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Nairaland Forum / Nairaland / General / Politics / Worsening Giant Of Africa's Economy: Nigeria’s Loss Is Ghana’s Gain (178 Views)
Obi Rejects Insinuations His Loss Is Divine / Fear Grips Diplomatic Community Amid Worsening Insecurity In Nigeria / Nigeria's Loss IS Ghana's Gain (2) (3) (4)
|Worsening Giant Of Africa's Economy: Nigeria’s Loss Is Ghana’s Gain by Nellyvin(m): 12:25pm On Apr 11, 2022|
These are indeed very trying and troubling times for the Giant of Africa as everything seem to be crippling under the Buhari presidency. Insecurity has become hydra-headed with unemployment and inflation assuming an alarming proportion. Nigeria has now become poverty capital of the world with the educational sector under lock and key for months and university roaming the streets aimlessly.
More worrisome is the worsening and humungous debt profile and the wet appetite of the Buhari government to borrow with reckless abandon. The Budget Office’s medium-term expenditure framework and fiscal strategy paper from 2015 showed that the Buhari-led administration incurred N7.63 trillion in domestic debt from June 2015 to December 2020. On external borrowings, President Buhari increased debt from $7.3 billion in 2015 to $28.57 billion as of December 2020. This means that the president incurred $21.27 billion on foreign loans to the country’s debt portfolio. Analysis of consolidated debt showed that the external debt increased by 291.37 percent while domestic debt grew by 86.31 percent in the last six years of the Buhari government. As I write, the government wrote to the Senate to borrow over 4 trillion naira to fund subsidy which the present government says is a scam and fraudulent.
President Muhamadu Buhari rode to power on the plank of change anchored to fight against corruption, insecurity, and improvement of the economy. It is 7 years down the line, his government has left a soar taste on the mouth of Nigerians. It has got to a point a point where Nigerians are asking that the APC led government should return us to the 2015 where a bag of rice was 8,500, a litre of fuel was N86, a kilo of gas was 150, dollar was N150 and life was favourable and life was a little secure.
More worrisome is the dwindling fortunes of the nation’s economy. While most firms are retrenching their workforce, others are closing shops and relocation to neighbouring countries especially Ghana. Babalobi (2021) cited reasons for falling business and divesture of many companies from Nigeria to include unstable energy supplies, insecurity, kidnappings, insurgency, ports congestion, poor railways infrastructure, import dependency of most manufacturing companies, high cost of forex, multiple tax regime, poor social infrastructure, heavy traffic around industrial estates, traffic gridlock to Nigeria major ports of Apapa and Tin can Island, and sharp and shady practices of competitors who import finished products.
The Director, Economics and Statistics at MAN, Mr. Ambrose Oruche, lamented the unavailability of production inputs for most members of the Association, stating it remained a major challenge confronting manufacturer. He attributed the much of the problem confronting Nigerian producers largely to the foreign exchange ban by the CBN on certain items from accessing the official window of the market, adding that the current operating environment remained too harsh for many manufacturers to continue in business. He wondered why for instance the CBN and the Federal Government kept coming out with what he described as conflicting polices that negatively affect the growth of the manufacturing sector.
According to a World Bank Enterprise survey, it is reported that 322 private firms closed down in Nigeria between 2009 and 2014 due to stifling business regulations, corruption, and political environment. The Director of Economic and Statistics Department, for Manufactures Association of Nigeria (MAN) Oluwasegun Osidipe was once quoted as saying 196 manufacturing companies shut down their operations between 2015-2017 due to the biting recession. In a related development, the manufacturers Association of Nigeria, MAN, in its 2017 survey reported that 226 companies have either closed shop or downsized between 2015 and 2016. The National Bureau of Statistics (NBS) also confirmed that about 4.85million jobs were lost within the same period. Nigeria is one of the poorest and most unequal countries in the world, with over 80million of 64percent of the population living below poverty line. Poverty and hunger remain high in rural areas, remote communities and among female-headed households, cutting across the six geo-political zones, with prevalence ranging from approximately 46.9percent in the South West to 74.3percent in North West and North East.
There is a very long list of manufacturing companies and factories that have folded up in Nigeria, space will not permit namely all. Some of the firms are Berec batteries, Exide batteries, Okin biscuits, Osogbo Steel Rolling mills, Nigeria Sugar Company (NISUCO) Bacita, Tate and Lyle Sugar Company, Matches Manufacturing Company, (MATCO) Ilorin, Nigeria Paper Mill (NPM)Limited located in Jebba, Kwara State, Nigerian Newsprint Manufacturing Company (NNMC)Limited, Oku-Iboku, Akwa Ibom State, and Nigerian National Paper Manufacturing Company (NNPMC) Limited in Ogun State.
Others include Nigeria’s six Automobile assembly plants in Nigeria, namely Peugeot Automobile Nigeria limited (PAN) Kaduna set up in 1975, Volkswagen of Nigeria Limited (VWON) Lagos established in 1978, Anambra Motor Manufacturing Limited (ANAMMCO) Emene – Enugu set up in 1980; Steyr Nigeria Limited Bauchi; National Truck manufacturers (NTM) Kano Fiat Production; and LeyLand Nigeria Limited (LNL) Ibadan, (Sunnewsonline, January 2020).
Barely one year after Buhari became President, no fewer than 14 airlines have withdrawn their services from the country due to low. The airlines, including Iberia, United Airlines and Air Gambia, are among the 50 that operated the Nigerian routes some months ago. Besides, foreign airlines operating in the country are estimated to have lost about N64 billion in the wake of the new foreign exchange (forex) policy of the Central Bank of Nigeria (CBN), (Bankole Bernard, 2016). They cited new forex policy, economic crunch and policy summersault which came with enormous negative effect as reasons why the airlines left Nigeria. Apparently frustrated by the low patronage, he said that some of his members were beginning to consider relocating to Ghana, where “their policies are consistent.” Bankole Bernard said.
Newly established factories are not spared the economic harshness as they are also reeling in business misfortunes. For example, in March 2019, GlaxoSmitheKline Consumer Nigeria Plc (GSK) announced plans to shut down its production facility in Agbara by the third quarter of 2021, and hand over production of its consumer health products, medicines, and vaccines to local contract manufacturers.
Similarly, when P&G, manufacturers of the popular ‘Always’ and Pampers brand of sanitary pads and diapers commissioned a $300m production plant in Agbara Industrial Estate, Ogun State, in 2017, it was described as the largest single investment by a non-oil firm in Nigeria. A year later, the company announced plans to shut down the $300 million plant due to high cost of importing raw materials and unfriendly government regulations and policies. The company has also divested from Vicks lemon plus plant in Oluyole Estate, Ibadan, Oyo State. About four years ago, exactly June 30, 2016, United Airlines suspended its daily flight from Lagos to Houston-Texas, and Spanish carrier Iberia on May 12, 2016 also ended its flights to Nigeria from Madrid due to foreign exchange policy and difficulty in repatriating profits.
According to a Sun Newspaper report posted in 2020, Nigeria’s misfortunes has turned to Ghana’s gain thanks to Economic Commission of West Africa’s States (ECOWAS) free trade treaty. Some local businesses have relocated to Ghana, a neighbouring country that enjoys a stable electricity and offers a more friendly business environment. In 2006, two of Nigeria’s leading tyre manufacturers -Michelin and Dunlop relocated their factories to Ghana citing epileptic energy supply in Nigeria as the chief reason.
Babalobi enthused that Ghana is replacing Nigeria as West Africa’s Aviation hub as major international airlines which used to have their regional operational headquarters in Lagos moved to Accra, Ghana. These airlines refuel and route their journey in Ghana after picking passengers in Nigeria. Reasons for their relocation are high cost and scarcity of aviation fuel, poor navigational and landing aids, scarcity, high cost and epileptic supply of JetA1 aviation fuel; obsolete infrastructure and poor value of the naira. Recently, some Nigeria bound flights were diverted to Ghana, causing a national embarrassment. There are speculations that multinationals- Cadbury Nigeria Plc, Paterson Zochonis (PZ) and Unilever as well as Guinness Pls are considering the feasibility and viability of moving their factories to Ghana. Ghana which is fast overtaking Nigeria as West Africa’s leading business hub. A close relation who recently visited Ghana was surprised by large heavy influx of foreign tourists and immigrants. If Ghana manages its fortunes well, it may be on its way to becoming the Dubai of West Africa.
Nearly eight years after, a fairly competent opposition could have dusted up the All-Progressives Congress (APC) campaign template with minor adjustments and run with it in 2023. Which isn’t to say that the Buhari administration hasn’t accomplished certain things in its time in office. The problem is Nigeria’s challenges today are so overwhelming they dwarf whatever modest achievements the president has. He may have gotten trains running and managed to deliver a Second Niger Bridge in the Southeast, constructed roads and bridges, but those are just trickles of good news in a larger sea of bad ones, Festus Eriye (2022).
Eriye is also of the view that insurgency in the Northeast and banditry in the Northwest have devastated the northern economy – with far-reaching consequences for the entire country. Farming has taken a hit along with its supporting value chain and dire consequences for food security. Productive hands have fled, preferring to eke out a living riding commercial motorcycles down South.
WHO WILL HELP US OUT OF THIS QUAGMIRE?
as the 2023 general elections draw near, there is need for Nigerians to decide the kind of President they desire. The problems the Buhari administration has left behind is frightening and may discourage some good and bright hands from venturing into the race. So, what sort of president does the country need at this point, Eriye asked? For starters, we have seen with the incumbent that the hood doesn’t make the monk. The belief that a retired general would do a better job of securing the country has not held up.
At this point we don’t necessarily need a former security operative but a visionary with a plan; someone who understands that the country – especially the North – isn’t going to be stabilised just by bombing forests.
In the words of Eriye, “The next president must be someone who understands business. He should be someone the local and international business community can trust. Nigeria’s current crises will not abate until there’s significant positive movement on the economic front. He must be a unifier who can begin healing to the country not just from the polarisations of recent years, but also from the additional damage that would be done as aspirants go into full blooded battle for tickets of the two leading parties”. Also, there is need for government to holistically tackle insecurity and unemployment. Government needs to do more than raising an alarm or conducting an investigation. The power sector needs to be fixed, policy somersaults on import regulation and tariffs should be avoided, local manufacturing industries should be deliberately protected, and massive investments should be made in social and industrial infrastructure such as roads, railways, and water supply.
The next president of Nigeria must be educated enough to understand the language of money, business and foreign direct investment. He must be one who understands the workings of an economy, has experience in public and private sector. 2023 is a defining moment for Nigeria that we do not have to gamble.
Aluu Vincent a Research Scholar is a Public Affairs Analyst and Publisher of Naija Eye Witness News, 08036688375
|Re: Worsening Giant Of Africa's Economy: Nigeria’s Loss Is Ghana’s Gain by helinues: 12:27pm On Apr 11, 2022|
What's the population of Ghana?
How big is Ghana by landmass?
What's the total economy of Ghana which is almost the same as Lagos state alone..
Anyways, Ghana have never been in competition with Nigeria except from the mischief makers
|Re: Worsening Giant Of Africa's Economy: Nigeria’s Loss Is Ghana’s Gain by ITbomb(m): 1:11pm On Apr 11, 2022|
helinues:Do you know that Lagos alone has population more than the whole of UAE (Dubai inclusive). So it's not about population, it's about what you can offer
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|Re: Worsening Giant Of Africa's Economy: Nigeria’s Loss Is Ghana’s Gain by PetroDolla2020: 4:51pm On Apr 11, 2022|
Abeg, you people should leave Ghana and Ghanaians alone. Ghana is not interested in any giant shit. All Ghana cares about, is making life better for the people of Ghana.
Nigerians should carry this crap giant nonsense thing on your heads. una eyes never clear? Instead of Nigerians talking about something useful, they keep spewing crap!
By the way, why are Nigerians not talking about how to fix their country? They keep talking about useless and needless things while the country keeps going down.
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