Presidential leadership in a Nigeria without oil

When the International Monetary Fund (IMF) categorized resource-rich countries, it classified the countries according to their baskets of exports. At least 20 African countries, including Nigeria, Angola, Ghana and Tanzania, were classified as resource-rich, with a bulk of raw crude oil, minerals and agricultural commodities as export bases. Classification of countries in other continents such as Japan, Malaysia and Indonesia is based on the diversity of their export base and value added products. Since 1973, the year of the first oil boom, crude oil has accounted for more than 90 percent of Nigeria’s export earnings, making Nigeria a classic example of a monocultural economy worldwide. While a monocultural economy has the advantage of product specialization, it goes against the spirit of Article 16 of the 1999 Constitution (as amended) in building a balanced economy that is resilient.

Within the context of the ideals and objectives of the 1999 Constitution (as amended), the state has a responsibility to “use the resources of the nation and promote national prosperity and an efficient, dynamic and self-sufficient economy… and to implement its policies aim at ensuring – the promotion of planned and balanced economic development”, as stipulated in Article 16 of the Constitution. To achieve this economic goal of the State, the National Economic Council, established by the provisions of Section 153(1) and paragraphs 18 and 19 of Part I of the Third Schedule, chaired by the Vice President and composed of the 36 state governors, the governor of the Central Bank and other co-opted government officials, is mandated to “advise the president on the economic affairs of the Federation, and in particular on measures necessary for the coordination of economic planning efforts or the economic program of the various governments of the Federation.”

Despite the fact that the President sits at the top of Nigeria’s leadership hierarchy with enormous and broad responsibility to influence national economic policies and prospects, the next President must provide coordinated and collaborative leadership in accordance with the constitutional requirement that the three levels of government in Nigeria should identify, leverage and coordinate economic policies that leverage their comparative economic advantages, by producing at least one quality good or service per state, at a lower opportunity cost than other states, regions or countries.

To transition and transform Nigeria’s economy from oil, subsistence agriculture and informal activities as the main drivers of the economy to production-based industrialization, the President must purposefully pursue power transfer to ensure that sub-national governments on the necessary energy base load for industrialization – the ability and capacity to generate and transfer electricity to industries within their states; revitalize our steel sector; investing heavily in education, entrepreneurship and technology skills; and, most importantly, create a favorable business environment for industries to thrive, through efficient institutional implementation of the ease of doing business in Nigeria.

In addition, the question is whether a world without oil is possible. The changing global economic environment suggests such a possibility, although not as easy as it might seem, given that oil can be used multifunctionally – from fuel to petrochemicals, which form the material basis for such products as tech gadgets, plastics, cables, creams and other products. With the global green revolution based on the proposal that economic growth no longer requires higher carbon emissions, Nigeria needs a firm president who understands that with 206 trillion cubic feet of natural gas reserves, Nigeria needs climate justice and a fair energy transition that enables gas as our transition fuel, in our process of contributing to the global climate solution.

With changing geopolitical landscapes, it is in Nigeria’s interest to achieve a diversified economy that shifts away from dirtier fuels such as diesel, kerosene and petrol. At the height of the 2020 Covid-19 global pandemic, Nigeria was saddled with unwanted shipments of crude oil and liquefied natural gas (LNG), oil prices fell to an all-time low, trading at minus $37.63. Although Nigeria’s Bonny Light crude was trading at $12, our biggest buyers were unable to buy due to the effect of the coronavirus. As countries opened up their cities, it was easier for most diversified economies to recover from the impact of Covid-19 than for monocultural economies that rely primarily on oil.

Nigeria must now move beyond political platitudes to creatively explore our comparative economic advantages, leveraging our more than 45 mineral resources such as lithium, which will account for 94 percent of global tech batteries currently valued over the next decade at $78,000 a ton; a leather industry expected to generate more than $1 billion in export earnings by 2025 if properly leveraged; a rice industry that can feed Nigeria and many countries of the world, among others.

The end goal of a no-oil Nigeria is an economy with a stable distribution and redistribution of national wealth, managed in a way that does not allow the concentration of wealth or means of production and exchange in the hands of a few individuals or a group; which ensures that Nigeria’s material resources are best utilized and distributed to serve the common good; locate industrial clusters across the country, defining the productivity identity of each region in Nigeria; and an economy that is diversified, sustainable and stable enough for the well-being of the people. For the survival of our economy we need a presidential leadership to take responsibility and run Nigeria as if there was no oil, to fully implement our local content laws, to end oil theft to strengthen our revenue base improve, to prudently reinvest oil proceeds in other productive sectors of the economy, and adequately curb corruption within the economic environment. God bless the Federal Republic of Nigeria.

• Ekpa registers at ekpastanleyekpa@gmail.com

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