The Governor, Central Bank of Nigeria, Godwin Emefiele, has enjoined Nigerians to support the production and consumption of domestic products, as the country may not have foreign exchange (forex) to support such activities in the future, if we continue relying on earnings from crude oil export.
Emefiele made this statement in Lagos during the 2019 annual bankers’ dinner.Kicking against high rate consumption of foreign goods in Nigeria he said “We must therefore support measures that will drive domestic productivity and diversify our export base.
“We should encourage Nigerians to consume goods that can be produced in Nigeria, knowing full well that a time will come when we may not have the foreign exchange to aid such activities, if we continue to rely on earnings from the export of crude oil.”
Emefiele strongly believe that it is indeed possible for us to envision a productive Nigerian economy that is not reliant on exports of crude oil, adding that at some point in Nigeria’s history, the country had an economy that supported productive activities, which created multiple streams of earnings for our nation.
The CBN Governor while speaking on the topic, ‘Strong sustainable growth for the Nigerian Economy’, recalled that in the 60s, Nigeria’s economy was heavily reliant on agriculture, with increased cultivation and exports of primary products such as cocoa, palm oil, cotton and groundnut.
Speaking further he said ” The Agricultural sector in 1961 represented close to 70 percent of Nigeria’s GDP, and generated close to 70 per cent of our export earnings.”
“It was the principal source of employment, as over 85 per cent of Nigerians lived in rural communities.
These agricultural products also supported the food needs of our nation and provided raw materials for emerging industries.”
He stated that the revenues generated from the export of these products helped to fund the infrastructure and human capital needs of the various regions.
“We are all aware of how the export earnings from cocoa built the Cocoa House in Ibadan; export earnings from palm plantations supported the development of agricultural settlements in the eastern region and the Trans Amadi Industrial Layout in Port Harcourt.” he added.
According to him, the sale of groundnuts and cotton supported developments in the northern region while the diversified economic structure then helped to improve job creation and wealth generation across the various regions.
He, however, pointed out that In the late 1950s, revenue from petroleum products were insignificant, amounting to less than two per cent of nation’s total exports, noting that between 1960 and 1973 annual oil output exploded from just over 5 million barrels to over 600 million barrels.
Emefiele stated that Improved oil production led to a high dependence on crude oil for not only government revenues but also for our export earnings, stressing that agriculture’s share of our GDP as well as our non-oil exports declined gradually as higher wages and earnings from crude oil, only served to encourage consumption of foreign goods and excessive importation of raw materials to the detriment of our local economy.
