Economic growth means an increase in real Gross Domestic Product (GDP). This represents an increase in the value of national output, income and expenditure.Essentially, the benefit of economic growth is higher living standards, higher real incomes and the ability to devote more resources to areas like healthcare and education, two crucial areas in need of development in Nigeria.With higher output and positive economic growth, firms tend to employ more workers, creating more employment. Higher economic growth leads to higher tax revenues, and this enables the government to spend more on public services.This can lead to achieving higher living standards, increased life expectancy, higher rates of literacy and a greater understanding of civic and political issues.
However, like in other countries, Nigeria’s pursuit of economic growth and sustainable development can be best achieved if the ethos of merit in public life is upheld.It was in recognition of this fact that Vice President Yemi Osinbajo said this week that Nigeria’s desire and pursuit of economic growth and sustainable development is best achieved through the adoption of merit as a national value.The Vice President said this in an address he delivered at the Nigeria Leadership Initiative (NLI) webinar series themed: “A National Conversation on Rebuilding our National Values System.”Meritocracy, Osinbajo said, is crucial because it is only if it is observed that the two essential elements needed for economic development, talent and enterprise, can be rewarded.“Meritocracy is crucial as a value in and of itself,” he said. There is no doubt that the moment that the country departs from the path of meritocracy, it has lost its way to development.It is only when the principle of merit is respected that public institutions can efficiently work and get equipped to provide opportunities to Nigerians, regardless of tribe, religion or gender.
Equally crucial for development, Nigeria’s number two citizen talked about, is the necessary element of trust. Of course, trust breeds confidence, without which there can be no economic growth because there will be no investment and peoples’ trust in government’s policies will suffer.“Economic growth rests upon the substructure of values,” the vice president said, adding: “When we say that there is a credit crunch, we are referring to a lack of trust. This has significant implications for the economy.”Rightly, the vice president points out that banks cannot lend to people when fraud is widespread, and enterprise and industry cannot flourish without credit.Above that, financial institutions, which are crucial to investment, may also be reluctant to lend because they cannot trust the government to remain consistent with regulatory policies.For the same reason, investors may be discouraged from investing while it is known that Foreign Direct Investment (FDI) has a crucial role in the economic growth of economies.The advantages of foreign direct investment are to attract the capital, knowledge and increase the balance of payment. Foreign direct investment is known as the pivotal component of the economy.There are many reasons to show that there is a positive effect of FDI on the growth of all developing and under-developing countries.
It is widely recognised that foreign direct investment produces economic benefits to the recipient countries by providing capital, foreign exchange, technology and by enhancing competition and access to foreign markets.With the increase in the level of FDI, there will undoubtedly be an increased liberalisation of trade in Nigeria. In order to attract FDIs, there is, however, the need to initiate friendly policies and develop the foreign investors’ confidence as foreign direct investments are affected by uncertainties of government policies.Yet, an even more crucial issue raised by Osinbajo in his speech is the need for Nigeria to deal ruthlessly with the cankerworm of corruption that has for too long denied the country of sustainable economic development.For example, tax is more than just a source of revenue and growth for countries. It also plays a crucial role in building up institutions, markets and democracy through making the government accountable to its taxpayers.
In developing economies like Nigeria, lack of tax structures is a major cause of weak, unresponsive governance. With tax, the public can hold governments to account for their decisions.Therefore, citizens who think that their taxes will be embezzled due to official corruption, as it is often the case in Nigeria, are unlikely to see any value in paying their taxes.In essence, the roles played by trust in the process of achieving proper workings of any economy and society are far-reaching and significant.Thus, in agreeing with Osinbajo, who pointed out that Nigerians should focus their attention on merit as a crucial factor for society’s economic survival, social justice and development, the need to fight corruption cannot be overemphasised.
Agreed, too, that Nigeria has many development challenges, but to solve them, the government needs to address the monster called corruption.No doubt, President Muhammadu Buhari is well aware of this. But it is imperative for his administration to adopt innovative and practical ways to deal with the menace. Otherwise, the dream of development of Africa’s biggest economy will remain unfulfilled.
Prioritising nationwide rail-lines projects
As the President Muhammadu Buhari-led administration continues to its effort to build critical infrastructure in Nigeria, the Federal Executive Council (FEC) has approved $3.02 billion for the reconstruction of the Port Harcourt to Maiduguri rail-line.The Port Harcourt to Maiduguri narrow gauge railway will have new branch lines from Port Harcourt to Bonny and from Port Harcourt to Owerri with a connecting narrow gauge to standard gauge at Kafanchan. There will also be a branch line from Gombe to Damaturu and Gashua.Unlike successive administrations in Nigeria who have proved not to be as farsighted, the Buhari-led administration appreciates the role modern rail transportation is going to play in promoting and sustaining the expanding market and economy of Nigeria.As intended by the government, when completed, the rail-line will link many states in the North and South of the country.This piece of good news was disclosed by the Minister of Transportation, Mr Rotimi Amaechi, at the end of the weekly FEC meeting presided over by the President.Economic analysts say that Nigeria may be losing as much as N500 billion yearly to the dysfunctional commercial freight rail service linking Apapa in Lagos to other parts of the country.Of course, that may be insignificant compared with what the country is losing currently due to the inability of successive governments maintain or expand on the railway lines left behind by the British colonialists.
Understandably, the Buhari-led administration has a chance, and it is clearly not wasting that chance, to make a difference in this important subsector of the Nigerian economy.
Rail is a smart, sustainable and efficient way to move freight and people. Trains promote economic growth, cut greenhouse gas emissions, and are a compact, clean way to move millions of tonnes of goods and millions of passengers across cities.While there are definitely some challenges when it comes to implementing rail projects in Nigeria, where reform is needed in the way that railroads are financed and organised, rail transport is particularly useful for urban and inner-city settings.Rail provides numerous advantages ranging from social to environmental, and it’s also one of the best options for public transport based on the amount of fuel and emissions per passenger, the number of passengers carried, reduced road accidents, lower costs and increased safety.
Physical connectivity between rural and urban areas is essential for economic growth in a country like ours where, clearly, improved mobility is a necessary factor for reducing poverty and allows people from rural areas to commute to urban areas where more excellent employment opportunities exist.In fact, it is difficult to measure the economic benefits of rail due to its potential spillover effects. For example, the area where a rail-line exists could see increased prosperity and, therefore, greater demand for products in neighbouring areas. One of the major transportation problems in Nigeria is inadequate operational railroads. The lack of functional railroads connecting the ports to major cities have forced marketers to transport their goods and products entirely by road, and this means the roads have to bear the extra load of haulage trucks and petrol tankers across long distances, leading to traffic accidents and other inconveniences for road users.These and other problems associated with our country’s flawed railway system must be addressed by this administration for the overall development of Nigeria.
