…many people who run economies in sub-Saharan Africa simply hinge their projections and thinking on what the World Bank or IMF or some other global bodies say… We can grow at double digit. Indeed we should be growing at double digits! And we shall grow at double digits if we had a thinking, independent, quick-minded government…
Let us first examine where this economy should be presently. In answering the question we need to situate the economy properly in the trajectory of the development of economies. I would wager that we are a toddler economy, not only because we only started managing our own economy hands-on a mere 58 years ago, but also because this system of economic management is largely alien to us – it was imposed and there’s nothing we could/can do about it. Everything here is new to us. We had to strap ourselves up and get used to a new global economy that emphasised exports and import, interest-earning banks, technology, competition, capital accumulation, globalisation and everything in between, just like every other colonised country around the world. Everybody was basically jackbooted to wake up and smell the coffee.
The ancient history is that the cowrie/manilla economy, trade-by-barter, or even trade with raw gold as medium of exchange had to disappear and we had to get used to fiat money. Our traditional economies – just as the economies of others in our category – were manipulated by those who are much smarter than us. We were even taken advantage of, because many resources were taken from here (for free or next to nothing) and sold in global markets which, even though were then developing, was far more sophisticated than what we had. But on the flipside, this new economy offers a totally new vista compared to what we may have been used to. The problem is that we are still dizzy from the rapid changes and most of our leaders have not been able to properly define where we lie, where we belong, what our innate and real capacities are. Perhaps in some cases they know, but are somehow incapacitated. But today, we are playing a globalisation game in which we had/have relatively no competence and training, in comparison to the masters of the game. By and large, ours is a toddler economy.
But what toddlers do, is grow. So, the underdevelopment of an economy is itself an opportunity for growth. It is therefore frightening that an economy like the United States is growing at 4 per cent, with less than 1 per cent annual population growth to match, and a toddler economy like Nigeria can only manage 1.5 per cent growth in GDP for the last quarter (Q2 ,2018). In fact we are told to be happy to have barely exited an unwarranted, unnecessary and recklessly-foisted deep recession; a total unforced error if you ask me. Then there are those who say double-digit GDP growth year-on-year is impossible, perhaps because no economy has reported such in recent times. I take strength from the words of George Bernard Shaw: “Some see things that exist and ask why. I imagine things that don’t exist and ask why not?” I think it’s a total paradigmatic shift that we need in our society and economy, no less. Einstein said, “Education is what remains after you have forgotten what you were taught in school”. I say we shouldn’t play from rules written in some expired textbooks. Our economists, just as our engineers, should think deeply and fashion out ideas that never existed but which can shock our system into massive action. That no one has achieved a feat before is the very reason we must aspire to achieve such feat. We should position Nigeria for greatness, not revel in overall mediocrity.
The failure to think of new possibilities and believe in the embedded great potentials of our economy also stems from the miseducation of the Nigerian – or indeed most colonised peoples. We were taught to obtain certificates but never to be original. In fact the farther you go in conventional education in these parts, the more your inadequacy complex is likely to rise. People bandy PhDs which are only good enough to show why some long-dead theoretician said you cannot think in a certain way or the other.
If I use the same analogy of the stage of growth of an economy, India would probably be a teenager of a country – great potentials, effervescent, but not quite matured. To that extent, India is showing the required growth for its stage of development. Yet as fast as a teenager will grow, she cannot grow faster than a toddler.
The Indian Experience
I recently gave a brief about my ideas to a group of gentlemen recently. A PhD holder in Economics challenged my assertion that India is the fastest growing economy in the world in the past few years. This caused me to go back and do the research. And I was right. Indeed the Indian economy is growing so rapidly for a population of 1.3 billion people, that countries like Nigeria ought to be very embarrassed and ashamed. I now see that corruption is not our main problem but deliberate mediocrity. I believe that one of the unstated or underestimated catalysts of the ongoing Indian economic revolution is the ‘Swaach Barat’ – Clean India – programme that has revolutionised many rural areas in what Bill Gates called, “The largest behavioural change programme in modern history’. When I researched how fast the Indian economy was growing, I came across headlines from reputable organisations such as the World Economic Forum, such as “India’s Remarkable and Robust Growth Story”, “India Reclaims ‘World’s Fastest Growing Economy’ Tag from China”, “World Bank forecasts 7% Growth Rate for India for 2018-19” and so on. I was overawed.
If I use the same analogy of the stage of growth of an economy, India would probably be a teenager of a country – great potentials, effervescent, but not quite matured. To that extent, India is showing the required growth for its stage of development. Yet as fast as a teenager will grow, she cannot grow faster than a toddler. So I believe this justifies my analogy.
But why do global economic agencies usually predict circa 2 per cent annual growth for the subregion. That is the equivalent of stating categorically that ‘you guys are not thinking and we don’t believe you will be able to think in the next 5 years at least’. Or worse, that we are not dreaming and are incapable of doing so. To make matters worse, many people who run economies in sub-Saharan Africa simply hinge their projections and thinking on what the World Bank or IMF or some other global bodies say. I am here standing today, to say, out with the old, in with the new! We can grow at double digit. Indeed we should be growing at double digits! And we shall grow at double digits if we had a thinking, independent, quick-minded government such as I intend to offer Nigeria.
The Indian economy is properly diversified – spatially and across many products. Go figure. I believe we should set a 20 per cent growth target if we were serious, and see how far we can go. Like they say, those who aim for the moon, sometimes find themselves among the stars.
Let me close by quoting extensively some of the narrative on the Indian economy presently so that readers can pick up some serious learning points. Please compare this with the sad projections for the Nigerian economy:
“The World Bank on Wednesday said while India’s GDP growth rate will return to 7.5% in two years’ time, to sustain an 8% GDP growth rate, India requires a decisive structural reform momentum that succeeds in stimulating investment and export growth while maintaining macroeconomic stability….The Indian economy regained its momentum in the December quarter, recovering from disruptions caused by demonetisation and implementation of the goods and services tax (GST), to expand at 7.2%, the fastest in five quarters… The World Bank has projected economic growth to accelerate to 7.3% in 2018-19 and 7.5% in 2019-20… However, it said oil price is less of a risk for now, as it expects oil prices to remain range-bound and average $58 per barrel in 2018… There have been six episodes in the last five decades when growth rates exceeded 8%, about once in each decade. The only durable episode of growth sustaining at levels above 8% for five continuous years is the one which lasted from 2004 to 2008, with the average growth rate reaching an unprecedented high of 8.8% a year… The acceleration of growth is evident not just for aggregate GDP, but even more strongly for per capita GDP. The average pace of per capita growth was 5.5 percent a year in the last decade. Interestingly, when compared with some of the world’s largest emerging economies, this steady acceleration of growth stands out as being unique to India… Over the long run, growth has also seen increased productivity – both in labour and total factor productivity. Finally, growth has been broadly resilient to shocks, both domestic and external. The resilience of India’s growth can be attributed to the country’s large and spatially diversified economy, as well as to its diversified production structure that is not dependent on a few products, commodities, or natural resources. It can also be attributed to India’s diversified trade basket and broad range of trading partners, wherein a slowdown in any one part of the world will not result in a large impact on India.”
The learning points here are crystal: 8 per cent growth rate, tax reforms, the targeting and eradication of ‘black money’ through currency re-issuance, the experience of the Indian economy growing at 8 per cent even with oil prices exceeding IMF-predicted $58. But for us, high oil prices has achieved only a dismal 1.5 per cent growth in GDP. The Indian economic growth is consistent and resilient. Per capita GDP in India is particularly on the rise and the growth has led to increased labour and other-factor productivity. The Indian economy is properly diversified – spatially and across many products. Go figure. I believe we should set a 20 per cent growth target if we were serious, and see how far we can go. Like they say, those who aim for the moon, sometimes find themselves among the stars.