Why the Nigerian economy cannot be growing

by Odilim Enwegbara

Is an economy with high interest rates, high inflation rates, and high unemployment rates growing? Should a highly import dependent and infrastructure deficient economy, be economy? Should growth be synonymous with disappearance of middle-class, poverty, social disenfranchisement, insecurity, and corruption? Should a jobless economy with over 80 per cent unemployment be growing? But what should explain this so-called growth in the presence of inherent competitive disadvantages?

Can an oil dominated economy be growing without corresponding growth in oil production and export? Or, what else should have been behind the presumed growth? Can the economy be growing because its accumulated foreign exchange reserves are being depleted by massively importing finished goods, rather than massively importing industrial machinery and technology based total-factor productivity? How can a nation ranked as the world’s number one dumping ground for foreign goods, whose 170 million consumers depend entirely on imported goods, claim to be growing? Can our economy prematurely exposed to the WTO hammers be growing while its sovereign borders are open to all manner of imports?

If what’s being celebrated is the growth that comes from selling on average 2.5 million barrels of oil daily, happening with no government’s contribution, then, one should wonder the celebrants have given a thought to the fact that the economy is so caught up in a macroeconomic tight spot, in a fiscal and monetary policy ambush due largely to the country’s outsized infrastructure deficit as well as excessive import dependency, perpetuated by our externalized petrodollar economy? Or shouldn’t real growth be internally-driven rather than externally-driven by imports and oil export?

Is there any anti-dumping policy or import substitution industrialization strategy in place to lure or force foreign dumpers to begin relocating some of their factories to Nigeria, at least those polluting factories? In other words, do we’ve in place some carefully constructed mix of protective measures, including bans and high tariff walls designed to discourage imports and encouraging infant industry promotion and protection?

If no one is fantasying and fabricating these so-called growth figures, then, how come no one is talking about the supposed accompanying job growth figures; or is it happening without people having to feel the impact through employments? How puzzling could it be that it’s happening in such fiscal austerity and tight monetary policies, designed to suffocate the real sector as well as destroy productivity? Why are the announcements coming mostly from imperial multilateral financial organizations like the IMF, World Bank, and KPMG, known for their fierce opposition to our country’s real development?

That these imperial organizations wrapped around the infamous National Security Study Memorandum 200 (NSSM200), a US foreign policy hegemony instrument which since it became law in 1975 has been always deployed by the CIA, CFR, USAID, WTO, State Department, Rockefeller Foundation, as well as Fitch, Moody’s and S&P to undermine Nigeria’s regional economic and military power rise. And that same Fitch recently raised Nigeria’s rating from BB-Negative to BB-Stable, the same S&P raised its rating of our economy from B+ to BB-Stable, and the same World Bank could in its so-called Voice Enhancement Program, place Nigeria among the 16 countries in the world whose voice has increased, showed something fishy here. The fact that it’s the same rating agencies that continued giving clean bill of health to our comatose banking industry even when it was giving up the ghost in 2009, should sound an alarm bell to all of us.

But who says that wonders shall ever end? Who says that a country trapped in the importation of fuel, it should be exporting; importation of food it should be exporting; exportation of millions of jobs it should be growing at home; that forces citizens overseas as health tourists as well as in search of better universities education overseas, should be the last to accept some mockery growth rates, as its economy is run on private generators, lanterns, and candles? Or could it just be their way of expressing solidarity to Mrs. Okonjo-Iweala, who remains one of their own on sabbatical in Nigeria?

What makes this whole story perplexing is that it’s the same pushers of World Bank and IMF neoliberal textbook economic development theories, a team whose fiscal consolidation, fiscal austerity, anti-growth, and anti-job economic policies are fast dragging us down the bottom pit that are loudly celebrating this so-called growth. It couldn’t be more puzzling, considering that all these high ratings are coming when our real sector economy is literally suffocated by some Asian commercial invaders. That given all these negatives, the economic team insists that our economy is growing, then, we should find out what defines economic growth. If there is not accomplice, then, the economic team should be so grossly clueless not to know that this is not the time for celebration, but rather than for sober.

Has government repealed the poorly articulated ECOWAS open border agreements, being exploited by ECOWAS member countries like Ghana, who use their disproportionate investment in the power sector to lure most Nigerian industries to relocate to their countries; or countries like Benin becoming transit nations to Asians desperately wanting to dump their goods in Nigeria? It is mind-boggling that here is an economic team that does not observe that by allowing those countries to dump their products in Nigeria under the pretense of ECOWAS border agreements, while our industries are either forced to shut down or to relocate their businesses. In short, it’s unbelievable that drums are being rolled out in celebration while our neighbors are exploiting these ECOWAS agreements.

Is that how we practice self-serving economic diplomacy, diplomacy of no permanent friends or enemies but permanent economic interests, practiced today by every modern economy? How many Nigerian ambassadors today carry corporate suitcases wherever they go to represent Nigeria like their Chinese, Americans, and Europeans, South African counterparts? Has this government considered it important to be educating Nigerians on why economic patriotism should be taken seriously to the point of patronizing made in Nigeria no matter the cheapness of foreign goods since that is the only way to encourage local businesses to grow and create jobs?

That we are also rolling out drums for CBN’s tight monetary policy, a monetary policy that rather than promote investment in the real sector is flooding hot money into the highly lucrative financial sector — particularly the stock market and government bonds. That CBN is systematically depriving the economy the very oxygen that should keep it alive, in the presence of such squat standards of living, embarrassing poverty, and increasingly army of jobless and hopeless youth is difficult to imagine that no right thinking Nigerian is publicly opposing such anti-growth, anti-development policy measures. And that rather than such narrow fighting of inflation that hardly preoccupies itself with how such policy stifles the real sector and employment, shouldn’t the CBN be forced to stop this anti-growth monetary policy? Celebrating monetarist policy that diverts investment away from the real sector — investments badly needed for the growth the very sector, the sector that holds the key to millions of job creation as well as government tax revenues is truly inconceivable?

In other words, that no one in government seems alarmed by the current flood of hot money, unregulated foreign portfolio investments taking full advantage of the huge arbitrage in our capital market, especially with such absence of capital gains tax policy in the system, shows how all of us have been hit by the neoliberal financial hit men and women who have freely unleashed havoc on our financial econom

y. What makes the whole thing dangerous is that all this is happening when the naira is kept artificially high through high interest rates and stable exchange rates.

That the same foreign dumpers of goods are reinvesting in our country part of their huge profits made from Nigeria in an effort to keep the naira continuously overvalued so that we continue patronizing their goods shouldn’t be surprising, after all, if these mercantilist Asians could trick the almighty USA to falsely believe that its economy was growing when it’s being propped up with Asian profits until the 2008 financial tsunami woke Americans up from their long slumber, who are we not to fall prey? Maybe racist German philosopher, George Wilhelm Friedrich Hegel (1770-1831), was right in claiming that, after all, the African man has ”nothing harmonious with civilization…and, therefore, has no movement or development to show.”

While we can all debate whether or not the economy is growing, the final arbiter is the Nigerian voter. If oil prices could suddenly plunge to the extent that our largely unproductive debt could force the economy to give way, especially if it happens during the time of electioneering campaigns, as was the case in the US in October 2008, precipitating John McCain’s Presidential ambition, no doubt, it would put PDP in a difficult corner. Whether that happens or not, April 2015 remains a month PDP and the President have to face the Nigerian electorate with their performance scorecards. When that time comes, obviously no one should mention Okonjo-Iweala’s role since she is not a candidate. Should PDP encounter difficulty, of course, she should be returning to Washington; maybe with another high position awaiting her for the job well done, as she was rewarded for paying $12 billion to the Paris Club, a club of western thieves. Maybe she would prefer to wait for Mr. Jim Yong Kim to complete his tenure on June 30, 2017. That is the irony of handing a people’s economy to some free-rider technocrats.

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