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FinalCall.com News
World News
Nigeria’s mixed bag: Economic potential and security problems
By Jehron Muhammad
Updated May 19, 2014 - 12:28:04 PM
A couple months ago, there were reports that under Nigeria’s lead ECOWAS (Economic Community of West African States) surprised the European Union by not endorsing an Economic Partnership Agreement.
The agreement would have opened the region to more trade. Olusegun Aganga, Nigeria’s trade minister, argued that West Africa was not yet ready for such competition.
Aganga told CNBC-Africa, “It was important that we do not create a situation where Nigeria and other economies of ECOWAS would become and remain import-dependent.”
Aganga’s is an old argument that has to do with the exploitation of Africa’s natural resources. Without first industrializing, he argues, the continent runs the risk of becoming forever “stuck in a quasi-colonial cycle of exporting raw materials and importing finished goods.”
The World Economic Forum opened May 7 in Abuja, Nigeria. According to its website, the “WEF-Africa is both an African and global event, which attracts significant interest and attention from business people and politicians all over the world.”
Despite security concerns stemming from two recent bombings in Abuja and the kidnapping of nearly 300 school age girls by Boko Haram, no fewer than 1,000 delegates and 13 heads of state were scheduled to attend the forum.
Among those in Nigeria to attend the forum was Chinese Premier Li Keqiang. According to Chinese news service Xinhua, Keqiang’s visit was expected to “boost cooperation between the largest economy in Africa” and the “biggest developing country in the world.”
“If people want to take a look at a dynamic, high-potential place in Africa, Nigeria is that place, but it also has a whole lot of issues that are not going away anytime soon,” said Mark Shroeder of the Sub-Saharan Africa business and security consultant firm STATFOR.
The forum will focus “on the rising continent’s problems, as well as its undoubted potential,” said Reuters news service.
Bolo Ahmed Tinubu, former governor of Lagos State and a national leader of the opposition party All Progressives Congress, said he has put “partisan bickering” on hold to focus on challenges facing the country.
The challenges Tinubu spoke of included questions about whether an outside force was at the root of recent bombings in Abuja alongside a growing sense of insecurity that is sweeping the nation.
This year’s forum included a session on security threats, which blemished Sub-Saharan Africa’s “economic promise as it snaps at the heels of Asia as the world’s second fastest-growing region,” said Reuters.
While anti-Western group Boko Haram’s incessant terror tactics and the Jonathan administration’s inability to gain the upper hand are polarizing the country, Nigeria’s new economic status has polarized economists. BusinessDayOnline.com said, Nigeria estimate of its GDP to $509.9 billion for 2013 overtook South Africa’s $372 billion. Yet the “World Bank declared Nigeria as a very poor country with a significant portion of its vast population living on less than $1.25 a day,” BusinessDayOnline.com said.
In underestimating its national output, Nigeria planned its “economy with inaccurate data” that didn’t reflect its national investments and expenditure needs, Business Day continued.
“The rebased GDP figures have shown that Nigeria’s economy is much more diversified than previously thought. … (T)he revised GDP for 2013 grew by 89.2 percent. Agriculture’s previous share of the GDP reduced from about 33 percent to 21.97 percent. Oil and gas sector reduced in its share of the GDP by more than half to about 15.9 percent while the services sector, covering information and communications, entertainment and arts, real estate, financial services, education and health services, etc., has expanded significantly from 26 percent of GDP to over 51 percent. This, in the opinion of The Economist, reveals ‘that Nigeria is much more than just an oil enclave,’ ” Business Day reported.
Where is the U.S. in this picture? Not playing a major role at the economic forum, America is providing assistance in retrieving the kidnapped Nigerian schoolgirls. President Obama had spoken, by phone, twice to President Jonathan pledging U.S. support. “We have been engaged with the Nigerian government in discussions on what we might do to help support their efforts to find and free these young women,” State Department spokeswomen Marie Harf told a daily briefing. “We will continue to have those discussions and help in any way we can.”
Some felt President Jonathan was “bowing to international pressure and outrage” in accepting help to find girls kidnapped by Boko Haram. The Nigerian government also announced creation of an information center to answer questions and provide daily updates about the response to the kidnapping.
Despite Nigeria’s increasing security woes and corruption problems there is hope. With its population of 170 million people and economic power, Nigeria has the potential to lead the continent. That Nigeria sees integration of African economies, infrastructure development and limiting exploitation of African resources as sacrosanct, there is a chance for good leadership.
Jehron Muhammad, who writes from for The Final Call newspaper from Philadelphia, can be reached at [email protected]. You can follow him on Twitter @JehronMuhammad.
