Vision, National ideology, Economic outlook, National development, Dutch disease, and Africa’s lost decade Introduction icon

Vision, National ideology, Economic outlook, National development, Dutch disease, and Africa’s lost decade Introduction


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Robert U.P. Idemudia & Prof. Sunday A. Idahosa

Looking into the Seeds of Time: The Processes, Dynamics and ideological Mix for National Development in Nigeria’s Vision 20 (2020)


Robert U. P. Idemudia, Ph.D.

&

Prof. Sunday A. Idahosa, Ph.D.


Abstract

The Vision 20: 2020 is a Perspective Plan of Nigerians targeted at making Nigeria one of the twenty most developed economies in the World by the year 2020AD. The focus of this study is to evaluate the critical variables that are contingent on national development anchored on collective social and economic actions with ideological mix, efficient and effective use of the budgetary process, minimization of resource leakages, credible, transparent and legitimate governance, mobilization through strategic engagement of the mass media for public awareness, and a general cooperative framework of public-private sector-partnership. The study concludes that these constructive engagements of critical qualitative variables of development coupled with attitudinal change on the part of all as orchestrated in the Seven-Point Agenda, with President Umaru Musa Yar’Adua on the “Driver’s Seat” on the journey to make Nigeria by 2020 one of the 20 largest economies in the World, the study proved that there is hope that the objective will be achieved.


Keywords: Vision, National ideology, Economic outlook, National development, Dutch disease, and Africa’s lost decade


Introduction


The Research Problem

The World is changing at a fast rate in the areas of industrial, agricultural and even in cultural spheres. New Nations are pressing for emergence. The “Asian Tigers” and some African Nations are seeking to displace the monopoly of today’s world’s political and economic equations. As it was in the Ancient Period when Rome was the “centre of the world,” until the on-set of the Middle Ages, usually said to begin with the fall of Rome in 476AD and continue until around the year 1500AD when New Nations, notably those of Western Europe, emerged under the Age of Renaissance followed by the era of scientific discoveries, so it will be in the on-coming age. This trend culminated in the leadership of the United States as a pivotal economic, industrial and political power after the Second World War, in 1945.


In the new World order, however, it is not expected that the mode of power shift as experienced in the middle Ages, which ultimately culminated in the various centres of power in Europe and later with the ascendancy of the United States after the Second World War would obey the same trend. Goldman Sachs, the World Stockbrokers Institutional Expert and Consultant was the one who first predicted the on-coming shift in world economic leadership having accentuated the great progress achieved by what he calls the BRIK – Countries (Brazil, Russia, India and China) and projected that they would take their places amongst the ten largest economies by 2025AD and that China could even become No. 1 by 2040. The other countries according to him, are Bangladesh, Egypt, Indonesia, Iran, Korea, Mexico, Nigeria, Pakistan, Turkey, Philippines and Vietnam (Goldman Sachs: 2007). It is noted that amongst the eleven countries, Nigeria was put as No. 7 .In adopting the Report, the Federal Government of Nigeria reduced the projected period by five years, bringing the target date to the year 2020, in which Nigeria would become one of 20 leading economies in the world by that year, and coined the phrase as “Vision 20: 2020”.


Given the current developmental strategies being evolved by Nigeria, can it attain the status of becoming one of the twenty most developed economies by the year 2020? This would appear a tall dream. The Minister of National Planning, Dr. Shamsudeen Usman in inaugurating the Think-Tank for Vision 20: 2020 asserts that Nigeria is currently in the 40th position in the global ranking, charging the Committee to start the:


preparation of the background papers in thematic areas for the Vision 20: 2020 document which would move Nigeria from its current 40th position in global ranking to becoming one of the 20 economic world powers in the next 11 years (Usman: 2009).


A pre-survey conducted in respect of this study reveals some basic problems that could militate against the realization of Nigeria’s set dream. These include:


  1. Inappropriate ideological framework resulting in social class cleavage of extreme poor and a few extreme rich acquired through looting of Government treasury by political officeholders.

  2. Macroeconomic conditions (involving investment in the areas of interest rates inflation, openness of the economy, Government Deficit and External Debt)

  3. Lack of technological capacity involving (computer penetration, communication development, Internet Access)

  4. Human Capital Development in area of (Education and Life Expectancy)

  5. Unconducive political Environment (political instability, Rule of Law; and corruption, inefficient government bureaucracy, poor work ethic in national labour force, crime and theft)

  6. Poverty, exacerbated by globalization of the current global financial crisis.

Nigeria is an economy with extreme and bipolar social structure with a few who are extremely affluent and a large majority who are poor and a dwindling middle-class which is vanishing hence it is bipolar. The affluent few get their wealth and riches from “chop-chop” politics, meaning politics of graft and looting of public treasuries by politicians and public officeholders including the top echelon of the bureaucracy.


Given this situation, what strategies would Vision 20: 2020 adopt that will cure first, the ills in the Nigerian political system? What strategies would bridge the gulf between the extreme rich and extreme poor in Nigeria? The free-for-all activity of amassing wealth through embezzlement of public funds by the political class has generated negative feedback on the Nigerian society leading to many social vices currently plaguing Nigeria. These include armed banditry; political assassination; kidnapping of foreigners, particularly those in oil mining sector; kidnapping of some wealthy indigenes who have “made it.” Both foreigners and indigenes were being kidnapped by these reactive social elements for ransom. Other crimes include crude oil bunkering; oil pipeline vandalization to siphon crude oil and refined petrol for sale in the “black” market; sometimes leading to fire outbreaks “roasting” many innocent poor alive who scampered for petrol that leaked out from the pipeline for quick money; and many other heinous crimes.


This Nigerian social malaise would appear to be the by-product of lack of appropriate ideology for Nigeria. Can the prevailing capitalist ideology which has been upturned by the “Nigerian factor,” lead Nigeria to the Promised Land which Vision 2020 seeks to pilot Nigerians.


Because of these pervasive grafts, development of infrastructures such as physical infrastructure (state roads, federal highways, railways), social infrastructure (Health facilities to promote healthy living, educational facilities, water supply for citizenry’s productivity); Institutional infrastructure (decayed police posts and police equipment posing threat to national security, electricity supply to propel the productive and real sector of the economy), are impeded with consequential hampering of domestic trade and socioeconomic activities.


Given these scenario, the question can be put, has ideology any promotional role in National development? Will the capitalist system as currently practised in Nigeria with abject poverty afflicting over 72.1 percent of the populace (UNDP: 2006) and the attendant abuse of the capitalist system by a few political class enriching themselves at the expense of the system still provide the road map for Vision 20:20? Will the development process under the Vision be egalitarian?


These are the problem statement of this study which is structured into Six Sections. The First section deals with Data and Methods; while the Second provides historical data on Nigerian Economic Structure between 1960 and 1986 (up to SAP era), including ideology and development. The Third Section deals with exploring the dynamics, processes of Nigeria’s development on the path to Vision 20: 2020. Section Four deals with Evaluation of Qualitative Variables and Findings; Section Five deals with Action Plan for Vision 20: 2020 and Global Competitiveness, ending with Section Six which draws Conclusion on the study.


^ I. Data and Methods

The approach to the study is that of analyzing official documents with a conceptual framework of ideology which encapsulates economic, social and political philosophy of development, based on the ground that all meaningful national developments are historically propelled by ideology. Both this and other categories of documentary data, in this study surveyed the Nigerian economy and examine previous efforts at development. Other categories of data are derived from primary sources, where in-depth interviews are conducted on some officials in Yar’Adua administration, particularly on randomly selected members of the 405 Steering Committee set up and inaugurated by the President of Nigeria, Alhaji Umaru Musa Yar’Adua on Monday February 16, 2009. Explaining the details about the operations of the Panel, the Minister of National Planning Dr. Shamsudeen Usman said:


The Panel would be divided into several working groups, with 57 thematic areas. We have 235 members of the business support groups …” (Usman: 2009).


The primary data responses were analysed on simple percentile averages, while secondary data surveyed the lessons of experience in the 49 years since independence in 1960. These development efforts put in Tabular analysis cover five critical phases in the evolution and processes of Nigerian development, up to the introduction of the deregulation of the economy called Structural Adjustment Programme (SAP) in July, 1986. These processes are categorized into five phases as follows:


  1. Structure of the Nigerian economy at independence in 1960 to 1969;

  2. Nigerian economy, 1970 – 1979;

  3. The economic outlook in the 1970s and up to SAP in 1986

  4. The structure of production of the Nigerian Economy in the Decade, 1980 – 1989 and the Basic Economic Indicators during the Decade;

  5. Structural Adjustment Programme and Financial Deregulation in 1986.


The above stated processes were examined in detail after the presentation of the definitional framework of ideology which seeks to respond to the rhetoric, “is there an ideology in Nigeria?


^ Conceptual Framework: Ideology and National Development

The New Encyclopaedia Britannica (1981) sees “ideology,” as a social and political philosophy in which practical elements are as prominent as theoretical ones, a system of ideas that aspires both to explain the World and to Change it. As a theory, ideology has five premises, through which it can be explained.


  • It contains an explanatory theory of a more or less comprehensive kind about human experience and the external world;

  • It sets out a programme in a generalized and abstract terms of social ad political organization which translate ideology to a movement;

  • It conceives the realization of this programme as entailing a struggle;

  • Ideology seeks not merely to persuade but to recruit loyal adherents who are committed to the cause.

  • Ideology addresses a whole public within the territorial boundary of a polity and confers special role of leadership on intellectuals, who construct theories and practical application for the movement.


From these premises of explanation, ideology tends to bring a set of people together within or outside a territorial boundary to share common values and develop a programme of development with wide scope and generalized orientation covering social economic and political life. It is all - embracing: it is economic as to who owns the factors of production and the law covering property ownership; in social life and in social structures who gains and who loses in the distribution process, in terms of inequality of income; and political life, which social class monopolizes political powers.


To bind people together under one value system, ideology entails a struggle of a revolutionary type with adherents who have unflinching commitment to the cause shared by all. To this end, the process involved continued recruitment of adherents spearheaded by leaders who are intellectuals as history has recorded in the roles played by Karl Marx in Marxism – Leninism in the socialist ideology. Robert Heilbroner wrote about the architects of ideology in this way:


Marx was bitter, at bay, heavy and disappointed, he was the draftsman of Capitalism–Doom; Keynes loved life and sailed through it, buoyant at ease and consummately successful to become the architect of Capitalism-Viable” (Heilbroner: 1972).


Put together in this way, we will choose to define ideology in its abstract form, as a set of ideas which explains the nature of man and society, propelled towards final goals which a society hopes to achieve and is based on strong emotional appeal among the people. This is a general concept which can be broken down into the two prevailing but declining ideology of capitalism and socialism. For capitalism, it is a social, economic and political system in which investment in, and the ownership of the means of production, its regulation and distribution as well as the exchange of wealth produced therefrom are in the hands of private individuals and private business.


On the other hand, socialism, is also a social, economic and political system whereby, society comes before the individual and where the society through the state controls the wealth of the nation and where private economic activities are severely limited to prevent the concentration of economic and hence, political powers in a few hands.


The question can now be asked, “Is there any ideology in Nigeria? The answer to this question can be found under “Section 16 – Economic objectives,” of the Constitution of the Federal Republic of Nigeria, 1999. In particular, section 16 (c) states:


that the economic system is not operated in such a manger as to permit the concentration of wealth or the means of production and exchange in the hands of a few individuals or of a group…”


This Constitutional provision is quasi-socialism. The operationalization of this section is provided for in section 16 (3) (a) (e) as follows:

^ A body shall be set up by an Act of the National Assembly which shall have power –

  1. To review, from time to time, the ownership and control of business enterprises operating in Nigeria and make recommendations to the President on some; and

  2. To administer any law for the regulation of the ownership and control of such enterprises.”


While another section of the economy explicitly defines what “major sectors of the economy” means for public policy regulation. This section of the 1999 Nigerian Constitution, Section 16 (4) (a) (b) (c) stipulates thus:


“(a) the reference to the “Major Sector of the economy” shall be construed as a reference to such economic activities as may, from time to time, be declared by a resolution of each House of the National Assembly to be managed and operated exclusively by the Government of the Federation on the date immediately preceding the day when this Section comes into force, whether directly or through the agencies of a Statutory or other Corporation or Company shall be deemed to be major sectors of the economy;”

“(b) Economic activities,” include activities directly concerned with the production, distribution and exchange of wealth or of goods and services;”

“(c) Participate,” includes the rendering of services and supplying of goods.” (The Constitution of the Federal Republic of Nigeria, 1999: 1999)


^ Nigeria, a Mixed Economy Ideology Concept

From the forgoing lavishly quoted Section 16 of the Constitution of the Federal Republic of Nigeria 1999, it is crystal clear that Nigeria had an ideology. The ideology is neither wholly “capitalism,” nor wholly “socialism”. It is a mixture of both ideologies, and it is indeed a “Mixed Economy Ideology” from the Constitution’s definition. The following facts are to be noted:


  1. The Obasanjo Administration, 1999 – 2007, which administration covers the major period since the inception of the 1999 Constitution in which this provision for mixed economy ideology was introduced failed to implement the provision.

  2. A Mixed economy ideology is the coexistence of a private sector and a public sector, even if the public sector is inefficient, it needed only to be strengthened in the light of the Constitution which surpasses all other Laws

  3. But, instead, the public sector was dismantled through a wholesale privatization following the dictate of the imperial powers – the United States and Britain and their agencies - World Bank, IMF, IDA and DFID, and General Olusegun Obasanjo was a cheap instrument in the hands of the imperialists.

  4. A market economy model prescribed for Nigeria by the imperial powers as a solution to Nigerian economic problems was not a solution for theirs, during the Great Depression of 1929, who then adopted the Keynesian interventionist model that replaced their market economy model and brought about their State - owned (public sector dominance) Enterprises (SOEs). Their economic condition in 1929 was not worse-off than Nigerian economic condition when they “forcibly” push Nigeria for Structural Adjustment Programme (SAP) which swept away the role of public enterprises for the so-called ‘market-driven economy.’

  5. Obasanjo Administration (1999 – 2007) pushed Nigerian economy unconstitutionally, to the stand-point of pure and naked capitalism where immorality in public office and looting of Public Treasuries by public officeholders and politicians; and crime became the order of the day. Privatization and other economic deregulation widened the gap between relatively few rich and the masses of the people. There could not have been wholesale privatization or deregulation if Section 16 of the Nigerian Constitution of 1999, which prescribes Mixed-Economy ideology, was sacrosanct. It ought to have remained sacrosanct until that part of the Constitution was duly amended as it is superior to any statute in Nigeria, being itself a fundamental law. But this was not so, until the apostle of privatization (General (President) Olusegun Obasanjo) vacated office on May 29, 2007, after failing woefully to obtain for himself a Third-Term in office, again contrary to the provision of the 1999 Constitution. Obasanjo was an unconstitutional man with an unconstitutional political behaviour.


The Nigerian privatisation policy under Obasanjo administration negated Section 16 of the Constitution and gives no place for the poor. In condemning the anti-poor stance of the policy, the Catholic Archbishop of Lagos, Anthony Cardinal Olubumi Okojie urged President Umaru Musa Yar’Adua to review the privatization policy of out-gone President Obasanjo because the policy unleashed a lot of injustice on the citizens… “It was clearly unjust and programmed to enrich a particular set of people in the country. It was done in a very bad taste to make the rich richer and the poor, poorer. How do they explain the sales of the Port Harcourt and Kaduna Refineries and the National Theatre?” (Okojie, 2007).


^ II. A Survey of Nigerian Economic Structure, 1960 – 1986

It has become necessary to give an overview of the structure of Nigerian economy from its origin at independence in 1960 and up to the ‘80s so as to assess the pillars upon which the vision 20: 2020 rests.


^ I. The Nigerian Economy, 1960 – 1969

At independence in 1960, Nigeria was largely an agricultural country producing food for own consumption and cash crops such as cocoa, groundnuts, rubber and palm oil for export. Towards the end of the decade, crude oil, first discovered in Oloibirin in 1958, in present day, Bayelsa State, was being produced in commercial quantity and exported. This brought about a sizeable reduction in Agricultural share of the GDP. With a share of some 64 percent in 1969; while industrial sector share in output was 7.7 percent in 1960. Towards the end of the decade by 1969, industry accounted for 15.6 percent, out of which the manufacturing sub-sector took a share of 6.4 percent. On its part, services accounted for 28.47 percent of GDP. At that time Nigeria was largely rural with only 14 percent of the population living in urban areas while the rest were rural dwellers (Iyoha, et al: 2003). The Table 1, below gives a full account of the sectoral share during the decade, 1960 – 1969

TABLE 1: Nigeria’s Sectoral Shares in Output (%), 1960 – 69

Year

Sectors

Agriculture

Industry

Manufacturing

Services

1960

63.85

7.78

3.81

28.47

1961

61.83

8.29

4.10

29.88

1962

61.92

8.76

4.41

29.32

1963

61.20

9.03

4.66

29.73

1964

57.88

9.67

4.69

32.45

1965

54.90

12.47

5.43

32.64

1966

54.94

12.32

5.38

32.74

1967

55.40

11.78

5.50

32.81

1968

51.65

10.79

5.65

37.56

1969

49.49

15.56

6.35

34.95

Average

1960 – 1969

57.31

10.64

5.00

32.06

Source: World Bank 1999. World Development Indicators, 1999 Washington DC, World Bank.


ii. Nigerian Economy, 1970 – 1979

The mining sector’s contribution to GDP which was insignificant in the 1960s shot up in 1973/74 when crude oil prices increased from US$4 to about US$14 per barrel. From contributing 1.1 percent to GDP in 1960, oil now contributes 30 percent as against 26.5 percent contributed by Agriculture (UNDP Nigeria: 1996, p. 12). The relative importance of crude oil to the economy was favoured by many factors including increase in output and its exportation, including Nigeria’s membership in the Organization of Petroleum Exporting Countries (OPEC), and the quadrupling of oil prices consequent upon the Arab-Israel War in late 1973. During this decade, the contribution of the industrial sector to GDP rose from 13.76 percent in 1970 to 37.8 percent in 1979, while that of manufacturing rose from 3.67 percent to 8.79 percent. As shown in Table 2 below, the relative contribution of manufacturing production to total output averaged 4.8 percent while the relative share of industrial output in total GDP averaged 27.5 percent. With the rise in the relative importance of oil in the economy, there was a relative neglect of agriculture. The “Dutch Disease” has begun consequently; which by definition means euphoria of false prosperity with a pauperization of the economy and the mass of the people by which agricultural production declined for the Oil Sector. Thus, the relative contribution of agriculture to GDP fell steadily from 41.3 percent in 1970 to 28.7 percent in 1979. For the decade of 1970s, the relative share contribution of agriculture in total output averaged 33.6 percent. With the oil boom of the 1970s, the services sector’s share kept on the increase averaged 38.9 percent. Table 2 hereunder presents the scenario. But what is clear however, is the fact that the long awaited structural transformation of the Nigerian economy from all these analysis was yet to materialize. The country’s colonial economic legacy has remained more or less intact. It was still a primary producing, mono-cultural economy, even if oil has replaced agricultural commodities as the dominant contributor to total national output and public revenue. And in spite of all the emphasis on industrialization, the country was yet to pass the pre-industrial phase. It was still an importer of materials, equipment and even spare-parts. At the same time, there is under utilization of installed capacity.


The cumulative effect of all this, is that Nigeria whose level of industrialization of this time, compared favourably with those of the newly industrializing countries of East and South-East Asia and Latin America in the 1970s has been left behind by these countries.


TABLE 2: Nigeria’s Sectoral Shares in GDP (%), 1970 – 1979

Year

Sectors

Agriculture

Industry

Manufacturing

Services

1970

41.28

13.76

3.67

44.95

1971

40.04

17.34

3.38

42.61

1972

38.27

19.94

3.90

41.79

1973

35.14

25.09

4.04

39.78

1974

31.83

35.24

3.33

32.93

1975

31.73

28.50

5.03

39.77

1976

29.12

32.27

5.06

38.60

1977

29.57

31.42

4.57

39.01

1978

30.48

33.33

6.53

36.18

1979

28.65

37.82

8.79

33.52

Average

1960 – 1969

57.31

10.64

5.00

32.06

Source: World Bank 1999. World Development Indicators, 1999, Washington DC.





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