₦airaland Forum

In five years, the Buharig led APC Junta has not been able to achieve the least performance of PDP in their 16 years administration. Yet the chronic failures want us to believe that those who out performed them were a waste.

The graph below depicts Nigeria's GDP growth rate since return to democracy twenty years ago. You can all see the consistently high GDP growth rate that we enjoyed before the "change" agents came to draw us back in 2015 and five years later we are yet to achieve the minimum growth achieved under any PDP administration despite relatively high and stable oil prices and massive borrowing.

I really find it amusing when agents of the APC Junta and their misguided supporters have the audacity to denigrate those who performed far better them. If you describe 16 years of solid and rapid economic growth as years of waste, how will you describe the last five years of recession and very slow economic growth?

The current system of federal control of resources and revenue allocation is not only unfair but it is also counter productive as it takes away the incentive for states and local governments to develop the economies of their respective domains and contributing to national development in the process.

As it is today, over 90% of the money accruing to the federation account that is shared between three tiers of government comes from the oil producing states and Lagos state where over 70% of the corporate taxes and customs duty in the country is generated whilst some states are not contributing a kobo to the federation account yet they arrogantly and shamelessly feel a sense of entitlement because our poorly conceived constitution permits it.

For us to develop as a country and to stimulate healthy competition between our states and local government, the control of all resources and corporate taxes within a state should be ceded back to the states whilst they are made to pay an agreed percentage of the revenue they earn to the federal government whilst the federal government retains the control of customs duty but the states in which the duty is generated must also be paid a share in the duty collected in recognition of the state's infrastructure used in generating the revenue.

By so doing we will not only be restoring fairness to the management of our resources as a country, we will be creating incentives for our local and state governments to promote productive activities and investments in their bid to shore up their revenue instead of lazily going to Abuja every month to collect money they never contributed a kobo in making. We will also be integrating the informal sector which accounts for about 55% of our economy into the formal sector whilst increasing our national GDP by up to 100% within a period of five years.

Kunle Oshobi

This old man keeps disgracing himself because of the crumbs he is seeing to steal from this corrupt government. Where are the so called projects?

Iamgrey5:
But not in 2012 to 2014

We had started declining by then, a lot of people errornously give credit to Jonathan administration for the GDP growth rate we experienced that made Nigeria the biggest economy in Africa whilst in reality, the credit should rightfully go to Obasanjo who implented all the economic reforms that led to the growth.

Iamgrey5:
Stop spreading fake news we were never the fastest growing economy in Africa.

Although we are the largest economy in Africa when we rebased our economy..


This 1.9 is a quarterly growth rate figure not yearly growth.

Nigeria was the fastest growing economy in Africa between 2003 and 2009. You need to learn to get your facts right before making statements on the internet.

everest8899:
Well said

Thanks �

Debroslink:
As an economist, you don't rejoice @ a 1.94% growth in GDP without knowing the % growth in population within the same period.

If % growth in population is greater than % growth in GDP, then we are in recession.

Our population growth rate is currently estimated at betwixt 2.6% and 2.8% . As you rightly stated, if economic growth rate is less than population growth rate, we are still experiencing negative growth.

You can always start small

I was once approached by a young man that he needed some capital to start a small business, i was first of all sceptical because i thought he was going to request for a lot of money. The scepticism quickly transformed into curiosity and intrigue when he told me that all he needed to start the business was N2,000. I then proceeded to ask him how he intended to start a business with such a paltry amount and he explained to me that he wanted to start a shoe shining and repairs business and all he needed to buy the tools and materials needed was that amount.
I gladly gave him the money and forgot about it until about a year later when i saw the young man riding an okada. I inquired about the shoe shining business and his response was that with the money he was able to save from the shoe shining business, he was able to make a deposit for the okada and pay the balance in instalment over a period of months. The young man’s transformation was indeed very impressive.
In another similar experience, i was approached by a young woman who explained to me that she was looking for a capital of N2,500 to start a small business, again i was intrigued and i asked he to explain what kind of business she could do with that paltry amount. She told me that she wanted to be hawking oranges on the streets and all she needed was N1,000 to buy a big tray to hawk her goods and N1,500 as working capital to buy half a bag of oranges.
According to her she could finish selling the half bag of oranges by 12 noon each day and make a profit of N600 on it, she could then buy another half bag of oranges which she will finishing selling by 6pm in the evening making her a total profit of N1,200 on a daily basis from a seed capital of just N2,500 only. I was obliged to support her. Though i never saw her again after that day, she was able to convince me that one could make up to N25,000 a month from a seed capital of just N2,500 only.
I also came across the story of a woman who started her food business with a loan of just N5,000. She initially started business as a road side akara seller by using the 5k loan to buy her frying pan, stove and other consumables she needed for the akara business. Sales were quite good for the akara business and she was soon realizing a profit of N3,000 a day out of which she was saving N1,000 daily. Within six months, she had saved enough money to rent a small shop with which she started selling food and started making sales of over N50,000 a day and all this was achieved within a year of borrowing 5k to start selling akara
There is also the story of the young graduate who started selling akara as a result of unemployment, he has done so well with the business that today he has eight branches with about thirty staff working for him. I can go on and on with stories of people that have been relatively successful in business using very little capital that most of us will cringe at the thought of. Whilst many of us might not be able to engage in the businesses stated in my examples above, i simply made them to demonstrate that you don’t need a lot of money to start a successful business. Agreed capital is important but it is not always required in substantial amounts to start a business, what you need is more of determination and discipline to start and run a business successfully.
Some people have even started their businesses without investing a dime as commission agents whilst some people sell services that don’t require monetary capital to deliver. You can change your world today by starting something no matter how small if you are dedicated enough to nurture it and allow it to grow, you can move from zero to hero and become an employer of labour instead of someone looking for employment. It’s all in the mind and it’s your choice to make, you can always start small.

grandstar:
Why are Nigerians always fixated with "save" foreign exchange! What is meant by "save"?

When one picks up to read the best magazines in the world such as The Economist or Forbes, you never read "save foreign exchange". It is never there.

Even when Donald Trump placed tariffs on many Chinese made imports because of China's protectionist policies, no one ever wrote how much "foreign exchange was saved" by such the US. The only time you ever see "save foreign exchange" in these magazines are when Nigeria pays for a special editorial trying to promote the country.

The best way to manage foreign exchange is by making the currency flexible. If imports are too high, the currency will depreciate in value and therefore make imports less affordable and locally produced products more competitive. If the Central Bank believes that the currency is depreciating fast, they will raise rates which will encourage investment in treasury bills will will take money out of the system and thereby deprive the money of funds to buy forex thereby reducing pressure and hence, a strengthening of the currency.

There is no way cement manufaturing can create more jobs that the building and construction sector. No single. I very much doubt it can produced even a tenth of the workforce in it. Take it from me, cement had adverse effect on the construction sector. If you think what I am saying is baseless, let the government lift the ban on cement and you'll see price of cement drop and people will buy from the cheapest supplier.

Cement is a special product by the way. The price is extremely sensitive to transport cost because of its low price and bulky mass and that's why cement plants are located all over the country. To ship a trailer load of cement worth 1.5m for instance up North may cost up to 600,000. That's 40% of the price of the price of the goods. Imported cement therefore may not pass beyond the the South of Nigeria.

Price of a bag of cement in Thailand ranges from about 1,200 to 1,450. Dangote's price is at least 2,500 per bag. I repeat Nigerians got burned by the ban.

How will the price hit 3,000? What evidence is there that it will hit 3,000?

If the price of imported cement will hit 3,000 or be higher than the locally produced one, why was Dangote eager that the license to import up to 1,500,000 metric tons of cement yearly granted to Obat Cement be revoked? What you said here about the price hitting 3,000 is untenable.

When it comes to the term "saving" of foreign exchange which you have issues with, you have to realize that Nigeria is an import dependent country and and demand for foreign exchange puts massive pressure on the Naira. Our ability to save foreign exchange means less pressure on the Naira and a better exchange rate. The countries you used as example do not have their economies structured the way our economy is.

I agree with you on having a flexible exchange rate but if it's flexible and your imports are excessive, you will end up killing your economy. The best thing to do is to promote local production and be less import dependent. That said going to your argument that the construction industry provides more jobs than the cement Industry, this argument is simply not tenable as they actually compliment each other and the construction industry has not been negatively affected by the cement Industry, if anything at all, it has benefited from it.

Concerning the prices of cement in Thailand that you referred to, are you sure that the price you quoted is current and the right exchange rate was used? Is the price wholesale or retail price? Does it factor in the cost of production in Thailand as opposed to Nigeria? Does it also factor in the cost of transportation, distribution and profit margins of the retailers? Does it factor in the tax rate in Thailand as opposed to Nigeria? Really there are so many factors to consider before reaching a conclusion but which ever way you want to spin it, Nigeria is better off producing cement than importing it from foreign countries.

Another point to note is that importation of cement was never banned but merely restricted to only importers that were investing in local production of cement and apart from Dangote, there are at least eight other companies in the country that were allowed to bring in cement, if Dangote's cement is too expensive, why aren't all the other cement manufacturers/importers under cutting his prices?

grandstar:
The achievement in cement was done at great cost to the economy. More jobs were lost than was created as it made locally produced cement very expensive and had a very negative effective on the building industry.

Also, his protectionist policies such as the ban on textiles and poultry into the country were also counterproductive

I very strongly disagree with you on your position here. Do you realize that Nigeria now saves $3 billion per annum as a result of the cement policy? Do you realize that the price of cement would have been at least N3,000 per bag if we were still importing cement due to the current exchange rate of the Naira? Do you know how many hundreds of thousands of jobs were created locally as a result of the cement policy? Do you know that it is as a result of Dangote's success in the cement Industry that empowered him to be able to raise funding to build the world's largest refinery in Nigeria? Do you know that Nigeria will save $10 billion annually and earn an additional $6 billion when the refinery is fully operational? Don't let antagonist mislead you with the illusion of cheap cements being imported then, I can assure you that it is currently cheaper to produce cement in Nigeria than to import and in fact Nigeria now exports cement to neighboring African countries. The benefits of the cement Industry far out weigh the imaginary short comings you listed above.

Whilst exchanging banters on Facebook regarding why Buhari was not invited to the recently concluded G7 summit despite the fact that leaders of smaller African countries were invited, i recently made a post which elicited a lot of response and controversy (It’s been shared over a thousand times and elicited over a thousand comments as well) in which i stated that Nigeria became the fastest growing economy in Africa under the leadership of Obasanjo and as a result of this Nigeria gained respect amongst global leaders and the country was regularly invited to participate in important global economic events.
Whilst it is an incontrovertible fact that Nigeria became the fastest growing economy in Africa and the second fastest growing economy in the world under the leadership of Obasanjo (several data from reputable institutions worldwide confirm this), i was challenged based on this statement by a lot of people i assume to be Buhari/APC apologists and supporters who did not like the idea that their “enemy” had succeeded where their idol had failed woefully. While it was obvious that some of them were just being antagonistic and in obvious denial, i will concede that some of them were actually ignorant of the giant economic strides that the country made under the Obasanjo/Atiku Administration because their administration then did not embark on chest beating, noise making and propaganda that has become the hallmark of the government today. It is because of the genuinely ignorant ones that i decided to write this article to set the records straight.
When Obasanjo resumed power in 1999, Nigeria was a pariah state as a result of the tyranny of the Abacha administration, the country was in huge debt and had challenges servicing her debt obligations, oil price was very low at less than $15 a barrel, our foreign reserves was just $3 billion and the economy was in a general state of lethargy. Everything that could possibly be wrong with the economy was wrong with it and the future looked very bleak. Undeterred Obasanjo set to work on the arduous task of restoring confidence to the country and re-building the economy.
To start with, Obasanjo leveraged on his massive international connections as a highly respected global leader to get Nigeria back into reckoning as a member of the global community. He then set off to build institutions to strengthen governance and the fight against corruption which was the biggest problem holding the country back as at that time. Amongst his achievements in this regard are the following;
• He created the Economic and Financial Crimes Commission (EFCC) and empowered them to effectively fight corruption without fear of favour. (The achievement of the EFCC under the Obasanjo administration remains unparalleled to this day).
• He also created the Independent Corrupt Practices Commission (ICPC) another agency of government to strengthen the fight against corruption.
• He set up the Budget Monitoring and Price Intelligence Unit (BMPIU) otherwise known as Due Process office to monitor the budget and ensure that government contracts were not inflated. The unit was ably headed by the no nonsense Oby Ezekwesili and as a result of this, the country saved Hundreds of billions of naira from cutting down inflated contracts
• Under the Obasanjo administration, the practise of open bidding for oil blocks was introduced. Prior to this, oil blocks were awarded on a discretionary basis by the military to their cronies. As a result of this, the country was able to generate billions of dollars from the sale of oil blocks and signature bonuses which had hitherto remained in private pockets.
• Although the National Administration for Food and Drug Administration and Control was set up by the Babangida administration, it did not become an effective organization for fighting fake drugs and corruption until Obasanjo injected life into it by appointing the enigmatic late Dora Akunyili to head the parastatal and empowered them to fight the incidence of fake drugs in the country to a standstill.
• To reduce wastage in government, Obasanjo promulgated and signed the Fiscal Responsibility Act into law thereby legally committing all tiers of government to fiscal prudence in public financial management and inter governmental fiscal co-ordination to secure greater macroeconomic stability.
While the Obasanjo administration was embarking on these laudable reforms to strengthen governance through building of institutions to fight corruption and reduce the cost of governance, they also embarked on several economic reform initiatives which all added up to unleashing the potential of the Nigerian economy and saw the country’s economy emerging as the fastest growing economy in Africa. Some of the landmark economic reforms embarked on are enumerated as follows;
• Privatization of Public enterprises: When the Obasanjo administration resumed office in 1999, the government was by far the biggest player in the economy being the owner of most of the large companies in the country. Unfortunately, these companies were very badly run and most of them had become comatose with the few surviving ones being heavily in the red. In line with the reality that the private sector was better equipped to own and manage businesses, the federal government embarked on a privatization exercise and in the process, government was able to make billions from the proceeds of the sale of these companies whilst further saving billions in subventions they were paying to keep the hailing companies afloat. The companies were eventually re-invigorated by the private sector and today a good number of them are contributing to the growth of the economy instead of being the drain pipes that they previously were.
• The administration paid off our national debt of $35 billion which had become an albatross through a negotiated settlement thereby massively improving on Nigeria's sovereign ratings and making it possible for Nigerian banks/private sector access the international financial market for capital to fund growth.

• Banking reforms: enough has been written about how the Obasanjo years banking reforms increased the capitalization of banks in the country by over 300% and catapulted at least five Nigerian banks to become amongst the largest in the world but the real beauty is that with larger capital base Nigerian banks now have a lot more resources with which they can finance economic activities and growth.

• Bond market: Prior to Obasanjo's regime the bond market was
virtually non existent, today it is worth over ten trillion naira and is a
veritable source of long term funds for development growth which the government of the day mostly depends on to fund it’s activities.

• Pension reforms: In my opinion, this is the most uncelebrated and understated achievement of the Obasanjo regime. Apart from the primary goal of taking care of the future retirement needs of today's workers, a huge pool of funds has been created which can be channeled in various sectors of the economy to finance economic growth. Today the total pension funds have exceeded 9 trillion Naira and still growing at a phenomenal rate. The strength of our financial service industry today is largely dependent on the long term accumulated pension funds.

• Capital market boom: Due to Nigeria's improved sovereign
ratings after Obasanjo paid off our National debt and our sound macro economic fundamentals, foreign investors poured in and stock market grew exponentially from a market capitalization of about 600 billion Naira when Obasanjo assumed power in
1999 to well over 10 trillion Naira when he left power in 2007.

• Telecoms revolution: So much has been written about the
phenomenal success of Obasanjo's telecoms revolution that it would be a waste
of time repeating it here again. It's to his government’s credit that we have
over 150 million active phone lines today up from 400k lines in 1999 representing a phenomenal growth rate of almost 30,000% in the industry.

• Backward integration of the cement industry: Nigeria today is a net exporter of cement thanks to Obasanjo's policies of stimulating local production by giving incentives to local manufacturers. Today hundreds of thousands of jobs have been created down the value chain and Nigeria now saves billions of dollars in foreign exchange that would have been used to import cement.

• Foreign reserves: By the time Obasanjo left power in 2007, despite the fact that by then he had paid off our external debt and he met only $3 billion in our foreign reserves when he assumed power in 1999 he was able to leave almost $50 billion in our foreign reserves with about $22 billion of it being in our excess crude account. It was with the huge savings he left that Nigeria was able to survive the global financial crisis that brought the western world to it’s knees between 2008 and 2010.

• Power reforms: Now this is a very controversial one as many people would like to assume that the Obasanjo administration failed in this regard but
nothing can be further from the truth. Even though today power supply is still abysmally low, Obasanjo laid the foundation for power reforms in the country. Although he did not stay in office long enough to complete the projects he started and the succeeding governments have been slow in completing these projects. It is on record that Obasanjo’s government initiated the National Integrated Power Project (NIPP) which has the capacity to solve our power problems in the interim if well implemented. Under the NIPP Obasanjo commissioned the building of 11 new power plants across the country three of which he was able to commission before he left power and others were in various stages of completion. These power plants were designed to add over 5,000 Megawatts to the national grid thereby doubling our national power supply in one fell swoop. Though all sorts of ridiculous figures have been brandished by detractors as the amount spent on the power projects with “noting to show for it” it was later confirmed after thorough investigation that only $3.08 billion was released by the Obasanjo administration for the project and today most of the power plants have now been completed even though due to laxity of the government of the day, they are not supplying power to the national grid.

As a result of the prudent management of the country’s resources, institutional fight against corruption and dynamic economic policies of the administration, the country’s economy grew rapidly, millions of jobs were created and Nigeria attained an all time high of 19.17% in it’s economic growth rate in the fourth quarter of 2004 positioning the country as the fastest growing economy in Africa. The rest of the world also started viewing Nigeria as the next economic giant along with the BRICS countries. It was also as a result of the rapid growth that Nigeria attained during the Obasanjo years that necessitated the need to rebase our economy during the Jonathan Administration and it was discovered that Nigeria had actually overtaken South Africa to become the largest economy in Africa in terms of GDP.

Even though Nigeria is yet to attain it’s full economic potential, it will be very uncharitable to deny the phenomenal achievements of the Obasanjo/Atiku administration in significantly growing the countries economy and laying an even more solid foundation for it’s future growth. Politics asides, history will indeed be kind to them based on what they were able to achieve with the country’s economy.

http://parrotnigeria.com/how-obasanjo-made-nigeria-africas-fastest-growing-economy/

Perfectbeing:
No matter the explanation, an average Nigerian won't understand the increment of power.. It's just like explaining to Nigerians why fuel should be increased..

Whether they understand or not should not stop government from doing the right thing, after all providers of other goods and services are free to determine the price of their products/services. Why restrict the all important power sector?

tactius:
Therein lies the problem

Any government, APC or PDP or any other party that removes power subsides, allowing for an increase in cost of power...is going to get removed by popular revolt.

But the problem is, this is the only way. We cannot afford to pay subsidy for power...FHS.

If our government is bold enough to do the right thing rather than being politically correct, over $100 billion worth of investment can be attracted into the power sector and it will create a lot of multiplier effects into the economy.

Before the advent of GSM technology into the Nigerian telecoms sector which brought with it a revolution in the industry, Nigeria had less than 400,000 active telephone lines which were mostly landlines and a few thousand mobile lines across the whole country. Though the prospects of GSM technology was very promising then, no one anticipated that the market will grow to become as big as it has become today.
Even the marketing prospectus of the Nigerian Communications Commission (NCC) which was designed to entice potential investors to invest in the industry had estimated that Nigeria had a market potential of just 10 million mobile subscribers and companies like Vodacom(which was then the biggest GSM operator in Africa) declined the opportunity to invest in the country based on the wrong assumption that the Nigerian market potential was too small.
This was to become Vodacom’s biggest investment mistake as not only did Nigeria exceed all expectations regarding the market size, Nigeria became the fastest growing telecoms market in the world and Vodacom lost their position as the biggest operator in Africa to their arch rival MTN who had taken the “risk” to invest in the Nigerian telecoms sector. From less then 400,000 in 2001, telecoms subscribers in the country grew to be in excess of 150 million subscribers by 2016 translating to a phenomenal growth rate of 30,000% over the fifteen year period.
How was Nigeria able to achieve this feat in the telecoms sector? The simple answer was that the federal government deregulated the sector and allowed private sector operators to profitably invest in the telecoms sector. The assurance of profits encouraged the operators to invest heavily in the sector and through economies of scale, the operators were even able to reduce the cost of connection and tariffs as more and more people subscribed for their services.
The telecoms sector is similar to the power sector as they are both services initially provided by government monopolies. However whilst the telecoms sector has been deregulated and handed over to the private sector for better and more efficient performance, government still continues to hold back the power sector through regulation that inhibits the productivity of the sector.
In reality, there are only two problems holding back the power sector in the country today and they are both politically motivated. If the government can summon up the courage and make policy pronouncements to rectify these problems, without the government investing a kobo, they will set the power sector and by extension the economy on a path of phenomenal growth similar to what was attained in the telecoms sector a few years ago.
The first major problem with the power sector is that, even after the privatization of the industry, government still dictates at what prices the electricity companies can sell the power they distribute and generate. Unfortunately the approved tariffs are far below the operational costs of the power companies and as such they are not able to service their existing bank liabilities talk less of raising funds to finance the necessary expansion that will be needed to solve our power problems.
Government needs to allow the power companies to be reasonably profitable for them to be able to invest in expanding their operations and improve power supply in the country. Once the tariff issue is sorted out, 90% of the problems plaguing the industry will be resolved. Nigerians also need to be ready to pay higher electricity tariffs if we want to enjoy stable power supply in the country.
The other major problem inhibiting the power sector in the country is the national grid system. The national grid system is one that requires most of the power produced in the country to be put on the national grid for re-distribution to various parts of the country. Transmitting electricity over long distances results in loss of power. For instance, as much as 60% of the power transmitted between a distance of Port Harcourt and Kano is lost during the transmission process which results in irrecoverable losses to the generation companies. These loses that power companies are forced to make as a result of the national grid system acts as a major disincentive to investments in the power sector. To solve this problem, we must eliminate the national grid system and allow the power companies to distribute their power as they so desire. i.e we opt for a regional grid system.
The solution to the power problems as enumerated above might sound over simplified but the reality of the matter is that it is all about profits. Profits is that one thing that has the ability to move mountains and if our power sector was made profitable to current and prospective investors, like our telecoms industry, the power sector will attract huge investments that will see power problems becoming a thing of the past in the country. In reality the power sector has the potential to attract over $100 billion worth of investments within the next ten years if only the sector is made profitable enough for it to be viable.
The multiplier effect that this potentially huge investment in the power sector will have on the economy both directly and indirectly is best left imagined. The question now lies with us; Are we ready to pay higher electricity tariffs to reap this benefit and does our government have the political will to implement the policies that will solve the problems and transform the industry into one that will be a catalyst for economic growth.

Commentaries and feedback can be sent to: kunleoshobi@outlook.com

The world is fast coming to the end of the era of Oil as a source of energy yet our government is busy investing billions in their elusive search to find Oil in the northern part of the country instead of looking elsewhere for sources of income to prepare the country for a world after oil.

AutoJoshNG:
https://i1.wp.com/autojosh.com/wp-content/uploads/2019/03/regina-daniels-rolls-royce-wraith.jpg?resize=423%2C532&ssl=1


Regina Daniels is among those actors who started acting at a very young age. She started acting at the age of seven.

For some years now, there have been side talks about her controversial age which is 16. Many claimed she has been on that age for long.

As young as she might be, she has acquired some properties multi-million properties recently which has also raised eyebrows as to how she amassed such wealth.

She first of all started with buying herself a Mercedes Benz ML350 SUV; she got a mansion for her mom and few hours ago, she got a Mercedes Benz C300 for herself again.

This time around, she is spotted sitting pretty in a Rolls Royce Wraith. We don’t actually know who the owner is. Can you guess?

She captioned it:

Class is permanent!! TGIF!!�� Have a blast guys….


https://i1.wp.com/autojosh.com/wp-content/uploads/2019/03/regina-daniels-rolls-royce-wraith-2.jpg?resize=426%2C531&ssl=1

https://i1.wp.com/autojosh.com/wp-content/uploads/2019/03/regina-daniels-rolls-royce-wraith-3.jpg?resize=424%2C531&ssl=1


Source: https://autojosh.com/regina-daniels-rolls-royce-wraith/


Lalasticlala
Mynd44
Ishilove
Marpol
Semid4lyfe
Obinoscopy
Seun

The owner of the Rolls Royce is obviously the one paying the bills.

In today’s rapidly transforming global economy, the only thing constant is change. Businesses that are not keeping up with the trends or are unable to adapt to new disruptive technologies and innovations will sooner or later find themselves out of business.
There are a few examples of market leading companies that went down as a result of not reading their markets right and being unable to keep up with innovations within their industry. Fifteen years ago, Nokia was the market leader and dominant player in the mobile phone industry accounting for over 30% of mobile phone sales globally. However the market changed very rapidly due to several innovations in the industry but Nokia had become complacent as the market leader and did not innovate as quickly as the market was transforming. By the time they realized, it was too late. The market had moved on and they were left bankrupt.
Another industry that has been rendered obsolete is the photographic film camera industry were the two leading players; Kodak and Polaroid failed to respond adequately as digital photography caught on in the 1990s. Ironically it was Kodak’s research team that first came up with the digital camera in the early 1970s but they failed to develop the technology because the company made more profits from the sale of films than from the sale of cameras and they didn’t want to loose that revenue stream. As a result of the failure of these companies to innovate and adapt to disruptive technologies, both companies have since filed for bankruptcy and gone under.
Bearing in mind what these disruptive innovations are doing to industries all over the world and the consequent effect on those that refused to adapt, it makes it imperative for us as a nation to plan ahead to avoid the consequences of not adapting to change and going down like those who refused to adapt.
The Nigerian economy is one that is largely dependent on crude oil revenue to sustain it’s economy given the fact that crude oil accounts for 70% of government revenues and 90% of export earnings. As a result of this, any disruption in the crude oil industry will greatly impact on the Nigerian economy.
Today there is a big push away from using crude oil(fossil fuels) as the primary source of energy globally. Apart from the fact that global oil reserves are fast depleting, due to environmental concerns, there is a concerted effort by Western and some Asian countries to phase out the production of cars using fossil fuels and concentrate more on the production of vehicles using renewable energy. As a result of this some countries have even gone to the extent of passing legislation on dates to phase out vehicles powered by fossil fuels.
German car manufacturers are presently investing over 60 bilion euros in the building of electric car factories, likewise China, Japan and Korea are making similar heavy investments. Tesla an American car manufacturer that specializes strictly in the production of electric vehicles is currently the fastest growing car manufacturing company the world and virtually all major car manufacturers in the world are scaling up their production of electric vehicles. All these point to the fact that the world is moving away from fossil fuels as a means of powering our vehicles and this will clearly result in a global decline in the demand for crude oil.
A fall in the global demand for crude oil will translate into a fall in price of the commodity as time goes on and countries like Nigeria that depend heavily on the commodity will be greatly impaired if we fail to respond to this pending disruptive innovation that is staring us in the face. Apart from the loss of revenue, oil producing companies will loose a lot of their value as a lot of the assets in the industry become obsolete.
Nigeria has heavy investments in the petroleum industry through the government owned NNPC that is estimated to be worth anything between $300 billion and $500 billion. In twenty years time when the real effect of the disruption in the industry would have fully set in, the value of this investment may not be worth up to $10 billion. This is apart from the sad reality that the industry will no longer be bringing in any appreciable revenue into the coffers of the country.
The good news is that we still have enough time to plan ahead to mitigate against this impending loss to the economy and strengthen our economy to remain relevant in the emerging global economy.
Government should as a matter of urgency through transparent bidding that will be handled by the World Bank sell off all it’s investment in the oil sector and the proceeds of the sale should be invested in Human Capital Development and our sovereign wealth fund. By so doing we will be able to save the country hundreds of billions of dollars due to depreciation that will happen in the oil industry whilst at the same time we generate huge revenues that can be invested in preparing Nigeria and Nigerians for a world after Oil.
There are fears in certain quarters that government will cease to make revenues from oil if it sells the NNPC. This is not true as government will still continue to make revenues from the oil companies through royalties and petroleum profit tax after these companies are sold. What they will forfeit is production sharing from the Joint Venture companies that would have been sold off. Also savings will be made form selling off the loss making arms of NNPC that constitute a huge drain pipe in the coffers of the nation. With the selling of NNPC government can now focus mainly on the generation of taxes to meet it’s financial needs. Given that our current tax to GDP ration is less than 5%, there is a lot of opportunity to significantly improve government’s revenue in this area when we take into cognizance that some of our fellow African countries have tax to GDP ratios of up to 20%.
The sale of NNPC presents the best opportunity for government to cut off it’s dependence on oil, develop other sectors of the economy whilst at the same time generate funds that will be needed to transform our economy from one that is dependent on oil to one that is dependent on our most valuable resource which is human resources.
In my next article, I will be writing on Human Capital Development and why it’s the key to Nigeria’s long term sustainable economic development.
Feedback and commentaries can be sent to kunleoshobi@outlook.com

cc: seun mynd44 lalasticlala

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APC will claim this as another innovation during Buhari's era

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You're the one twisting it. It is very clear and straight to the point, "my brethren"

Matthew25:40 And the King shall answer and say unto them, Verily I say unto you, Inasmuch as ye have done it unto one of the least of these my brethren, ye have done it unto me.

Read in proper context from verse 31, Jesus made it crystal clear that his brethen he is referring to are the poor and less privilege.

Better still he should be sent back to Sudan from were he will be picked up to face charges for crimes against humanity at the Hague.

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Don't be doing hasty generalisation, the year is young. What Jesus said was to give preference to Himself/God above the poor. It's good to help poor brethren, but not all the poor are brethren and not all the brethren are poor.

Jesus said giving to the poor is the same as giving to him or God. Don't get it twisted. If you want to give to God, give to the poor. You don't need to start twisting scriptures to suit your agenda.

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GOD BLESS OUR PRESIDENT MUHAMMADU BUHARI as he takes us to a land flowing with milk and honey, AKA the NEXT LEVEL.

Thank you God for giving us the best President in the history of our darling country

Don't let God strike you dead with this heresy and mockery of the most high.

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And what if the poor is not "my brother"?

Jesus considered the poor as his brethen, if you think they are not your brothers, you can't possibly be a follower of Christ.

Entrance into Millennium Park, 11-11, with the Old Masonic Lodge at the top of the picture across the road.

Sights of Calabar like this with the evident green set backs all over the town supported by the people increased, and are a symbol of, the pride for Crossriverians.

We also took pride in the legislation to save N50m per month by the government for a rainy day, which saw his administration leave N4.8b in this Savings Account at the end of the Administration in 2007.

Tinapa Film Studios, original site of Ebony Life Television.

In a country suffering from the peculiar effects of a characteristic cultural dearth of physical public infrastructure, and the development-economic cost consequences of the logistics deficits such entails, only a rare visionary like Donald Duke realises the essential, crucial, and INEVITABLE role of Technology, Media, & Telecommunications (TMT) as are being converged into one sector by the internet, in the future turnaround of society.

Lacking in such physical infrastructure, and being largely a mutant state in which such deficits are economically almost impossible to surmount, this area, with its dependence on invisible, thereby impossible to touch, infrastructure, is the veritable easiest way out of our economic woes.

Media entertainment, its professional-intellectual quality productions that is, is our most probable and most possible major seller to the developed mind of our contemporaries all over the world. There are few things we can produce to any quality close to theirs and for their consumption, as intellectual content ... and the internet is continuing to explode new galaxies of opportunities with which we may do so and earn thousands of times more than we can from more than the oil and gas we possess, if we can only have leaders, unlike in the PDP and APC, who understand this fact and invest in its potentialities accordingly as Donald Duke had.

I spent two and a half years in the State during the tenure of his successor Administration, and this entire, basic, development-economic concept, was, is, and forever will be, impossible for their leadership to grasp.

Instead of housing a vibrant professional media-entertainments industrial sub-sector as it was envisaged to begin with, and then expanding to spurn media villages next door and to grow out of an obvious natural connection, through the Tinapa Business Park, to Dubai Media City, this brilliant economic potential ended up merely housing the production studios of Ebony Life TV.

A British carpenter, built Ebony Life studios and the sets of movies like Pirates of the Carribbean, trained many locals, and reared to grow.

What a waste!

Giant Hands artwork in another one of Calabars pristine public parks.