

how many people in okitipupa, otukpo, Otueke have access to bank loans to participate in private sector business ventures?

I know people running shops and other business but never managed to grow big. so the financial situation in PH, lagos, abuja, kano, enugu, Kaduna, Benin and Ibadan  are not same in smaller towns and villages where over 70% of the population reside.

First off, those people do not package themselves well to receive bank loans. You just don't walk into a bank and ask for loans. A bank will most likely not lend to you don't have the following:

1) An incorporated firm
2) A firm with audited financial statements and accounts
3) A Firm with multi-year tax returns
4) A firm with acceptable corporate governance
5) A bankable business plan and feasibility study

They have to be certain that their loans will be paid back and this is how they weed out risky folks. A bank will not lend to a start-up entrepreneur with a 'business idea'. This happens globally. Banks will not lend to informal enterprises and most Nigerian enterprises are informal. If this is no so, how many ventures in Nigeria can meet those five items I listed above.

That is the major reason why most folks don't qualify for conventional bank loans. That is why people in rural areas or those that are sole proprietorships or informal one man business are not bankable. Try getting a business loan in the West and see what they would ask of you. You are better of using your credit cards to start your business or seek venture capitalists or your own savings.

In terms of growth we have not actually been able to understand where we are or the economic challenges we are facing. These problems are:
-Impact of globalization
-Information technology
-The challenges of emerging economy
In other for us to overcome these challenges we need to:
- be innovative
- invest more locally
- people should be allow to contribute:do something unique; going local; become indispensable; be versatile ( language and maths)

We can fix these problems now by:
fixing it now;
end irrational spending - security votes;
invest instead of consuming.
getting the jobs back by making the young work force more competitive
improve education - emphasis on training. retraining and technical education
research more on local contents.

In my opinion, the government role should be geared towards:
-human elements that are actually the catalyst for innovation by putting in place an action plan for renovating and rediscovery of self
-giving innovation tax and exclusions
-setting up innovation funds
-reducing spending on current expenditures

I personally believe that our resolve to be bigger economically is not been tested or pursued from a real sense of urgency. It is also my believe that we are a sleeping giant

manny4life:

^^^^


I was replying his post in relation to what @OP was saying; service related industries. I wasn't saying electricity solves the economic problem; however, it's the core solution to the economic hinderance in Nigeria. Without electricity, we cannot manufacture, we cannot offer services let alone quality service, we pretty much limited. I am of the opinion that electricity will play an important role to solving one of the major issues in Nigeria.

I respectfully disagree. Think about it, our ancestors produced what they consumed without roads and electricity. They were never idle and unemployed or blaming lack of electricity for doing nothing. Why? They were productive. Like Reference said, go to China or even Vietnam or Thailand and see under what conditons people are producing the goods the world consumes. The poverty and deprivation in rural china and india is worse than that of Nigeria yet, they are producing, exporting and saving their money. It is that money that wealthy countries borrow to fund their consumption.

Like Reference also said, our tastes are far greater than our productive capacities and abilities. It is so bad that we subsidize consumption in Nigeria e.g petrol, pilgrimages etc while our foreign competitors subsidize production e.g agriculture, cheap long term loans etc. How can we ever make progress when we want to consume everything and produce nothing? That is why five foreign companies produce 90% of our annual income yet I am constantly told Nigerians are hardworking.

That is why the few folks who actually add value and manufacture goods like cement, flour from raw materials are doing well but the lazy traders want to chase them out of business with cheap dust from rural China! Simply because we want to consume cheap foreign goods at whatever cost

Here here. Ileke-idi to the rescue.

Let me get my MPH measuring tape.

Ok, I'm back.

After hours of deliberation and so so, to better avoid political shenanigans and unnecessary heart attacks. . . . it's better to simply say "Very far".

For The Nigerian economy to grow properly there is a need to have the following:

Aggressive privatisation of government key assets to transfer a good portion of wealth into the hands of the people. This would create in the first instance a good, working middle class (as we can see in telecoms), redirect priorities as regarding education making it less top heavy, and take away much capital flight through skewed foreign participation in sectors such as oil and construction (large employers). The truth is that foreigners dominate both purely based on government patronage with its corrupting tendencies. Me, you, Globacom are unlikely to engage foreign labour en-masse for any considerable period of time and will demand technology transfer. Government simply does not do this. They just hide behind the 'they are better' syndrome. But you cannot make serious progress when you outsource the bulk of your key economic assets.

Secondly, with less government money flowing around, financial institutions will be forced to leverage on the private sector to survive thus creating a real economy. One beneficiary would be manufacturing because it is far less risky than the retail sector. Right now banks have very little incentives to 'get real' because they are saddled with huge funds coming from government agencies that have very little economic value. No one will see cheap money having unserious demands and chase real money having difficult demands. That is why when saddled with excess private capital (through Soludo's move) there was practically nothing real to spend the money on thus the mass stealing. Banks then and now simply do not have the capacity to manage enterprise. They cannot spot potential areas of growth (they have this herd mentality, wait for foreign institutions to light up certain sectors before scrambling for parts) and initiate business.

Finally, the bottom line remains another area where the government needs to come in. As small scale farmers constitute 90% of agricultural production in Nigeria and are thus by far the largest employers, in emerging economies such as China, Thailand, India and Brazil small scale businesses including manufacturing, extractive and construction form an important block in terms of employment and economic growth. What we need in Nigeria is a convergence of points one and two above. Government patronage by privatisation and credits from banks. Even in advanced economies when things get really bad government steps into to directly invest in the private sector by way of stimulus and lower bank rates to encourage borrowing for enterprise.

But when you have a government all too keen to hang onto the reins of the economy for selfish, corruptive reasons and the people largely unwilling to do much for themselves we have this comfortable but rather unfortunate alliance that is called the Nigerian economy.

kalokalo:

I respectfully disagree. [b]Think about it, our ancestors produced what they consumed without roads and electricity. They were never idle and unemployed or blaming lack of electricity for doing nothing.

Kalokalo, permit me to borrow your phrase that ''I respectfully disagree'' with the above.
If our ancestors were self sufficient because they engaged in production of their needs using primitive methods. I would rather say they achieved that by reason of the population and technological development in their time. Times have changed, the need then and now are not the same.

Like i suggested in my earlier post, Nigerians must be ready to go back to agrarian era, where everyone must produce first for self sufficiency, after which we'll think of commercial production; that is commercial production, preservation, marketing and export. some of these products will serve as raw materials for local industries and the success story will be endless but you agree with me that stable power and good roads are vital/strategic to achieve the desired economic growth in modern times.

Take a trip to Sharada and Bompai industrial estates in Kano, go to Ilupeju industrial estate in Lagos, or Oluyole industrial estate in Ibadan. These places were mere shadows of what they use to be in the past. several company has been closed, those still in production were producing sub optimally. Even if we assume that cost of fund and inflation are stable, these companies can no longer cope with the increasing cost of production caused by power (electricity and fueling) and Transportation.
Another issue is that most of the giant companies in this country are in the real sense marketers of imported goods and not producers. Only few engage in real production.

If going back into farming can solve part of problems, I think government can kick start it using the NYSC scheme at as tool to achieve this rather than sending graduate into already saturated labor market. It will address part of the unemployment and production challenges. I remember as a secondary school pupil, agric practical was compulsory for everyone, this is separate from the main school farm with food crops and livestocks in it's stable.

If only farming can be made compulsory to all adults in this country, just imagine the annual output by reason of our population and vast agricultural friendly soil.

Like it's done in Egypt, if government gives fresh graduates or youth corp members some acres of land each and a start-up loan. There could be a revival of the agricultural sector of our economy, and its attendant multiplier effects.


https://www.youtube.com/watch?v=dW8_L8S2w8A

http://www.facebook.com/video/video.php?v=1620056253941

Interesting posts, guys.
I particularly like that one about NYSC having an agrarian focus. In fact, if I had a say, I'd recommend NYSC has a different focus this year, different community development themes. This year it could be agric, next year it could be road works, the next could be water resources.

Keep the comments coming.

Light years.

sleekymag:

Like it's done in Egypt, if government gives fresh graduates or youth corp members some acres of land each and a start-up loan. There could be a revival of the agricultural sector of our economy, and its attendant multiplier effects.


https://www.youtube.com/watch?v=dW8_L8S2w8A

http://www.facebook.com/video/video.php?v=1620056253941

Thanks for the Links- eye opener

Looking at the issue here, one thing comes to mind and that is power. Our development will never appreciate one bit better until government stops politicizing with that sector and give it the fight it deserves.

Reference:

Manufacturing, manufacturing, manufacturing is the key factor. Its prevalent presence anywhere globally has attracted and sustained prosperity. In Europe the largest manufacturers have the largest cash reserves, sovereign wealth and least debts - northern Europe as illustrated by Germany. Where manufacturing is falling, failing or none existent those countries are experiencing serious problems - Italy, Greece, Portugal, Spain and the United Kingdom (with its so called huge services industry) In Asia same story - Korea, japan and China are posting more than decent returns. In South America, Brazil is another economy that has seen steep rises in its manufacturing base hence its economy.

The US is gradually losing its competitive advantage hence the contraction in its economy. I personally think that at the end of the day no matter what you have by way of natural resources, no matter how intelligent you are by way of computing and information technology and no matter how enterprising you are in creating paper wealth the bulk of people on earth consume the most basic of things, stuff that endure when wealth creation fails, paper clips to passenger aircraft, cream cakes to containers. The extent a country is able not only to be self sufficient in these products but competitive in the international market place determines its economic fortunes on the long run.

I've also had this feeling for sometime that in the medium term manufacturing has a dampening effect, a stabilizing effect on a country's economic psychology better than most other indices of development. I am speaking of the financial/service sector. I'm sure we are all aware that we have two distinct types of economies. The spend economy (with the US as its chief protagonist) and the save economy (with japan as its leading contender). Obviously to succeed you must have a good balance.

Where you have an extremely strong services sector there is every likelihood that you sooner or later get into a spend habit that racks up credit, raises wages and down the line seeks cheaper products to sustain that habit inevitably leading to massive imports (from countries of cheaper manufacturing) and the cycle of de-industrialization and structural economic problems. It happened to the UK in the eighties, it is happening to the United States now. On the other hand I feel where economies actively resist the advances of strong services sector, curtailing and directing the activities of banks for instance as it is done in China and Germany manufacturing remains strong because quite frankly the country and the tastes of the people remain with what the produce.

Manufacturing is not easy and when the people of a country are accustomed to it tastes for (the best things in life which they cannot possibly earn) are quite curtailed. On a lighter note that's why farmers are not attracted to material things. They simply donot have the time for such and cannot imagine all the effort they put into production going into things they largely donot need. Clearly in Nigeria we have a huge disparity between our tastes and abilities. This is one of the huge engines running the system called corruption. And that's why over the years manufacturing has crumbled and agriculture (another hard sector) is not existent.

So to answer your charge. If the bulk of what I see on your list is insurance, medicare and perhaps telecommunications (the so called driver of the phantom economic growth figures the Federal government is bandying about) then its clear these service sectors IMHO do not represent any real and sustainable economic growth and cannot profit this country and its teeming unemployed youth in any way whatsoever. I mean banks were re-capitalised, they drew huge funds out of our local and some foreign economies but what do we see today, practically everything is lost, leaving everyone - shareholders, workers, depositors at a loss. where has al the money gone. That is the sad effect of paper wealth. It will always be controlled by two factors - greed and fear. But when your wealth is built on tangible stuff, wake up any day and its there.

As a nation, its leaders and its people we are simply not ready to face the challenges of getting our economy on track and ourselves out of poverty. We may yet have to suffer to get mentally and psychologically re-oriented. And if our economy is one commanded by one product, controlled by five companies and the rest of the populace are either contractors or traders, there is practically no hope. I keep on saying it. We are not Saudi Arabia. Wd should quit kidding ourselves and get to work. Real work.

Nice post, but you cannot easily discount the effect of over $20bn invested in telecoms infrastructure over 10 years, and the creation of at least half a million sector-dependent jobs. And by the way, the Recharge Cards used in Nigeria are manufactured here, at least a N5bn annual industry. Add the e-pins which are more or less a small scale manufacturing business. You're talking about an incremental 100k job addition to the economy.

Healthcare can move in this direction, but private sector healthcare operators are either naive or lazy. There is a requirement for a multi-billion dollar investment in hospitals, equipment, specialized services, drugs, etc. Some are already taking advantage, like the $350m acquisition of Total Health Trust by an SA managed healthcare provider. Foreigners are picking up these opportunities while Nigerians are looking on, and complaining.

The only manufacturing that we can achieve in Nigeria is not going to achieve the kind of revenues that oil can. But if we were not importing Toyotas from South Africa, for example, maybe we should have been producing Toyota brands to service our local demand. India is earning strictly from natural resources and services, and there is no reason why we can't do the same.

Look at China and India. China has a policy of co-operation with major brands, to set up and produce in China. And they have grown significantly as a result. India on the other hand adopted a 'we make our own' policy. The result is that their products are useless for export, and can only be consumed internally.

The truth is, if we take the telecoms approach in every sector, Nigeria will be much better off. We are huge in population, and the service industry can generate enough revenue and provide enough investment that will ultimately lift GDP.

^^ I agree with you on the movement of foreigner into health care, i just heard some indians have opened a hospital in abuja that reduces the need for people to go abroad and a second one is also about to open and a third 500bed hospital is being planned in collaboration with some Nigerians. Our people spend more time grumbling about what we lack rather than opportunities on the ground. Lets just START!

Light Years away. The western world says Africa is a century behind. I say we are a millennium behind. We are only in the same era chronologically.

mrjingles:

^^ I agree with you on the movement of foreigner into health care, i just heard some indians have opened a hospital in abuja that reduces the need for people to go abroad and a second one is also about to open and a third 500bed hospital is being planned in collaboration with some Nigerians. Our people spend more time grumbling about what we lack rather than opportunities on the ground. Lets just START!

Are these indian/SA getting funds from the same banks as Nigerians? are the rates similar to those of Nigerian banks?

Dis Guy:

Are these indian/SA getting funds from the same banks as Nigerians? are the rates similar to those of Nigerian banks?

They're prolly using family or community funds, not bank funds.

Interest rates in India = 8% (central bank benchmark). Actual lending rates 17-20%
Interest rates in Nigeria = 8% (central bank benchmark). Actual leding rates 9.5-12%