Nigeria’s perennial recession; a result of policy somersault.

Nigeria will predictably be in recession for a long time. When you keep doing the same thing and expect different results, you will need to check yourself. It appears we are not in a hurry to live in the reality of the 21st century with others.

I sometimes wonder why we like to put the cart before the horse as a country. There  has never been a time when we did anything that was not opposite of what everyone else was doing. Fundamental economics teaches that before you stop importation, you need to have put in place import substitution strategy, and get them working properly before attempting any grandstanding.

Then again, timing is very important in making policy decisions. You cannot wake up from the wrong side of the bed and declare things banned. It is as insensitive as it is unconstructive.  People have often questioned the reasons for some government policies in Nigeria.

What is more heart breaking is where some ‘supporters’ get the kind of shameless illiteracy with which they defend retrogressive policies. Let us start with the Covid-19 decisions of the government.  As the pandemic was biting hard, incomes were shrinking. That was when we suddenly woke up to ban in a commando style,  a whopping 41 imported items, among which were foodstuff and other consumer goods critical to every day survival.

That is not all o. The people were losing jobs in droves. That means that purchasing power was falling rapidly and the country trapped itself in stagflation. Prices were skyrocketing and there was no purchasing power in the hands of the people. To my surprise, some people who I thought ‘know book’ were  just falling my hands in the halleluyah praise singing in honour of the courage with which the government was ‘tackling’ the economy. We would argue it until I had a headache. At some point I couldn’t tell if it was the argument that caused the headaches or the useless virus that trapped all of us in our homes.

Puerile arguments were advanced in support of the government. I took a look at my then none months old baby and asked her if at that age she could disgrace her father by saying such a meaningless thing. One of the headless statements was that China closed their borders and started agriculture. And boom! They became greater, the China you know today. I was torn between laughter and sorrow. 

The story that they did not verify is that China’s maximum ruler, chairman Mao Zedong, threaded the communist path. He closed the boarders and decided on a pilot execution of certain apocryphal economic policies. He closed the Chinese borders to neighbouring countries. And then starvation set in.

Chairman Mao’s decision led to one of the most catastrophic man made starvation in human history which left between 15 to 55 million people dead, and hundreds of people malnourished. That happened between 1959 and 1961. Zedong had no choice but to immediately take steps to reverse the policy.

But ridiculously, that policy was what Zedong called the Great Leap. By 1962, China having seen nwe, reversed themselves and opened their borders. They started an industrialization policy that embraced the domestication of technology. They started to produce for export.

It is the same as Nigeria’s great leap that happened in the midst of a world wide devastation. But wait, who exactly did Nigerians offend that is so unforgiving? Nigeria wanted to leap. Two things happened. She leaped in the darkness of a pandemic with its eyes wide shut! Where did we land? In a circle of inflationary pressures.

First, we ought to have had a solid import substitution plan before talking of shutting down importation. We do not have mechanised agriculture. We want to produce rice for a population of 200 million people with hoes and cutlasses on an unyielding soil. We have no reservoirs where we store excess grains for time of scarcity. What am I even saying, we do not even have enough. Where are we getting the excess from? We might as well be wasting money building silos.

Even the ones planted are being eaten by the holy cows. Private investors in agriculture have had their farms vandalised by cattle which roam across the country. The famine loving government has encouraged the increased devastation of the farms by failing to call the vandals and bandits to order.

People have abandoned the farms and run away to join the army of the hungry parading the streets in the cities to hustle for the little that’s available. That’s a double whammy. No money and the prices of food are high.

The north east and north west of Nigeria used to be the producer of grains and spices. But not anymore. Boko Haram has killed and maim many a farmer, destroyed promising Micro, Small and Medium Scale businesses like sales of rice, onions, fish etc that accompany farming. They have turned large swaths of thriving villages and towns into desolate, uninhabited lands. The best you get in such places in Borno, Yobe and environs are Internally Displaced People’s camps. Even when those at the camps Internally Displaced People’s camps. Even when those at the camps attempt to do little fishing here and farming there, they are traced to the camps and killed. The survivors have become dependent on the lean resources instead of the contributors that they used to be.

On all fronts, Nigeria is scoring abysmally low. In the midst of the confusion called policy, the youths decided to make themselves happy by trading in cryptocurrencies.  The government, like the proverbial village people, followed them there and blocked the channel.

Foreign exchange from that sector has been blocked. This is while the entire world is running towards digital currencies o. Big companies have started accepting Bitcoin as payment for their products, the risks not withstanding. Tesla is a major example. Nigeria nko? They banned it. This is digital currency. Then we have a Digital Economy ministry which knows next to nothing about how to rein in the volatility of digital currency. And some bishops, youths etc had the effrontery to carry placards under the hot Abuja sun to assault our collective intelligence that Pantami is doing well as the head of that ministry.

Nigeria will continue in this damnable trajectory unless things change from the anachronism it has adopted as a state policy to what the world has embraced. The worldview of the government is annoyingly too narrow.

May  Nigeria quickly realise that like the ostrich, it is burying its head in the sand while the entire body is outside. Very soon we will be forced to look inwards. The increase in prices are eroding profits and people are getting thrown out of jobs. The current unemployment rate in Nigeria is 33%. Nigeria is among the first three most terrorised country in the world. Nigeria took over from India as the poverty capital of the world in 2019, according to the Austria based World Poverty Clock and The World Bank in separate reports, with 1 person sliding into abject poverty every six minutes.

To be continued.

Alex Agbo is a writer and an economic researcher based in Lagos.

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