The managers of Nigeria’s economy had a mixed grill last week. The National Bureau of Statistics (NBS) released a report showing foreign investment growing by a record 138 per cent from $5.3 billion in 2016 to $12.2 billion in 2017.
Jubilation over the landmark improvement in foreign exchange inflow was just gathering steam when the International Monetary Fund (IMF) punctuated it with reports that Nigerians were poorer even as Nigeria was getting richer.
The IMF message was rather vague. It was silent on the percentage of the nation’s population that was pushed down the poverty line in 2017.
However, no one can contest the verdict of the Breton Woods institution on the poverty level in Nigeria. The IMF was merely amplifying the verdict of the Africa Development Bank (AfDB). In the closing days of 2017, the AfDB announced that 80 per cent of Nigerians were wallowing in abject poverty.
That was an incredible 10 percentage points above the World Bank verdict that 70 per cent of Nigerians were living below poverty line. The population of Nigeria is currently estimated by the World Bank at 192 million.
The AfDB verdict of 80 per cent poverty rate translates into 153.6 million Nigerians living below poverty line. That apparently is an appalling record for a country with Nigeria’s resources.
The IMF believes that Nigeria’s economy lumbered out of recession in the second quarter of 2017 not because of stringent economic policies articulated by the federal government, but because of the recovery in oil prices and the decision of the militants in the oilrich Niger Delta to sheath their swords and allow oil production to rise.
It warned that the uncertainty of election year politics in 2019 and a possible drastic drop in oil price could plunge Africa’s largest economy back into recession. Nigeria’s gross domestic product (GDP) stood at $405.1 billion in 2016.
With a 1.9 per cent growth in 2017, it could be argued that the GDP now stands at $413 billion. Under normal circumstances, the mild growth would have pushed at least an infinitesimal fraction of the population out of poverty.
Unfortunately it pushed more into penury.
There are myriads of factors militating against the federal government’s tepid fight against poverty. One of the factors is the country’s weird income distribution system. A handful of privileged political office holders have selfishly allocated a disproportionately high chunk of the nation’s lean resources to themselves.
Nigeria’s lawmakers are the best paid in the world. Besides, less than 600 former heads of state, their deputies, governors and their deputies glean a minimum of N1 trillion annually from the nation’s lean purse to fund their severance package, pension, healthcare, support staff emolument, housing, furniture and fleet of limousines.
The federal government employs less than one per cent of the nation’s labour force. Ironically it spends 70 per cent of its annual budget on salaries and allowances. Th at leaves a scant 30 per cent for infrastructure development and welfare of 191 million citizens.
The skewed income distribution system kept unemployment rate alarmingly high in the 10 years that the economy grew at an average of six per cent annually. Corruption is at the root of the federal government’s alarmingly high recurrent expenditure. Th ousands of ghost workers and pensioners infest the federal government pay roll.
Each time they are weeded out, they sneak back into the system within months. The ghost pensioners in the federal government pay list are responsible for the mountain of debt to real pensioners. The high and mighty in the federal civil service cannot feign ignorance of the pension scam.
A former head of service was even indicted in the scam. He slipped through the trial on technical grounds. The next reason for the abject poverty is the country’s unmitigated population growth rate. Nigeria’s population grows at the rate of almost three per cent per annum. At the current rate, 5.7 million babies arrive the country every year.
Under normal circumstances, the economy has to grow at twice the rate of the population for the country to push some people out of poverty. At the best of times, the economy had grown at about the same pace with the population, thus pushing more people below the poverty line.
Even when economic growth doubles the alarming population growth rate, a skewed income distribution system allocates a disproportionately high chunk of the income to a tiny fraction of privileged politicians, thus leaving the inconsequential majority to wallow in poverty. Since Nigeria has failed woefully in the crucial tasks of growing the economy and distributing the income evenly, it should do a hard fi ght against population growth.
People should be restrained from raising the number of children they cannot fend for. A man who earns N20,000 per month should not marry four wives and raise 20 children. We have reached a point where population control should no longer be voluntary. Every family should be compelled to peg the number of children at three.
At the current growth rate, Nigeria’s population would cross the 200 million mark in two years time. By then 180 million Nigerians would be in abject poverty.