Statistical information in Nigeria about income, employment and unemployment is very inadequate. This deficiency cannot be remedied quickly, as the necessary work is both complex and costly. But this deficiency should not be considered a pre-condition for action designed to alleviate the most serious conditions of poverty. Often, available but unused statistical information may be used for policy purposes at comparatively little cost. The important thing is to identify the extremely poor sections of the society, and seek to alleviate their miserable conditions. In Nigeria, as well as in other developing countries, the economic gains of the 1970s have been virtually wiped out by massive foreign debts, declining national income, and growth rates. The problems of mass poverty are massive, growing and urgent. These problems require urgent attack despite our present economic difficulties. Radical courses are needed. We must formulate and implement policies that seek to move our poverty-reduction and employment goals from the periphery towards the centre of our development plans. We must become as concerned with income and output distribution as with income and output generation. We must adopt programmes with direct benefits for the very poor.
Development Planning
The urgency of finding solutions to our acute problems has been recognised at all levels of our country. But this should not create the illusion that much can be gained by us through rhetoric, or by appeals to nationalism or patriotism. Important as these are, they are not a substitute for plan discipline, or for the dangerous notion that industrialisation need no longer serve as a vehicle for useful technological transfer and, or, adaptation. Any such notion is a pure fallacy. Despite our present economic difficulties, our long-term objective must be to assist the industrial sector of the economy to recover from its present slump, so that the present level of unemployment may be reduced by the creation of jobs in the industrial sector. Our ongoing planning efforts should guide development activities and allocate resources to those sectors of the economy that have a multiplier effect on the economy, particularly for the purpose of generating employment. In addition, to our efforts to carry out economic reforms should include a close examination of the functioning of the existing market mechanisms which have tended to distort the economic structure in Nigeria.
The Process of Industrialisation
It is imperative that we continue to regard industrialisation as an essential part of our development strategy and a vital component of our development strategy to counter poverty and unemployment, as industrialisation will, in the long run, play a most important role in the economic growth and social transformation of our country. This is not to suggest that we should pay less attention to the agricultural sector of our economy. Far from it, for a vibrant agricultural sector is itself a pre-condition for a viable and strong industry. But industry is the most dynamic sector of the economy, where productivity usually increases at the highest rates. It can make a very important contribution to the development of other sectors of the economy, particularly agriculture, but also transport and services. Industrial production requires skill and organisation; therefore, its expansion promotes desirable work habits. We need, therefore, to keep our national investment rate in industry sufficiently high so as to promote employment.
One important qualification is that we need to make our industries more labour-intensive, and more cost effective. Our industrial policy should be closely linked with policies that are not only aimed at output expansion, but employment generation. Hence, the importance of small-scale and rural-based industries. Many types of simple equipment and machinery can be manufactured in small and medium-sized enterprises, using local materials and labour-intensive techniques. In addition, we need to take a closer look at the structure of incentives and tariffs which tend, on the whole, to favour capital intensive and consumer-oriented industries. This is one of the key factors militating against the use of local raw materials.
Agricultural and Rural Policies
As we have pointed out, our stagnant agriculture is an inherent weakness of the Nigerian economy. Until recently, Nigeria was spending on food imports the staggering sum of N2billion, or 25 per cent of its GNP. Even with the recent reforms, a sizeable chunk of our foreign exchange is still being spent on the procurement of food imports. Yet, the population growth rate is such that by the end of the century, Nigeria’s population, now estimated at 100 million, will be close to 150 million, or more; thus imposing a further strain on an economy that appears to be so totally dependent on external sources even for its food supplies. A vigorous agricultural expansion is clearly needed to give impetus to economic growth, to relieve food shortages, to combat malnutrition, to curb inflation, and to alleviate pressure on the balance of payments. Indeed, the objective of a prosperous rural sector needs to be at the centre of our strategy against mass poverty. To ensure the continuation of the present agricultural momentum in Nigeria, however, considerable changes in agricultural policies are required.
First, we need to review the provisions of the Land Use Decree, so as to facilitate acquisition of land for farming. Land remains one of the major constraints to agricultural expansion in Nigeria. Many local and foreign companies that would like to go into agriculture on a big scale are faced with the practical difficulty of getting land at prices they can afford. Many of the state governments regard the quest for agricultural land as an opportunity to charge exorbitant fees that are totally unrelated to the actual value of the land being sought. In addition, great care should be taken not to adopt policies that may be detrimental to the small scale farmers. Experience in several countries, such as Zimbabwe and Kenya, with more successful agricultural sectors than Nigeria, has shown that output per acre in many important food and cash crops is usually higher on small holdings than on large farms. In addition, small scale cultivation can not only lead to greater production, but also to more rural employment and better distribution of income. But much more important to a successful agricultural policy are the provision of extensive services, and the application of the results of the research institutes, particularly with regard to the development and distribution of high yielding crop varieties. It is a matter for regret that the government decided recently to reduce the subsidy on fertilisers by another 10 per cent. The financial gains accruing to the government as a result of this measure in no way compensates for the inevitable loss of momentum. This measure is bound to have a deleterious effect on the small scale farmer, who remains the back-bone of the agricultural sector.
As in industry, there is a growing tendency in Nigeria today to favour mechanisation in the agricultural sector. While mechanical equipment have valid uses in agriculture in meeting the cycle of sowing and harvesting, we should be careful to avoid a situation that could lead to the under-utilisation of abundant labour in the rural areas due to a preference for mechanical equipment. It is also important to treat our agricultural policy as part of our rural development programme, which should encompass many activities besides farming. Complimentary employment possibilities may be found in a number of agro-industrial activities. These ancillary activities which should include handicrafts should give a spur to the modernisation of the rural sector, and thereby help to bridge the gap separating it from the urban sector. The creation of job opportunities in farming and in ancillary activities in the rural areas should continue to be supported by the provision of credit on favourable terms, the provision of extension services, the improvement of transportation, the construction of feeder roads, the expansion of marketing facilities, and the provision of training and management advice.
Conclusion
It is evident from the remarks that I have made that I see the whole question of increased productivity more in terms of man than goods. I believe that the best measure of productivity is the extent to which jobs are created, and basic human needs met. To conceive of, or define productivity in terms merely of output of goods is, in my judgment extremely narrow. As the late renowned economist once said, ‘development is about people, not the output of goods’. Thank you for your attention.
NATION
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