mrvitalis:

It’s evident you don’t even know the meaning of infrastructure.

Below is the definition of infrastructure. The people you think you are borrowing the loan will fail woefully in their business without infrastructure.

Have you ever wondered why people are more in urban centers than rural areas? Infact what make a place urban and what makes a place rural? Where does business thrive more? Rural or urban?

So if your country is looking like 19th century village, how will people excel in the first place even if you share 1million each for them in business?

Major difference between developed and underdeveloped countries if infrastructure. Without infrastructure, there is no incentive to grow.

On Awolowo example you gave, if they had not truncated the democracy back then, Ibadan would have been one of the best city in Africa. At least we can still see those Western Region built edifice, if Awo had shared the money along people for business, the war would have cleared their profit and we will still not have any edifice to remember the good old days.

the basic physical and organizational structures and facilities (e.g. buildings, roads, power supplies) needed for the operation of a society or enterprise.

mrvitalis:

Why can the tax generated from that trade pay for the rail ?

do you know how much is cost to move 30 tons of goods from one location to another in Nigeria.

okeysoninv:
do you know how much is cost to move 30 tons of goods from one location to another in Nigeria.

Less than 500 dollars

LegendHero:


It’s evident you don’t even know the meaning of infrastructure.

Below is the definition of infrastructure. The people you think you are borrowing the loan will fail woefully in their business without infrastructure.

Have you ever wondered why people are more in urban centers than rural areas? Infact what make a place urban and what makes a place rural? Where does business thrive more? Rural or urban?

So if your country is looking like 19th century village, how will people excel in the first place even if you share 1million each for them in business?

Major difference between developed and underdeveloped countries if infrastructure. Without infrastructure, there is no incentive to grow.

On Awolowo example you gave, if they had not truncated the democracy back then, Ibadan would have been one of the best city in Africa. At least we can still see those Western Region built edifice, if Awo had shared the money along people for business, the war would have cleared their profit and we will still not have any edifice to remember the good old days.

You obviously didn't read my write up
When there is limited resources , revenue is down what should you do ? Invest in more infrastructure ? Or create access to credit

Which has a higher chance of creating employment n increasing revenues

It makes zero sense to borrow to build infrastructure

mrvitalis:

Less than 500 dollars

lie, it takes more than a million to move a container away from Lagos. Even within Lagos is more than 500,000. Imagine if the rail line moves 100 container per day . Check the multiplier effect.

Another onitsha illiterate

okeysoninv:
lie, it takes more than a million to move a container away from Lagos. Even with Lagos is more than 500,000. Imagine if the rail line moves 100 container per day . Check the multiplier effect.

Let's say it's 2 million ...how many container does Nigeria receive per year ....so a struggling nation like Nigeria right now have absolutely no business building rail lined now

Rail line system now would cost nothing less than 15 billion dollars ...so if Nigeria is given to you right now you would borrow 15 billion dollars to build rail ?

Airlord2030:
Another onitsha illiterate

Counter it nah bro if u can

mrvitalis:

Let's say it's 2 million ...how many container does Nigeria receive per year ....so a struggling nation like Nigeria right now have absolutely no business building rail lined now

Rail line system now would cost nothing less than 15 billion dollars ...so if Nigeria is given to you right now you would borrow 15 billion dollars to build rail ?

800,000 thats for container import alone..i will not talk about grain, chemical , liquids , petroleum etc that's doesn't come through container .cost of rail line even if it's 1000km will never $15b. Highest $6b

This is a very educative thread where we all can learn and I would appeal to all to reduce the insults , back to the topic, while I understand you , I do not totally believe investing in human capacity through loans would better suit us long term against infrastructure, we can do both with percentage of priority, the loan system and trusting economic growth into the hands of corrupt capitalist can be severe for us as well, I will give examples

When Dangote was given license for refinery, loads were given licenses too, infact many of those given license were incorporated into the subsidy scheme to enable them raise profits and capital towards their huge venture during Jonathan, that was the begining of major corruption with the subsidy as they just abandoned the idea of refinery and instead focused of given ridiculous numbers for the fuel they imported and were taking billions in subsidy payments. Another is the anchor borrowers scheme for rice farmers, the plan was for them too build rice mills within a time frame after being given license to import rice, none of them that collected govt loans and license to import rice built any mill while some just started and left it at that. How many were built ? When the banks pursued Ben -Murray Bruce over its billions of loan he owed to setup all his cinemas, did he scream witch-hunt and cry that it was cause he was opposition, didn't he brag that he had created thousands of jobs and all would be lost if amcon took over his business ?, didn't the same people criticized the govt of wanting to make thousands loose their jobs ? Same with licensing for sugar , cement etc. Pausing infrastructural developments to fund loans to different investors in the belief that they would create jobs thereby increasing human capacity and lessen unemployment would not really achieve 25% of its aim but rather build overnight billionaires.

mrvitalis:



Between rail and providing access to credit which would yield more economic development

Both can be done by the state, main issue which i believe is why you made this post is due to nigeria's debt to revenue{https://nairametrics.com/2023/05/15/okonjo-iweala-warns-over-nigerias-alarming-debt-service-to-revenue-ratio/}.

Nigeria has too low of a budget for an economy of its size, the government doesnt effectively collect taxes and relies too much on oil exports for its budgetary income. that is the true issue at hand, people wont like it but nigeria needs to tax its citizens and assets within its economy effectively.(Its Tax to GDP ratio is abysmal, compared to the world and african standard).
https://www.oecd.org/tax/tax-policy/revenue-statistics-africa-nigeria.pdf

Maazieze:


Both can be done by the state, main issue which i believe is why you made this post is due to nigeria's debt to revenue{https://nairametrics.com/2023/05/15/okonjo-iweala-warns-over-nigerias-alarming-debt-service-to-revenue-ratio/}.

Nigeria has too low of a budget for an economy of its size, the government doesnt effectively collect taxes and relies too much on oil exports for its budgetary income. that is the true issue at hand, people wont like it but nigeria needs to tax its citizens and assets within its economy effectively.(Its Tax to GDP ratio is abysmal, compared to the world and african standard).
https://www.oecd.org/tax/tax-policy/revenue-statistics-africa-nigeria.pdf

and you think the best way to grow revenue is more Infrastructure?

okeysoninv:
800,000 thats for container import alone..i will not talk about grain, chemical , liquids , petroleum etc that's doesn't come through container .cost of rail line even if it's 1000km will never $15b. Highest $6b

6 billion from where to where

mrvitalis:

6 billion from where to where

is more than 800b naira that's for container alone. Then other cargo ships that comes with bulk. Nigeria rail Transport would amount to $10b annually. I have given u instances already .

mrvitalis:
and you think the best way to grow revenue is more Infrastructure?

best way to grow revenue is to improve tax collection, thus raising nigeria's tax to GDP ratio, thus reducing its debt servicing to budget ratio.

also removing the wasteful fuel subsidy helps

okeysoninv:
is more than 800b naira that's for container alone. Then other cargo ships that comes with bulk. Nigeria rail Transport would amount to $10b annually. I have given u instances already .

You are saying $10 billion would link all Nigerian cities by rail...have you seen the container movement map ?

Maazieze:


best way to grow revenue is to improve tax collection, thus raising nigeria's tax to GDP ratio, thus reducing its debt servicing to budget ratio.

also removing the wasteful fuel subsidy helps

Or just grow taxable people by providing access to credit

Like obi said u invest in the people then tax them

mrvitalis:

You are saying $10 billion would link all Nigerian cities by rail...have you seen the container movement map ?

I said the volume of container would amount to $10b annually. Even if it cost $50b to connect the whole Nigeria it worth it. The investment will be recop after 5yrs.

mrvitalis:

Or just grow taxable people by providing access to credit

Like obi said u invest in the people then tax them

No need for an "or" it should part of the plan of building a stable tax base

Let's take lagos Ibadan and Abuja Kaduna ..is any of this rail making profit ? ...why not ? ...how many container has Lagos Ibadan moved ?

But are running at a loss so section should rail be used ?

You think it rail is profitable business won't invest into it ?

Maazieze:


No need for an "or" it should part of the plan of building a stable tax base

Increasing tax base should be what we need to do but putting money into infrastructure now is a waste especially borrowed money

We need to break even first ... revenue should be more than debt servicing n recurrent expenditure before u think of infrastructure

Debt servicing n recurrent expenditure is over 3 times revenue n you want to borrow to build infrastructure instead of investing to increase revenue collection base

Maazieze:
I wonder what informs your economic perspective, its terribly warped.
The idea of building up infrastructure to encourage growth is not an idea developed by awolowo, its a real life phenomenom that we saw occur in europe and china and now india!

dont trust only my word, actual economists say so: https://blogs.worldbank.org/digital-development/how-does-infrastructure-support-sustainable-growth

The only infrastructure we need now is road, hospitals and educational centres. We don't need rails, stadium, gigantic structures... and unnecessary airports.

We are poor. Infact, we are swimming in poverty. The best way out of this whole mess is productivity. If we can produce 40% of what we consume, it will go a long way in curbing unemployment, poverty and crime.

For decades, we saw no need of refining the fuel we consume. Infact, west Africa imports fuel from non-oil producing countries like India, England.. It will be better if government grant loans to private business men to set-up local refineries and capture the West-african market than building train stations which ends up being vandalized because the people you intend to make comfortable are poor... and an hungry man is an angry man.

For now, we don't need certain infrastructures. We must fight poverty with everything we have got and the only way to do that is by being productive. Any nation that depends on others for what they consume will always be poor.

I'm beginning to wonder why China only gives loan for infrastructure and not other productive ventures.

mrvitalis:

It makes zero sense to borrow to build infrastructure

Very false sir, all around the world government borrows to fund major infrastructure. Even in countries with supposed good revenues.

Maazieze:


Both can be done by the state, main issue which i believe is why you made this post is due to nigeria's debt to revenue{https://nairametrics.com/2023/05/15/okonjo-iweala-warns-over-nigerias-alarming-debt-service-to-revenue-ratio/}.

Nigeria has too low of a budget for an economy of its size, the government doesnt effectively collect taxes and relies too much on oil exports for its budgetary income. that is the true issue at hand, people wont like it but nigeria needs to tax its citizens and assets within its economy effectively.(Its Tax to GDP ratio is abysmal, compared to the world and african standard).
https://www.oecd.org/tax/tax-policy/revenue-statistics-africa-nigeria.pdf

Nigeria should be generating nothing less than 100bn dollars from taxes alone, we barely generate up to 30bn.

Nigeria annual budget should be nothing less than 150trn if really we want to hit developed standard...

A mere 25trn is our annual budget where almost half of can't be funded by our revenue and we call ourselves giant? Omo this country really bad.

The greatest service any economic team can do is to try to improve revenue from mere 10trn currently to over 40trn in the next 5 years,
Cut down on inflation, and increase oil sales to pre 2014 era.

mrvitalis:

Or just grow taxable people by providing access to credit

Like obi said u invest in the people then tax them

True Talk. But Nigeria prefares to tax the industries and not the people. While advance world taxes the workers and give tax incentives to the industry. That's why you see bigger corporations paying less tax, some billionaires even pay less taxes than the middle class.

It's time to expand the tax base, tax the people more than the company.
If the company hired more tax them less, you can recoup your money from the workers. This creates a positive ripple effect.
It reduces unemployment rate
It expands the tax base to generating more revenue
It makes the government accountable, as a well taxable community will demand for their due.

Infrastructure like roads, rails, energy develops an economy and nation.

Efewestern:


The only infrastructure we need now is road, hospitals and educational centres. We don't need rails, stadium, gigantic structures... and unnecessary airports.

We are poor. Infact, we are swimming in poverty. The best way out of this whole mess is productivity. If we can produce 40% of what we consume, it will go a long way in curbing unemployment, poverty and crime.

For decades, we saw no need of refining the fuel we consume. Infact, west Africa imports fuel from non-oil producing countries like India, England.. It will be better if government grant loans to private business men to set-up local refineries and capture the West-african market than building train stations which ends up being vandalized because the people you intend to make comfortable are poor... and an hungry man is an angry man.

For now, we don't need certain infrastructures. We must fight poverty with everything we have got and the only way to do that is by being productive. Any nation that depends on others for what they consume will always be poor.

I'm beginning to wonder why China only gives loan for infrastructure and not other productive ventures.

Very false.
The point we fail to understand is that we need infrastructure. This your statement here is still why we are here today.
You said back then we didn't prioritize our refinery and as a result we are affected now.
Same way you said we shouldn't build stadium, rails and big buildings now, do you know the impact this can have on us later? Same way we are comfortable importing fuel with subsidy before, well we are comfortable without rail for now.

Also no country, I repeat no country in the world fund major infrastructure without borrowing, you can't build everything on revenue alone, if you do you'll be restricted on critically needed infrastructure and this will have a long term impact on your economic growth.
This will be like a déjà vu we refuse to learn from. Same way we accuse the former leaders of not building infrastructure, of not creating a strong power supply plan, of not prioritizing our rail, roads, refinery and it's adverse impact on the Nigeria of today, that will be the same way your grandchildren will view you if you didn't engage in rigorous infrastructure building.

Government is not a profit running ventures in fact many countries requires budgeting for critical infrastructures. Many mega projects runs at a loss, but that doesn't stop government intervention and development of other project. Infrastructure and HDI goes hand in hand, and if you really want to develop to better standard, infrastructure takes the larger chunk.

manutdrichie:


Why not invest on stable electricity instead of rail?

They are doing both some power plants will be commissioned this year.

mrvitalis:

Many Nigerians believe the fallacy investing in Infrastructure drives development ; this is a massive problem ,I believe this started with awolowo and his socialist and the idea stuck ,Baba was building cocoa house , nta ,Nigerian house ...big project that offers no economic benefits...how much does cocoa house generate today ?
Runing government is like running a business ...GDP is likened to business revenue ( turn over ) while government revenue is business profit

None economically viable project are like beautification of your office/business premises , people can say this man has best office space , it's pleasing to the eyes but has little or no impact on your business ...tho they are important, a struggling business like don't need beautification , we need revenue and profit ....we owe too much and can't fund our business expenses so we borrow ....but instead to buy more goods we use it to beautify our office

Nigeria don't need rail lines , we dont need second Niger bridge for now !!! our profits can't even pay staffs yet we borrow to repaint our toilet n change toilet sits to world class ones ,does that make sense ?

You need loan to buy more goods to make more profit .. in government it's creation of new tax payers by providing easy and cheap access to credit in areas you have identified we have a comparative advantage

Let's take lagos to Ibadan rail for example...it cost us about 800 billion plus .... employs less than 3000 people ,still needs government funds to run ... addition to GDP almost zero ,net revenue negative

Now imagine same 800 billion given to banks at an interest rate of say 3% banks to give them out at 10% ...each business has 3 years before loan repayment starts ...

Conditions access the loan
you must a Nigerian or lived here constantly for 15 years

You must be a business that has export potential ( your production cost must be less than international price )

Or

You must be a business that want to produce goods we import at a price less or equal to the products landing cost


You must be willing to employ 50 Nigerians minimum pay should be 300k monthly

You can get 2 billion to 10 billion

Let's say average of 6 billion is given out

133 businesses would be created ... employing minimum of 6666 jobs

If those business make an average profit of 2 billion yearly ...Nigerian profit tax is 20% ....that's a guaranteed 53 billion per year

Employee tax is 15% I think ...that's extra 36 billon per year ...that's 89 billion yearly ... remember after 3 years interest and loans payment starts

Say 40% if the business failed

You still get 53 billion in revenue as a government ....this can comfortably cover for the 40% failure of business n debt servicing would be an issue ...GDP would grow by over 2 billion dollars

But no we built rail

I would bee doing a series on this to defend my ideas ...Nigeria must move from this socialist mindset and be more capitalist to grow

Your analysis above does not make sense. Government abandoned agriculture all over the country to face oil exploration when oil was discovered not only cocoa in south west. And this is one of the reasons for unemployment, hunger, shortage and high cost of food in Nigeria now.


Take it or leave it. Infrastructure and security are very essential to kick start the economy and Nigeria is yet to start. That rail you used as example is not even the beginning.


Infrastructure serves the people not the government. The rail may generate low income as you claim but saves people the stress and cost of transportation. The money is saved in people's pocket not the government.

mrvitalis:

You people still don't understand me ....what I'm saying is if you have money to do one
Focus on access to credit ...let infrastructure be carried out by profit generated

Is buying a guy not important ? Is building your house not important ? They are

But what would you call a business man that used his profit or borrowed money to build house or buy cars

Infrastructure is not necessarily business adventure as you are putting it. It is dividend that people enjoy as citizen to saved them of stress and enable the citizens to keep more money in their pockets

Hospital, good road, bridges, rail, etc saved the citizens of cost and stress. They are not primarily meant to put money in government purse.

You may think Lagos Ibadan rail is not raking in billions, but saves alot of time, energy and retain money in the pocket of citizens that are using it and that is the objective.

What purpose is Eiffel tower serving in Paris? But if you value it it may cost Billions of dollars


but people moving around it, spent their time there will put more money in the pocket of vehicles that convey people there,

people relaxing there may not fall sick and spend time and money in the hospital

OP doesn't understand a thing about economics. Writing off importance of infrastructures shows you need somebody to start teaching you basics of economics.
In no time a business of 2b naira will collapses without good infrastructures. Infrastructures is one of the major thing investors consider before taking a step towards investing in a country.
Our poor infrastructures is what actually cause low investment in the country. We need more rails that can move people within 30mins or 45mins to next state to encourage investors.