By Dakuku Peterside
Recently, I was opportune to listen to a presentation titled “Nigeria’s Economic Prospects” by one of Nigeria’s foremost Economists, Dr Ayo Teriba. He articulated Nigeria’s current economic woes and situated them in the global context of Post COVID era, European geopolitical tensions, and the resulting energy and commodity price crises. His overarching arguments and postulations are not only germane for a rethink of Nigeria’s economic trajectory but also a breath of fresh air in the current discussions on restructuring Nigeria’s economy for growth and prosperity.
This essay and a series of others to follow result from the need to rethink our economic structure for productivity, in line with the global trend and current realities and not leave our economy to be decided by happenchance and outdated political economy theories, reminiscent of the industrial revolution era instead of the knowledge economy built more on innovation than on production.
Three of the leading presidential candidates for the 2023 general elections are talking about increasing productivity and export as the critical drivers of economic growth. A review of their economic thinking shows that they all believe Nigeria should engage in more agricultural and manufacturing production for internal consumption, import substitution and export.
They emphasise production and the resultant increase in productivity and employment of human and natural resources as the blueprint for Nigeria’s economic growth. As simplistic and direct as this economic thinking is, the existing economic structure and the ones proposed by the presidential candidates are insufficient to put Nigeria on a growth trajectory.
Nigeria must leapfrog industrialisation and connect with global innovation and financialization trends to succeed. Financialization is eclipsing industrialization. Financialization, according to Thomas Polley of the Levy Economics Institute, refers to a process whereby financial markets and institutions gain greater influence over economic policy and outcomes. Productivity in the post-industrial economy goes beyond income-centric optimization of production transactions for the largest margins from local and foreign sales thawhichre the hallmark of the earlier stages of industrialization. It is now much more about wealth-centric optimization of tangible and intangible asset portfolios for maximum balance sheet values that are the hallmark of financialization.
The world has moved away from the past in which global commodity prices( crude oil inclusive)dictated the pace of growth of items on income statements into a new reality in which global equity prices play the bigger role of dictating the pace of wealth growth on balance sheets. Global wealth has been growing much faster than global income since 2000, and this trend is largely expected to continue in the foreseeable future.
The mixed outlook of the two global asset prices over the next half-decade underpins those expectations. The IMF projects that commodity prices, including crude oil, currently elevated by geopolitical tensions will fall steadily back to 2021 levels from 2023 to 2027, while we expect equity prices to continue the solid upward trajectory in the last decade through 2027.
If the asset prices follow the projected paths, global exports could rise by about 50 per cent from US$22.4 trillion in 2020 to US$33.1 trillion by 2027, while FDI stocks could surge twofold from US$41 trillion in 2020 to US$79 trillion by 2027. Over the medium-term balance sheet gains look set to remain three to four times as large as income statement gains.
It is in this context that it becomes more important for the presidential candidates to say more about what they plan to do about getting a fair share of the growing global pie of global FDI stock into idle public assets in Nigeria that spread across corporate, real estate, and infrastructure.
We now must define productivity to include innovations that optimize asset portfolios in addition to those that optimize output transactions. The transaction model of productivity relies on the quantity and quality of goods and services produced and the revenue generated through internal consumption and export. Global trends now transcend this by embracing asset productivity. Optimizing assets involves unlocking liquidity from publicly owned place-based, space-based, and skill-based assets littered across corporate, real estate, and infrastructure sectors.
So, instead of relying solely on products and income from agriculture, industry, and service, we should go after the place-based, space-based, and skill-based assets that are needed to generate output in these production-based sectors. Government should allow the inflow of FDI into the innovation sectors of the economy that the productive sector relies on to thrive. We see this in Nigeria’s Fintech sector, where small and medium industries attract billions of dollars as FDI. The government should collaborate with the private sector to open other innovation sectors for FDI.
Saudi Arabia exemplifies this trend. The country has historically
focused on creating wealth through income-
centric optimization production and exports, not caring much
about creating wealth through the optimization of asset portfolios. But the weakening of global commodity prices since 2014 in the face of strengthening global equity prices prompted the country to take steps to financialize its public asset portfolio in 2016.
It was in this process that it listed ARAMCO in the market through an initial public offering in 2019. The market value of ARAMCO is more than$2 a trillion now, making it one of the biggest companies in the world. Considering that Saudi Arabia’s GDP is only about US$850 billion now, it is fair to say that Saudi Arabia’s balance sheet now contributes more to its national wealth and net worth than its income statement.
We can also see this with the American technological behemoth, APPLE. It takes direct control of the upstream/conception and downstream/distribution phases of its value chain where its growing stock of tangible and intangible skill-based and space-based assets ( including patents, brands, creative designs, and its closed digital marketing platform ) differentiates its offerings but outsources the midstream assembling/production stages of its devices, where operating procedures are hard to differentiate, to third parties offshore. Apple is worth over $2 trillion.
The next is place-based optimisation. All stakeholders must unlock liquidity by optimising the market value of public spaces, real estate, cities, transit routes, tourist centres, farms, factories, and other physical capital. Government should review its real estate holdings to unlock the liquid value attached to them. It may make sense to commercialise real estate with substantial commercial value due to its location rather than keeping them as government buildings serving a need that counts for less.
For example, the British government moved prisons from inner cities across the UK to more economic locations and repurposed the old sites for redevelopment into luxury residential or commercial real estate as part of their efforts to get the best value from public real estate portfolios.
Dubai is another example. It developed its real estate market, tourism, and business centres to attract people from around the world to visit, work and live in Dubai. Optimization of Dubai’s portfolio of place-based assets contributes more to its wealth and net worth than producing and exporting oil. Unlocking the value in place by Amenitizing leisure and leisure activities is essential.
Optimising spaces also fuels productivity. Companies
obtain ownership rights, patents, licenses,
connectivity, and digital platforms that create significant value for other producers and consumers. Companies like Google, Facebook, Airbnb, and Uber are owners of space-based assets that others who wish to produce, sell, or buy cannot do without. They are multi-trillion-dollar companies in equity value and generate huge revenues from the financialization of their spaced-based assets.
Likewise, optimising skills and knowledge development is an excellent part of productivity. Global skill shortage is fueling an unprecedented wave of talent migration. The Philippines is a leading supplier of seafarers, caregivers, and domestic workers in the world. The culinary skills of the Chinese help to differentiate Chinese restaurants worldwide. We can debate whether diners are paying a premium for the skills or the products.
The need for healthcare workers in developed countries is an opportunity to train and export the skills of Nigerian youths to the rest of the world, so also ICT skills. Investors worldwide highly value skills, brands, trademarks, recipes, talents, innovations, and knowledge.
There is a need for rethinking productivity in Nigeria. The presidential candidates should not only understand the problems of Nigeria and how to solve them, but they should have a sharp vision of the destination they are taking Nigeria to. According to Seneca the Younger, ‘If a man knows not to which port he sails no wind is favourable. The February 1887 Magazine of American History teaches that ‘You cannot make much of a wind, but you can choose a wind, trim your sails to it, and attain the haven you select by its push and inspiration”.
Presidential candidates need to tell us more about how they plan to incentivise innovation to unlock growth in both income and wealth. Innovation is a crucial enabler of productivity. Innovation and productivity drive living standards. The capacity to generate innovations is the defining factor of productivity, not necessarily the goods you produce.
Group Calls For Protection Of Journalists In Bayelsa, Imo, Kogi States
The Media Rights Agenda (MRA) has urged for necessary measures to protect journalists and other media workers during this weekend’s off-cycle elections in Bayelsa, Imo, and Kogi States.
The group sent the request to the federal and state governments, as well as law enforcement and security agencies, stressing that the role of journalists in disseminating information about the electoral process is critical to ensuring free, fair, and transparent elections.
In a statement issued ahead of the elections in Lagos and signed by the Communications Officer, Media Rights Agenda, Idowu Adewale, MRA also urged journalists to be cautious and to use its existing hotline (08138755660) to report any threat or attack they may encounter during the process, as well as any obstacle.
Adewale said in the statement: “Given the pattern of heightened attacks on journalists and the media during previous elections, including the recent 2023 general elections, as well as the tense political climate in the three states in the lead-up to the elections, measures must be taken to ensure general security during the elections and provide adequate protection for journalists covering the elections.”
“Access to information allows citizens and other members of the public to have the information they need about political and electoral processes, facilitating effective public participation in elections,” he says.
“Journalists and the media play an important role in ensuring residents and other members of the public have access to information and may participate in the process.
“As part of efforts to preserve the integrity of the polls, it is also critical that the safety and well-being of these interlocutors be assured and safeguarded.”
Lamenting the increased number of attacks on journalists in the run-up to the off-cycle elections, as well as earlier this year in the run-up to the general elections, he emphasised that “a free and vibrant media is fundamental to a healthy democracy, and journalists must be able to carry out their duties without fear, coercion, or violence.” During this vital phase, MRA stands ready to assist them and assure their safety.”
Police Nab Husband, As Mother Of ‘Mummy Be Calming Down’ Boy Takes Own Life
Men from the Edo State Police Command are said to have detained Mrs. Toluige Olokoobi’s husband after he allegedly murdered her.
Olokoobi was the mother of Oreofeoluwa Lawal-Babalola, the tiny boy whose video went viral in 2020 after he pleaded with his mother, “Mummy be calming down.”
Oreofeoluwa rose to prominence on social media after a video of him crying in an attempt to confidently appeal to his mother, who chastised him, went viral.
The film inspired Lagos State Governor Babajide Sanwo-Olu, who used it to deliver an Eid-el-Kabir appeal to Muslims and Lagos people in general to remain calm during the COVID-19 outbreak.
Following that, the youngster and his family met with the governor, who praised his bravery and poise.
While little has been heard about the family in three years, heartbreaking news broke on social media on Tuesday that the boy’s mother had committed suicide.
According to an X user, Olokoobi committed suicide in Benin, the capital of Edo State, for unknown reasons.
The X user, who stated that he was present at the site on Monday afternoon, went on to say that she had refused to disclose her difficulties with anyone before committing herself.
“The woman in the viral Mummy Calm Down video has just committed suicide here in Benin,” he stated in an email.
“She refused to discuss her problems with anyone.” She abandoned three children for her husband, including the well-known Mummy Calm Down boy.”
Meanwhile, confirming Olokoobi’s death in a chat with BBC Pidgin, the spokesperson of the Edo State police command, Chidi Nwabuzor, said her husband has been arrested and detained for questioning.
Nwabuzor said the husband reported the matter to the police.
The police spokesperson quoted the husband to have said that “he came home from the market when he saw his wife hanging with rope on her neck”.
Nwabuzor said she was rushed to the hospital and then to the mortuary after she was confirmed dead. (Adapted from a Vanguard report).
Anambra: CP Aderemi Adeoye Decorates Promoted Officers With New Ranks
The Anambra State Police Command Headquarters Conference Hall was a hive of activity Thursday as CP Aderemi Adeoye took turns decorating around 18 promoted officers of the command with their new titles.
The delight of some of the officers whose wives assisted the CP in decorating their husbands with their new ranks knew no bounds, as their husbands duly saluted their wives and the CP for their new positions and responsibilities.
Obi Innocent, one of the officers elevated to the rank of Chief Superintendent of Police (CSP), whose wife joined CP Aderemi Adeoye in adorning him with his new rank, said it was wonderful that the Inspector General of Police thought him worthy.
CSP Obi Innocent, the officer in charge of the Legal Department at Zone 13, Police Zonal Headquarters Ukpo, stated that his new rank was a call to service and that he would do his best to uphold the charge given to them by CP Aderemi Adeoye to respect and protect the citizenry’s fundamental rights in the discharge of their new assignments.
Charity Akharame, who was honoured with the rank of Deputy Superintendent of Police (DSP) and was the only female officer among the 18 promoted officers decorated with new ranks, said it was not an easy feat but she was grateful to be among those who were decorated with their new ranks.
DSP Charity Akharame, the officer in charge of stores in the Anambra State Police Command, recalled how she began as a Police Constable and worked her way up to her current position as Deputy Superintendent of Police.
She stated that as a very disciplined police officer, she would follow the Police Commissioner’s directions regarding respect for all and sundry in the fulfillment of her constitutional obligations.
Jane-Frances Obi, one of the spouses of the officers elevated to the level of CSP, stated that being the wife of a police officer was not an easy assignment. As a result, she recommended any lady who is married to a police officer to be patient and understanding because the job is quite demanding.
Jane-Frances Obi, whose husband is Innocent Obi, the officer in charge of the Legal Department at Zone 13 Ukpo, believes the promotion is a reward for years of being patient, understanding, and standing in for them when they are not present.
Meanwhile, Emenike Chinenyenwa, who was decorated with the rank of Assistant Commissioner of Police (ACP) and presented a vote of appreciation, expressed deep gratitude to the IGP and the Chairman of the Police Service Commission for considering them worthy of being adorned in their new ranks.
ACP Emenike, the officer in charge of Medicals, stated that the elevation comes with increased responsibility and that they will work harder in their new tasks.
CP Aderemi Adeoye praised the current promotion winners in his remarks, noting that two aspects make the police career very interesting and eventful. He stated that one is for promotion and the other is for positions.
CP Adeoye, on the other hand, urged the newly honored officers to develop more empathy, compassion, care, and dedication in the performance of their jobs.
The police chief insisted that newly promoted officers must first recognise that they share the same humanity as others, and as a result, they must treat all people with dignity and protect their fundamental human rights at all times.
CP Aderemi Adeoye stressed that without the enormous roles of spouses, they wouldn’t have been successful in their careers. He therefore congratulated all the promoted and prayed that God gives them good health to enjoy the new ranks and the energy to discharge the responsibilities of their new offices.
- Source: Independent