That Nigeria has the potential for becoming one of the world’s leading economies as a result of its vast human and natural resource endowments is a known fact. Sadly, this has not become the case for the “giant of Africa” as the country’s intrinsic capacities have remained largely unexplored and underutilised over the years. With an economy that has been majorly dependent on crude oil and gas since the late 1960s till date, the nation’s growth has continued to be driven by consumption and high oil prices. This has left the citizens ill-equipped and unprepared to deal with the recent collapse of crude oil prices and production in the global markets, a trend that led to the economic recession recorded in the second quarter of 2016.
In its attempt to tackle these and other underlying issues with the nation’s economy, the current administration since inauguration, has made a number of efforts to put the country on a steady and steep path to economic growth and stability – possibly changing the trajectory of things for the better.
At its inception in May 2015, one of the initial actions was to prioritise three policy goals that focused on tackling corruption, improving security and re-building the economy. As a result, the Strategic Implementation Plan (SIP) for the 2016 Budget of Change was formed as a short-term intervention; recording some evident accomplishments. Nevertheless, continued stress on the economy indeed reflected that a lot more was required to push the nation towards desired developmental goals.
The Economic Recovery and Growth Plan (ERGP)
The ERGP is a medium term plan for 2017 – 2020 which builds on the previously established SIP with the aim of restoring economic growth in the country, “leveraging the ingenuity and resilience of the Nigerian people.” It attempts to rearticulate the role of the government in the 21st century as more proactive in meeting the needs of the citizens by considerably eradicating the impediments of progress, while leveraging on Science, Technology and Innovation (STI) as the drivers of a knowledge-based economy.
The ERGP is essentially both a recovery and growth plan hinged on three broad strategic objectives. The plan is envisaged to act as a roadmap for the short term recovery of the Nigerian economy and a strategy for a long term sustained growth and development by;
- Restoring growth through macroeconomic stability and economic diversification: The plan proposes to achieve macroeconomic stability by embarking on fiscal stimulus, ensuring monetary stability and improving external balance of trade. To achieve economic diversification, the plan seeks to focus its policies on key drivers and enablers of economic growth like agriculture, energy, MSMEs, manufacturing and other services that leverage science and technology.
- Investing in the people: The ERGP proposes to create opportunities and provide support for the Nigerian people by increasing social inclusion, creating jobs and empowering the youth, as well as improving the human capital.
- Building a globally competitive economy: On the plans to restore Nigeria’s economic growth, the ERGP intends to increase the competitiveness of Nigerian businesses by investing in infrastructure, improving the business environment and promoting digital-led growth.
Despite the clearly laudable objectives of the ERGP, the question is, why has there not been significant progress with economic stability, especially in direct positive impact on the lives of citizens?
It has been suggested that information on the ERGP was based on outdated macroeconomic projections from Q3 2016 that have been affected by both external and internal changes. The obvious volatility in the global economic environment, further decline in world oil prices, disruptions to oil production, crude oil theft, pipeline vandalism, Niger Delta militancy, increased interest rates from developed country markets, among other factors continue to affect the ability of the country to attain its growth projections. Moreover, a sustained slowdown in emerging markets like China, or protectionism in the markets of developed countries seem to reduce the appeal of Nigeria as a likely investment destination.
In addition to these, a weak private sector, inadequacies in proper infrastructure – power, road, rail projects, inexplicable occurrences like drought, flooding, inadequate rainfall are also factors affecting the attainment of the strategic objectives of the plan.
Nonetheless, the success of the implementation of the ERGP will be hinged on the commitment of the government to deliver on the objectives outlined in the plan. Based on the stipulated approach as captured in the plan, the following points may be considered to facilitate the successful implementation of the plan;
Focusing on priorities: The plans for the implementation of these strategies as laid out in the ERGP require the combined efforts of the Federal, State and Local Governments, as well as the private sector, international donors and the civil society, working together on activities like; investments in agriculture and food security, energy (power and petroleum products), transportation, infrastructure, industrialisation and MSMEs, to achieve the goals. All of these are the fundamental issues that drive economic growth in a thriving society.
Monitoring and driving progress: As a buffer for all of these concerns, the Presidency has set up the Delivery Unit to support efforts by the Ministry of Budget and National Planning to see to the implementation of the ERGP. In addition to monitoring progress, the Unit is saddled with the responsibility of evaluating the progress of the plan alongside targets and milestones, as well as act as a guide to avert potential pitfalls, which if done right can yield the desired results in no time.
Establishing clear accountability: In addition to the Delivery Unit who will also work with the MDAs, State and Local Governments and the Ministry of Budget and National Planning to “drive implementation and ensure accountability,” there is also the need to include private sector participation in the accountability process for the claim by the FG to foster better relations between the public and private sector to be credible.
Allocating resources to priorities: The FG has proposed to fund the ERGP primarily through the budget. However, the same budget is currently forecasted to be at a deficit of N7.6 trillion from 2017 – 2019. For these plans to make any headway there may be need to consider looking outward to private sectors and working with developmental partners who can synergise with the government to see to the actualization of the stated plans.
Communication: The FG can augment its plans to adopt various means of articulating its progress to the different stakeholder groups by also making concerted efforts to properly orientate the public on the ERGP, provide progress updates and clearly outline how the plans affect the public even to the grassroots level.
The FG can also work to foster mutually beneficial relationships with foundations, bilateral and multilateral grants organisations. Tech billionaire and founder of the Bill and Melinda Gates Foundation, Bill Gates during his recent visit to Nigeria at the Expanded National Economic Council on Investment in Human Capital in Abuja, opined that of the different strategic areas highlighted in the ERGP, the Federal Government should focus more on human capital investment. This may very well be a call to other organisations and individuals to take a stand and champion their personal agendas.
Apart from the government, the private sector needs to identify ways to plug into the specific areas highlighted in the plan and make efforts to drive progress in those aspects. Interestingly, encapsulated in the ERGP is the innovative drive to change the relationship between the public and private sectors, and foster a closer relationship between the two sectors.
Strategic synergy between the public and the private sectors, can play a crucial role in structural progress in the economy; one that will be more diversified and inclusive, reflective of favourable outcomes in a stable macroeconomic environment. Moreover, the nation should have attained a restorative growth in GDP, transformation in agriculture and food security, sufficient power and petroleum products, improved stock of transportation infrastructure, industrialized economy, job creation and youth empowerment, improved foreign exchange inflows.
Federal Republic of Nigeria Economic Recovery & Growth Plan (2017 – 2020): The Ministry of Budget and National Planning.