Looking Beyond Oil: Diversifying Nigerian Economy: By E-SKY

LOOKING BEYOND OIL: DIVERSIFYING THE NIGERIAN ECONOMY

By

Salis, Kolawole Yusuf E-SKY

   

      Recently, a statement credited to President Obama, drew parallels between the US and Russian economy, outlining the ginormous benefits of a diversified economy over a primitive mono-economy. According to President Obama, the dynamism of the American economy poses big advantages over Russia and many other economies.  In Obama’s words, “they rely on oil; we rely on oil and iPads and movies and you name it.”

In effect of the recent global oil price crash (below $40 per barrel), the economies of prominent petro-states like Russia and OPEC states, have been fuddled by drop in national revenue, leading to the triumphalist quote by President Obama. However, the Obama swipe on Russia could easily have implications for other vulnerable petro-states like Nigeria. In a broader context, President Obama was simply referring to the strengths and resilience that come with a diversified economy.  

Nigeria as an oil dependent state, over the years often chants the diversification mantra but all deem in rhetoric. Successive government and regimes have failed to transform the country into the much desired diversified and industrialized economy. On the contrary, the agricultural sector has suffered neglect and as the country whirled to a leading elephantine in imports. Over a long time, Nigeria has become one of the world’s largest importers of industrial and domestic goods even as the country grows gut in the importation of common tooth picks. It’s no ham for one to say such act irks bitterly.

Sequel to the 2015 general elections that ushered in the government under President Muhammad Buhari, the All Progressive Congress (APC) led President promised to revamp the economy through the launch of “Buharinomics” known for import substitution, diversification and anti corruption war. The new government has constantly emphasized her fortitude to maturate the agricultural sector and animate solid minerals production in the country. But how well can this vision be actualized especially at this present time of lingering oil revenue plump and foreign exchange crises?

In its bid to diversify, Nigeria ratcheted up the economic diversification rhetoric recently at the National Economic Council Retreat where major decisions aimed at stimulating the economy were taken.  Sadly this retreat, like so many others taking place across the country, leave out the world’s biggest winner in the last two decades - the innovative economy, thus missing the “big picture” and creating skepticism about the diversification policy. 

Whilst most Nigerians will welcome reforms aimed at stimulating agriculture and solid minerals, the dearth of policies to serve as impetus for innovations within our economy reflects the lack of understanding of the big wins that can come from a more innovative economy with teeming youths who have cynical orientations about venturing into agriculture.

Nonetheless, diversifying the Nigerian economy remains one effectual solution to salvaging the country from the lingering economic woes and the government must remain resolute in achieving this height if our country must buoy in prosperity and actualize the 2020 vision.

That was why President Obama gleefully touted iPads as the poster card for the innovative economy being driven by US corporations and start ups.

In effect, the present government must be proactive in its diversification policy and develop a framework that will reposition the country as valued commodities exporters beyond brute oil and economic primitive practices.

Author: Salis, Kolawole Yusuf (E-SKY)

(+234) 8032467356

>E-SKY is An Economist and Research Analyst in corporate practice

Dated: Friday 15th April, 2016.