Making Nigeria competitive in global trade

Nigeria’s economy is going through challenging times. The National Bureau of Statistics (NBS) recently released a report that 11.55 million Nigerians are jobless while unemployment and underemployment rates rise to 14.2 percent and 21.0 respectively in the last quarter of 2016.”The Acting President, Yemi Osinbajo, has just inaugurated the National and Industrial Policy and Competitiveness Advisory Council to enable the country to be competitive in international trade. The Acting President believes that the Advisory Council will “rescue and save our country and give our country a real chance to be competitive in global business and commerce.”For Nigeria’s exports to be competitive globally, several activities must happen together in a sustained manner.

Firstly, Nigeria must be able to add value to natural and mineral resources. The era of exporting natural and mineral resources in their raw state is gone in order to be competitive. It is uninteresting to know that Nigeria produces about 1.8 million barrels of crude oil/ day, but imports about 80 percent of petroleum products consumed. Nigeria ranks third highest importer of petroleum products in Africa, spending almost N49 trillion in the process in the last 17 years. Nigeria cannot prosper with reckless spending, and a debt of about N19 trillion. For the nation’s economy to prosper, Nigeria must produce, and most importantly, add value to mineral and natural resources for export. This can be achieved through the use of appropriate technology. We must think technology. Technology is the index that can make our economy competitive and sustainable.

Secondly, Nigeria must evolve strategies to upgrade existing indigenous technology and take advantage of the nation’s status as a latecomer in science and technology. How is Nigeria going to bridge the gap, and perhaps, catch up with nations having advance technologies? Nigeria does not have to invent most of the production or process technologies that will enable firms to be competitive. Nor does it have to start with the oldest technology and follow the same path and progression more advance nations followed. I strongly believe that Nigeria has the potential to leapfrog and move directly to more advanced technologies, provided policy makers put their acts together. The rapid technological progression entails building domestic capacity to find existing technologies, adapt them for local use, and incorporate them into the production process. The Twenty-first Century differs largely from the Twentieth Century where humanity dominated one another by the use of force. The Twenty-first Century is dominated by nations producing quality goods and services which incites trade competition in which the winners are those nations and regional blocs that have not only invested in science and technology, but have a common market policy. It is only countries that make science and technology the pivot of their industrial development strategy that will develop.

Thirdly, Nigeria must not ignore the role of Research and Development (R&D) in its drive for competitiveness. The vast majority of technologies required to reduce poverty, add value to natural resources, and upgrade the technological proficiency of local industry have already been invented. They are in extensive use in many industrialized nations. Since R&D is costly and risky, and Nigeria is in economic recession, the federal government (FG) should develop capacity to use existing technologies. This requires developing engineering, technical and vocational skills rather than conducting frontier-level R&D. For a poor nation, R&D efforts should focus on solving local problems in industries.

Fourthly, quality of education is very key. Nigeria must not focus only on basic literacy with the exclusion of secondary and tertiary education in an attempt to address its social and economic challenges. Strengthening higher education, along with technical and vocational education is essential for creating a globally competitive economy. A country with many primary and secondary schools’ dropouts will only compete on the basis of unskilled and low-wage labour. By definition, this is not a path to sustainable development, poverty reduction, and steadily rising standards of living. The greatest challenge before Nigeria in the next decade is how to reduce the ranks of the unemployed in both rural and urban areas of the economy.

Lastly, Nigeria must have a good business climate which must be paired with science and technology capabilities to develop an innovative and globally competitive economy. It is very demanding to have an economy achieve stability with double-digit inflation. Policies recently signed into law by the Acting President to promote good business climate and to reduce the cost of doing business must be faithfully implemented. Governments must not only insist that firms should pay taxes, it must create disparate incentives for entrepreneurs willing to invest in the country. It would be difficult building science and technology capability if the legal, regulatory, financial, and other economic conditions deter farmers, entrepreneurs and investors from investing and innovating in Nigeria. When we talk about capacity building, it’s not a passive process. Having a good business climate and the cost of doing business reduced significantly will not automatically improve productive capacity of a nation. It requires conscious, deliberate policies and programs in a sustainable manner.

Development economists know it was the marriage between science and technology that gave birth to what is being referred to as “modern economic growth.” It is only science and technology that will make the nation’s economy very resilient, sustainable, and competitive. Let me draw the curtain by paraphrasing former India’s Prime Minister, Pandit Jawahar LalNehru’s quotation: “It is science and technology that can solve the problems of hunger and poverty, of insanitation and illiteracy, of superstition and deadening of customs and traditions, of vast resources running waste, of a nation with abundant raw materials inhabited by starving people……” Nations that ignore science and technology do so at their own risk. Unless the federal, and state governments, show a clear understanding of the role of science and technology in economic development through policies and strategies, Nigeria remains technologically backward and economically dwarfed for many more years to come.

MA Johnson