What the Elections Hold For Nigeria: Gloom or Glory (An Economist View)

From the greatest of economic optimism to the highest forecast of gloom, Nigeria is always tossed in between when looked through the knowledge prism of intellectuals around the globe. Global Trend 2025 Report forecast Nigeria to be part of the ‘arc of instability’ due to its youthful age structure and rapidly growing population. This ‘youth bulge’ is expected to remain on rapid growth trajectories and according to this report, unemployment conditions must change ‘dramatically’ to avert instability and state failure. This report holds element of truth, but there is greater optimism. My personal findings working with young people in Nigeria and been a youth myself in my mid-twenties, I have come to understand more fundamentally that the youth, as much as they hold the ability to ruin the nation as seen in the case of Niger Delta militias, they also have the capacity to transform the Nigerian economy. A phenomenon I call the ‘Y-index’ (i.e. youth index). Another intellectual, Okonjo Iweala calls it ‘demographic dividends’. Together with growing technology in the area of telecommunication and the Nigerian Banking reforms (see figure below), the impact the telecoms industry is playing in the banking sector is now so obvious. This provides a bouyant financial sector for core economic activity. Nigeria is on its pathway to growth and that is more so now than ever before. Approaching elections, due in April 2011 (couple of weeks time), is likely to usher in a period of political instability that will probably see a significant increase in political tension. This is the opinion of a school of thought,but on the other hand, we as a nation have become wiser, thus this political tension can be averted or at least minimized in order for Nigeria to attain the required economic growth as a nation. Again, the youth has arole to play in achieving this. Economic expansion will be buoyed by robust performance in the non-oil sector. Real GDP growth is expected to average over 6.5% in 2011-15, provided political tension do not alter these forecasts, Nigeria can be seen to be on its path to economic glory.

Looking Beyond the BRICS: Nigeria, Among the Emerging Emerging Markets 'Frontiers'

Key Data: GDP growth: 5.8%, GDP: $248bn (PPP: $397bn), Inflation: 11.2%, Population: 155.2m, GDP per head: $1,600 (PPP: $2,560).

The biggest concentration of overlooked markets is in Africa (which is in many ways an overlooked continent). In 2011, according to The Economist (2010), there will be a great deal about the unexpected merits of ‘frontier’ economies such as Nigeria who are poorer and riskier than the emerging BRICS (Brazil, Russia, India and China). Multinationals intending to invest in foreign countries will be wise to do so now in order to enjoy location economies while leveraging the valuable skills in Nigeria to increase profitability and profit growth. Based on my recent work, I'll recommend two major non-oil sectors for profitable investment: Agricultural sector and the film industry (Nollywood).
Although with very high volatility, moving into Nigeria can provide a foreign company the needed vitality. Companies that move first will enjoy lots of advantages. They will be able to forge deals with aggressive young companies, strike infrastructure deals with local governments. And they can shape the tastes of future consumers. Companies that succeed in these neglected emerging markets are not only putting down roots in the world’s most fertile soil. They are giving themselves a chance to establish business habits (learning experiences/curves) for years to come. Many reforms are on-going in Nigeria and many is still to come. After all, there are hardly easy markets.

Seun Oyeniran


Reference
The Economist (2010), Businesses will learn to look beyond the BRICs, Nov 22nd 2010 | from The World In 2011 print edition (http://www.economist.com/node/17493411?story_id=17493411)
Hill, C.W.L., (2011), International Business: Competing in the Global Market Place, New York: Mc Graw-Hill
Global Trends 2025, (November 2008), A Transformed World,
UNCTAD Report, http://unctadstat.unctad.org/TableViewer/tableView.aspx?ReportId=719
CORRUPTION PERCEPTIONS INDEX 2010 , accessed 3/3/2011
Human Development Report 2010, The Real Wealth of Nations:Pathways to Human Development, UNDP 2010, accessed 3/3/2011
United Nations (2004), Conference on Trade and Development , Eleventh session São Paulo, 13–18 June 2004, GE.04-51545
Sloman, J. , and Wright, A., (2009), Economics, England: Pearson
Saugato Datta, (2011) (Eds), Economics: Making Sense of the Modern Economy, London: Profile Books

The ‘Baby Boom’ Generation: A Critical Specimen for Economic Liberation

A study* which was led by the Harvard School of Public Health and compiled by an independent task force convened by the British Council as part of its work to provide for young people around the world made an important discovery which may sound not too much of a deep revelation for a number of us who have closely studied the Nigerian polity and have made independent surveys and analysis. This is the linchpin of the report and which will serve has a spring board for my writing:
Nigeria stands on the threshold of what could be the greatest transformation in its history – with population growth and its ‘baby boom’ generation entering the workforce. By 2030, it will be one of the few countries in the world with young workers in plentiful supply.
According to the report, the average Nigerian could be 3 times richer by 2030 – and over 30 million people will be free from poverty.
While the UK government seems to be very keen on the positive side of this report they, the report itself was strong to emphasize the possible downside. The risks are as great as the opportunities: If Nigeria fails to plan for its next generation, it faces ethnic and religious conflict and radicalization, as a result of growing numbers of young people frustrated by a lack of jobs and opportunities. Nigeria needs to create 25million jobs over the next ten years – and move its focus away from oil, which contributes 40% to national GDP, but only employs a small percentage (about 10%).
This goes directly along with the ‘Y’-Index theory** explained in previous editions of ‘On The Road To 50’. Nations all over the world who have demographic advantages build their economy round it and make the greatest profit from it. For example some countries in Europe which have a higher percentage of its labour force being aged are implementing policies to further extend their retirement age. More recently, my Chinese friend that I met here in the UK told me about a policy that favoured women wherein men are responsible for majority of the work in the community including cooking of the food which is more or less a woman’s job in our contemporary Nigerian setting. Of course, it’s important to mention also that the economy of countries like India is labour deepening.
As we celebrate our golden jubilee anniversary in Nigeria, we need to draw the attention of our policy makers at various levels and, their specific and unspecific stakeholders at various capacity of the need to harness the various talents and potentialities in the Nigerian youth. This is yet another clarion call.
We have found ourselves on a crossroad as a nation and we need to make and implement these critical policies at this dire time. Failure to do so in due time will lead to a precarious situation characterized by crime and criminal activities carried out by young people who cannot be absorbed into the system for useful economic gain. This is already the situation at present and is bound to exacerbate if nothing is done about it urgently. David Bloom, Professor of Economics and Demography at the Harvard School of Public Health, who chaired the task force, said:
crossroads: one path offers a huge demographic dividend, with tremendous opportunity for widespread economic and human progress, while other path leaves Nigeria descending into quicksand. Nigeria’s most important asset is its young people – more important than oil.
Proven: young adults are powerful agents of beneficial change, especially if they are healthy and educated, with decent jobs.

*The report has been compiled by an independent Task Force – and the British Council does not necessarily agree with or endorse all views expressed.
. Previous Next Generation reports from the British Council are available online:
Pakistan: http://www.britishcouncil.org/pakistan-next-generation-report-download.htm
Bangladesh: http://issuu.com/nextgeneration/docs/next_generation_report
**Y-Index Theory was coined by Seun Oyeniran. It emphasizes the criticality of youth involvements in economic activities and based it upon an index factor that can be measured in weighted averages.
-Seun Oyeniran (27/9/2010)

Nigeria: On The Road To 50 #1

#1. The Y-Index* proposition lays major emphacy on the involvement of the youth in the policy framework of the Nigerian economy. This emphacy is predicated upon the fact that Nigeria's population of about 152million people is about the largest in Africa and containing the highest amount of youth in the region. And the onus stems from the logically true proposition that youths are stronger physically and psychologically and are thus fit to handle greater and mentally demanding responsibilities than their older counterparts.
As we march towards our 50th year of independence and faced with several challenges including nurturing the vision 20/2020, we must appreciate our demorgraphic dividends. On top of that, key stakeholders and policy makers should appreciate the the Y-index factor and make it a springboard upon which key decisions can be made to emancipate Nigeria from all anticipated economic lethargy.
The youths must be recognised and absorbed wholly in order to enact the changes that we expect to see in the new Nigeria.

Seun Oyeniran.

*Y-Index Theory was coined by Seun Oyeniran. It emphasizes the criticality of youth involvements in economic activities and based it upon an index factor that can be measured in weighted averages.