By Kunle Somoye
The adage that “tough times do not last, tough people do’’ is fast becoming the experience of Nigeria in its fight against economic recession. It is also relevant to confirm the saying that “God is a Nigerian’’ in the sense that the speed at which the nation is coming out of recession remains unprecedented, indicating that the hand of the Almighty is on the country.
When Muhammadu Buhari took over as President in 2015, he inherited an economy that would have made a faint hearted abandon a duty post. At that time, Nigeria was plagued with myriad of challenges which included disruptions in the oil sector as occasioned by fall in global price of oil and disrupted supply.
The developments caused an acute drop in supply of foreign exchange, which plunged the nation’s economy into a recession.
On assumption, President Buhari’s first action aimed at attacking recession was to insist that Nigeria and Nigerians produce what they consume and consume what is produced locally. This position formed the philosophical base of the Federal Government’s diversification policy.
Not too long after the pronouncement, results started manifesting in the agricultural sector. Latest figures shows that the sector is leading Nigeria’s non-oil export by $105.06 billion and this stands out as a strong indication that Nigeria has started raising its head above the water of recession and that productivity as against sharing revenue from oil, is fast becoming the order of the day.
Between 2015 and 2017, Nigeria witnessed the establishments of its largest rice-processing mill, the second largest single line petroleum refinery, second largest urea fertilizer plant and the second largest chemical complex.
Tax incentives for three years have also been given to local industries to enable ease the process of doing business as well as provide opportunities for the creation of new jobs.
With the establishment of the largest cement-producing complex in Africa, foreign investors are encouraged to buy stakes from Dangote cement.
So far, private investors have subscribed to about 2.1 per cent stake in the company, which amounts to about $236 million. This is an indication that the confidence of foreign investors in the Nigerian economy is on the path of growth.
Furthermore, with the Olam group investing $150 million in the establishment of the largest poultry farm coupled with an integrated feed mill in sub-Saharan Africa in Kaduna as well as another $120 million investment in Vicampro potato farm that has the prospect of generating 30,000 jobs, all is now set for Nigeria to record a quantum leap in its economic growth.
Another proof of investors’ confidence manifested when a company with French parentage, Lafarge Nigeria, the second largest cement-producing factory in Nigeria, converted the loan it granted the local arm of the company into equity. This is also an indication that foreign investors are no longer in a hurry to leave Nigeria.
Economic recovery also is on upward movement with the Manufacturing Purchasing Managers’ Index (PMI) standing at 54.1 per cent. This means that Nigeria recorded expansion in production. On the other hand, there is a strong indication of growth in the Nigerian Stock Exchange (NSE) and the Financial Markets Dealers Quotations (FMDQ).
A N10,000 investment in the NSE in January 2017 is capable of yielding N3,300 in six months. Such capital gain cannot accrue as interest rate when same amount is invested as deposit.
The simple deduction from these activities is that the nation is exiting from economic recession while at the same time growing rapidly. It demonstrates that the government has developed and is implementing concrete plans to attain a set target. With a 4.3 per cent growth rate as against the 2.8 per cent growth projection from the World Bank, it means that the big deal is on the way.
The recession has proved that the never-say-die-attitude of Nigerians to challenges should be emulated by other nations as all intents and purposes point to the fact that the nation is not wobbling out of its economic challenges but buttresses that good and implementable strategy, clear focus and an enabling environment are the necessary ingredients to pull such tough strings.
The feat achieved so far proves that it takes a disciplined government to take Nigeria out of a mono economy and conquer the world through economic diversification.
To further cement and improve the current achievements, the government can do more by creating business clusters, mechanic workshops and industrial estates in order to deepen the expansion of the productive sector. By the time the expansion of the productive sector has been deepened, Nigeria will once again prove to the world that converting a frustrating condition into an opportunity is its stock in trade.
Kunle Somoye, a Public Affairs analyst, wrote from Abuja and can be reached via firstname.lastname@example.org