COVID 19 AND THE OIL ECONOMY: NIGERIA MUST SHIFT FOCUS
By Isaac Ochegbudu
On 30th June 2020, the international monetary fund (IMF) made a pronouncement on the impact of covid 19 pandemic on African countries, laying more emphasis on Nigeria and Libya. The crisis is expect put government budgets under tremendous pressure with an estimated total loss in fiscal revenues of $92 billion, Increase debt burdens, etc. After listening to these pronouncement, I was promted to put this piece down.
For a very long time, oil has been the major source of revenue for Nigeria. A lot has been generated from it, however, not enough have been done with the benefits from it to develop the nation, boost the economy and harness other aspect of the economy. Instead, oil has contributed greatly to the underdevelopment of Nigeria. This is because the major beneficiaries of the by-product of oil are the few elites who siphon the gains into private pockets for selfish interest. The leaders of Nigeria (past and present)lack foresight, are apathetic to development and they are the main enemies of Nigeria's development.
I have always seen oil as a major contributor to the plight of Nigeria. Since the discovery of this important economic resource, the country has loosed focus on the way to move itself forward. At the discovery of oil and its economic benefits, the country automatically became a mono-economy shifting its focus from all other aspect of the economy. This has made the economy stagnant. A nation that truly wants to develop do not focus on one aspect of the economy. This is because the holistic investment and engagement in the economy and economic resources of the a nation boost rapid and substantive development. Over reliance on one economic product for economic gain and growth is destructive to the growth of any nation. No country of the has attained substantive and sustained development whole focusing on one aspect of its economy.
The present economic and developmental state of Nigeria is a function of oil and over reliance on it. Because of the economic benefits of oil and how the income from it was, the leaders of the nation shifted attention to it ; not because its benefits to be used to develop the country but because the had plan to accumulate the wealth produce by it to themselves. Truly, the country made a lot out of oil; to the point that one of the past leaders in his time said " the problem of Nigeria is not money but how to spend it"
The present state of oil in the world market has been my prayer for a long time and some other Nigeria's. In my view, the drastic fall in the price of oil intensify the problems of Nigeria and I believe will lead to the diversification of the economy and development in all ramifications. Nigeria, a nation blessed with vast human and natural capital has failed to harness these capitals for growth, thereby making the country and its economy a dwarf. And the neglect of human capital is a major contributor to the neglect of other natural resources a side oil.
The importance of human capital is emphasized in both theoretical and empirical studies. This is because, no country in the world has attained substantive economic development without investing greatly in the human capital and resources available to it. It I'd important to note that, human capital development (HCD) is the development of a nation itself. This is because, humans are the main agents of development. All natural resources and capital are just passive agents of development. It is humans who exploit these resources for their own benefit and create wealth to themselves. Sadly in Nigeria, there is low investment in this great aspect of development and this is why the country is still struggling with underdevelopment.
Human capital\resources refer to the stock of ability and skills of human resource of a country. It refers to the accumulated stock of skills and talents and its manifestation in the educated and skilled workforce of a region. Human capital development on the other hand refers to objective development. It is a way to fulfill the potentials of people by enlarging thier capabilities and implies empowering and enabling them to participate in their own developement.
In Nigeria, there is very low investment in human capital. The human resource of the nation are not valued. The skills and capabilities of citizens are not also valued. These are the reasons why foreign goods are preferred to locally made ones, why the elites seek medical attention outside the country, the children of the elites education outside. The human resource of the nation are underrated, their capabilities and skills not valued. The leaders of the country lack foresight to invest in the human resource of the country. The neglect of human capital development is putting the nation backward.
In the developed nations of the world, capital and resources development is widely appreciated and emphasized. This is one of the reasons do the rapid development of these countries; they invest greatly on their citizens, they harness the skills and potentials of their citizens. These developed nations do not just invest in their human resources but also provide necessary environment for their citizens to explore their skills and potentials. In England for example, sports is a major source of revenue; in the USA, entertainment contribute greatly to the economy. These countries and others have turned this simple human activities into a source of economic gain. It is worthy to note that, this I not the only aspect of the economy they invest in, they also invest in science and technology, education, agriculture, service indusstries etc. Thier economy is a coherent one, where every aspect of the economy are interdependent and interrelated.
In the Arab nations, were there is also a large deposit of oil, they do not only focus on oil but also invest in other aspect of the economy such as sports, tourisim, hospitality etc. There is a huge investment in these activities thereby contributing greatly to their ecobomy. Sadly, Nigeria has not learned from these nations.
The present style of economy and economic activities in Nigeria is an exact replica of the colonial economy. And these shows that we are not yet independent, because, our ideologies (political, economic and cultural) are hinged on and fashioned in the style of our colonial masters.
In the colonial era, the colonialist focused only on a fragment of the economy which is agriculture and a very little of extractive activities, neglecting other aspect of the economy and only engaging in primary production. This is do because, these activities are the one beneficial to the colonialist just as oil is beneficial to our political elites today. The colonialist did not also invest in the human capital too, because, to there is no need and for this reasons they used the colonized as just mere objects of cheap labour. This is why they refused to invest in education. Investing in education will mean investment and development of human capital.
After gaining political independence, the Nigerian economy was mainly agrarian. After a while, the focus shifted to oil. The focus on oil has not provided substantial benefit for the ordinary Nigerian but has only worsen their situations daily. It has also kept the country in a state of backwardness. Despite the great benefits generated from oil, Nigeria still borrow to finance its affairs and thereby keeping the nation in a debt trap. Governments (past and present) have attempted to revive the economy by going back to agriculture, this I see as a blame approach and step that will further crumble the economy. Over 70% of Nigerians are engaged in agriculture but food insecurity and hunger still loom. It is worthy to note that, in the developed nations, only about 5% of the population feed the nation and other nations. This because they have the necessary resources and had harnessed the human resource of their country to boost productions. Until Nigeria shift its focus from oil and begin to explore other aspect of the economy it is yet to develop. The focus on oil has only increased corruption and intensified underdevelopment.
For Nigeria to develop and achieve sustained development and economic growth, focus just be shifted from oil to other aspect of the economy and human capital is very vital and crucial here. The development of human capital through education is vital for the overall development of the nation. Education through literacy provide a foundation for an industrial and post industrial society. This is because, education has the capacity to shape the mental geography of individuals. It refines human and provive then with the skills to confront their challenges and boost development in their society and also compete in the word economy. The ability of nations of the world to compete in the economy of the world is usually affected when a significant number of the population lack basic skills in reading, calculating, thinking and communication. Countries that poses these capabilities tend to progress more than those who lack it.
The nigerian government must start investing in human capital and resources. Once there is heavy investment in people through education and the skills, talents and capabilities of citizens are appreciated, the country is already on a path to development. Nigeria government must invest greatly in education and provide necessary environment for its citizens to explore their potentials. The skills, talents and capabilities of individuals must valued and appreciated. There must be a shift to other aspect of the economy and make the economy coherent in other for the country to move forward and break from the shackles of underdevelopment.
Isaac Ochegbudu
Isaacochegbudu@gmail.com
08106194657, 09047416032
Nice piece
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