Abuja Across Nigeria Editorials Featured Health Main News News Politics Press Releases Reports Special Reports

NIGERIA’s RATING AS GLOBAL POVERTY CAPITAL IS SHAMEFUL

Executive Chairman, CACOL, during march 8,2018 press conference

The recent Brookings rating of Nigeria as the country with the world’s highest population of poor people was not just a confirmation of what many have always feared about the situation in our country in recent times, it is also an attestation of how low we have sunk in the human development index.

The Brookings Institution – a global Poverty Watch group-based in Washington DC, USA – in its latest report titled ‘The start of A New Poverty Narrative’, declared Nigeria as having overtaken India as the country with the highest number of poor people in the world.

The report further declared that about 87m Nigerians or 42.4% of Nigeria’spopulation currently live in extreme poverty as against India’s 73 million. Ironically, while poverty level in India (with a population of over one billion) continues to fall, extreme poverty in Nigeria grows at the rate of six people every minute.

According to the same report, Africa today, accounts for about two-thirds of the world’s extreme poor. And with current trends, they will account for nine-tenth of global poor people by 2030. This is because, 14 out of 18 countries in the world,where the population of the extreme poor is rising, are in Africa.

Shortly, after the Brookings latest Poverty rating, President Buhari’s Special Adviser on Media, Mr. Femi Adeshina, came on air to debunk the document, claiming that the data used must have included only the economic performance of the nation prior to the emergence of Buhari’s government in May, 2015.  On its own part, the Federal Ministry of Budget and National Planning issued a comprehensive statement debunking the rating. In a release signed by the Special Adviser to the Minister on Media, A.K. Panndem James, the ministry stated: “Government believes that the yardstick used by World Poverty Clock does not directly rely on household survey data as national statistical offices in most countries do. Instead, as stated in their methodology, they relied on models to estimate poverty rates across countries using data provided by governments to international agencies.

\

The models make assumptions on expected future changes in income, IMF Medium term growth forecasts, long-term projections and analysis developed by the Organization for Economic Cooperation and Development(OECD), all of which are significantly influenced by uncertainty.   It is in essence, just a model based on a lot of assumptions which cannot substitute for fieldwork involving actual data collated from households in a consistent and representative way.

The ministry further stated: “In the specific case of Nigeria, the Poverty Clock used as baseline the General Household Survey for 2012/2013, which was not designed to measure poverty indicators accurately and followed a methodology that can be misleading if relied upon for poverty estimates. In line with extant laws, the National Bureau of Statistics (NBS) remains the statutory agency of government with responsibility for producing Nigeria’s official statistics including poverty estimates. Like several other countries, Nigeria’s poverty estimates are obtained from the National Living Standard Survey (NLSS) undertaken every five years, and which was last conducted in 2010

“This implies that it is not possible to conclude on Nigeria’s poverty position until the NBS completes the NLSS, as no comprehensive fieldwork has been done in Nigeria, and among Nigerian households, as is required according to standard international methodology. It is however important to point out that the Federal Government of Nigeria, in line with strategies outlined in the Economic Recovery and Growth Plan (ERGP), remains committed to promoting sustainable economic development through various social investment schemes that will yield positive impact on poverty and unemployment and will consequently change the trajectory of poverty in the country.”

Based on the government’s own perspective, the country’s Economic Recovery and Growth Plan is certainly on course.

However, the World Bank has defined extreme poverty as referring to people who live on less than $1.9 or N650 per day. It is agreeable that people living within this category are usually unable to meet their minimal needs for survival. To reduce or arrest this poverty trend, Nigeria needs to have 11.9 people rising above extreme poverty every minute between now and 2030.

Paradoxically, based on available statistics, 6.8 Nigerians are currently falling into extreme poverty every minute.

This notwithstanding, it is CACOL’s view that among the factors that have led Nigeria to its present sorry pass are a rapidly growing population vis-à-vis an economy gripped by stagflation. For instance, between 1990 and 2015, Nigeria’s population increased by 84 percent. This happened without any corresponding increase in the nation’s gross domestic product or GDP.  Whereas countries like India and China – with populations of 1.3b and 1.5b people respectively – have invested heavily in modern agriculture and technology, Nigeria continues to rely on a primitive mode of agriculture that yields very little output.

Another factor was the decline in Nigeria’s oil earnings.Since oil has been the major foreign exchange earner for the Nigerian economy, dwindling prices in the international market affected our economy adversely. This led to an economic recession. Since the nation climbed out of the recession, the economy has been growing very slowly.

It is also indisputable that the unguarded pronouncement and body language of the Presidency at the inception of President Muhammadu Buhari’s administration in 2015 contributed in no small measure to drive the nation’s economy into a recession.

Buhari’s pronouncements on the new administration’s fiscal and monetary policies with different foreign currency exchange rates that persist till this day also generated fears among foreign investors who in a mad rush pulled out about $100b from the Nigerian economy.

This put an unprecedented pressure on the Naira and resulted in a devaluation of about 150%. This development facilitated much of the descent into economic recession, even if the government refuses to admit it.

There is also a consensus that Nigeria’s deeply unfair wealth distribution between the rich and poor also contributed to the present economic situation in the country. An overwhelming proportion of Nigeria’s wealth is concentrated in the hands of a few elite. These include politicians, public office holders, civil servants, political cronies, primitive capitalists and various kinds of rogue millionaires who simply launder much of the country’s wealth abroad thus depriving the domestic economy of the much needed lifeline for growth. This persists largely due to rampant corruption and impunity among political office holders.

This was buttressed by Nigeria’s former Minister of Finance, Dr. Ngozi Okonjo-Iweala. In her book titled, ‘Fighting Corruption Is Dangerous’, she described  in Chapter 4 of the book how those at various levels and arms of government always fight over one single issue- how to Share money. What this means is that in Nigeria, you have a political and ruling class with a propensity of only sharing and expropriating the country’s wealth rather than creating it.

It has also been pointed out that the government’s recurrent expenditure at various levels has also negatively impacted on the economy as what is usually left for capital projects in the budget could barely be enough to execute critical infrastructures.

It is also clear primary factors that lead to poverty like lack of basic education, absence of employment opportunities andenvironmental degradation could be so difficult to overcome.Nevertheless, any determined and responsible government can tackle poverty if it possesses the political will to do so.

It is worth mentioning that for nearly 60 yearsince Nigeria attained independence, various governments have tried to put in place poverty alleviation programmes and policies but these efforts have largely remained inadequate to achieve poverty eradication. An example is the various ‘back to farm’ programmes of successive past administrations that have failed to reviveour country’s agricultural sector.

What is to be done

Firstly, Nigeria needs to embrace a holistic approach to development.This approach should be one that tackles poverty by uplifting individuals and at the same time, developing structures for economic prosperity on ground. For example, in recent times, some nations have become fairly wealthy by concentrating on expansion of small scale industries and investing in technological development. Governments in these countries have also resorted to creating employment opportunities for their citizens through education, training and establishment of reliable micro-finance systems.

·          It is noteworthy that after the SecondWorld War when America and some European countries faced a similar situation, the United States Government provided over $500m bail-out fundsto some of the European countries as part of its Marshall Plan, while President Franklin Roosevelt got the teeming unemployed American youths engaged with a minimum wage.A similar approach should be utilized to get many of our unemployed youths off crime and despondency while the country fully recovers. Our major problem is that a very minute percentage that constitutes our political class controls over 75 percent of the national wealth while less than 25 percent of the nation’s resourcesis left for over 85 percent of the population. This approach can never make Nigeria to come out of its economic quagmire and attendant instability.

·

Many Nigerians are simply not interested in paid employment, either by government or individuals. The country has artisans who have the skill but lack resources to set up productive and sustainable ventures. Giving financial assistance to such people by bringing them together as business partners and with proper monitoring will have a huge impact on the country’s economy. Countries like Turkey, Morocco and Iran are enjoying huge foreign exchange earningsthrough this approach.

·         The Federal Government’s intervention funds could also be made available to budding entrepreneurs to boost the operational capacities of the manufacturing sector and that of small and medium scale enterprises.Accessibility to such funds should be flexible enough to allow those who really need them to have access.  Part of the funds should be used in developing sectors like movies, music, and Information technology, Sports, advertising and farming. Also, the legalization of the activities of hundreds of illegal miners and local oil-refineries being operated by the people will create wealth and employment.

Debo Adeniran

Executive Chairman, CACOL

08037194969

dadnig@yahoo.com

cacolc@yahoo.com

www.deboadeniran.com

About the author

CACOL

Add Comment

Click here to post a comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Subscribe to our Newsletter

Archives

Get an awesome sticky message bar!Download