 |
| Akinwunmi Ambode, FCA |
Despite
boasting the biggest economy in Africa, Nigeria’s economy remains largely
undiversified with crude oil sales accounting for over 90 per cent of total
revenue. As a result, our economy is always vulnerable to volatilities in the
international oil market coupled with the impact of many years of corruption
and wastage. This is the reason for our present economic nightmare.
It is very
unfortunate that we wasted the golden opportunity to deploy the trillions of
dollars earned from our oil exports to develop the critical sectors of the
economy including power, agriculture, industries, solid minerals, transport
infrastructure among others. No doubt, if we had done the right thing as some other oil producing
countries did, keeping in mind that crude oil is a finite resource, we would
not be experiencing the devastating effect of oil price crash on the scale we
are experiencing it now.
We are now being forced to do, with pains, what we should have done with
ease years ago. The task of charting a new direction for the economy is not
going to be a tea party. Various policy options must be identified and
assessed on the basis of our current situation and needs.
Moving our
economy forward requires thinking outside the box and doing things differently.
We need creativity, innovation and the courage to take difficult and tough
decisions.
The leadership of the country at national and state levels
must have the courage to take tough decisions and make sacrifices in the near
term which will, in the long run, make our economy stronger and sustainable
and, consequently result in prosperity across all regions of Nigeria.
One way to revive our economy
will be to explore and expand inter-state relations, strengthen regional
competitiveness by maximising economies of scale, regional optimisation of
assets and endowments and mitigation of afflictions and natural disasters.
Other potential areas for inter-state collaboration include transport
infrastructure to facilitate market linkages, education, market development,
human capacity building, security and intelligence sharing, among others.
I must stress, however, that this idea is not an
entirely uncharted territory for Nigeria. Prior to the oil boom era,
agriculture was the mainstay of Nigeria’s economy and contributed about 65 per
cent to the country’s GDP and represented close to 70 per cent of total
exports. Through farming, Nigeria was able to feed its population while major
cash crops were exported to earn foreign exchange.
From the cocoa and rubber plantations in the then Western
Region, the groundnut pyramids and cotton in the then Northern Region, to palm
oil in then the Eastern Region; each region was identified by its economic
areas of comparative advantage which were collectively harnessed towards
ensuring food security and inclusive growth across the country.
Given our current economic challenge, I believe it is time we
took a cue from our old “playbook” for a viable “game plan” to revive our
national economy. States and regions must once again begin to leverage on their
respective areas of comparative advantage by establishing partnerships towards
establishing inter-state or inter-regional commodity value chain. We must
re-start inter-state/regional cooperation.
It was in realisation of this that Lagos and Kebbi states
signed a Memorandum of Understanding a few weeks ago. Kebbi State is the
largest producer of rice in Nigeria while Lagos State, the most populous state
in Africa, consumes rice, mostly imported rice, worth N135bn annually. With
this partnership, which covers food production, processing and distribution,
Lagos and Kebbi states have taken steps to explore our areas of comparative advantages
to achieve food security for Nigeria and save our foreign exchange. In specific
terms, this collaboration will produce 70 per cent of Nigeria’s rice
demand. The multiplier effect of this collaboration will be felt in the
areas of job creation, the development of ancillary industries, the
strengthening of our local currency against the dollar and other major
international currencies.
I believe more of this
inter-state collaboration should be encouraged as a major driving force for the
diversification of the economy. There are many more areas of
collaboration to be explored in the nation. The political leadership must
develop the will to make this initiative work, to achieve food security and
promote backward integration for industrial growth.
I wish to state at this point
that Lagos State has always embraced inter-state cooperation as a strategy to
fast-track economic growth and development. Prior to the agreement with Kebbi
State in the North-Western part of the country, Lagos State had collaborated
with states from within the old Western Region in the areas of comparative
advantage for the partner states.
Lagos State currently has 84
hectares of land in Osogbo, Osun State, out of which 20 hectares is used for
palm produce, while others are used for rice farming, cassava and maize. The
state also acquired additional 1,000 hectares of land in Osun, 500 hectares in
Ogun and Oyo each and 50 hectares in Abuja to support farming. In addition, all
granite used in construction in Lagos State are being sourced from quarries
located in Ogun State. These relationships have proved especially beneficial
for Lagos State given its low land mass and the rapid urbanisation and
industrialisation in the state.
It must however be noted that
for regional or inter-state cooperation to yield the desired result in terms of
enhanced inclusive growth, we must put in place a functional modern rail and
water transport system. The movement of goods, materials and people by road is
not only inefficient but fraught with risks, safety hazards and detrimental to
our roads.
The
Lagos/Kebbi initiative for example will involve movement of thousands of tons
of paddy rice to Lagos for processing in the mills. This can only be achieved
more efficiently through a modern rail system which at present remains largely
undeveloped.
Ambode is the Governor of Lagos.
No comments:
Post a Comment