Lecture delivered by Dr. Akinwumi A. Adesina, CON, President, African Development Bank Group, as the recipient of the Obafemi Awolowo Prize for Leadership Award on March 6, 2024.
Continued from yesterday
COVID-19 exposed the weakness of Africa’s health systems.
While developed economies spent $19 trillion in fiscal stimulus programmes, approximately 19% of the world’s GDP, Africa spent only $89 billion. Africa’s urgent need for basic vaccines was pushed to the bottom of global vaccines supply chains. At a time when Africa was unable to provide one basic shot of vaccine, developed countries were providing second, third and more booster shots. It was alarming watching an unprotected Africa grapple with this insidious virus. Some even projected that as many as 3 million Africans would die from the pandemic. Africa had just two testing centers, no medical gloves, no face masks, no medications, no vaccines. The African Development Bank immediately put in place a $10 billion facility to support African countries in their fight against the pandemic.
What is not acceptable or sustainable is an Africa that imports 70-80% of its medicines and produces just 1% of its vaccines. The health security of Africa’s 1.4 billion people cannot be subjugated to global supply chains or the generosity of others.
That’s why the African Development Bank also launched a $3 billion program to revamp Africa’s pharmaceutical industries and why it established the African Pharmaceutical Technology Foundation to support access to proprietary technologies from global pharmaceutical companies.
The Bank also launched another $3 billion program to develop quality health infrastructure across the continent, with special emphasis on primary health care systems, which if well fixed can assure basic health care for hundreds of millions of people.
We will continue to invest heavily in Nigeria to support its pharmaceutical industry and develop better health infrastructure.
It is imperative that Nigeria secures the health of all its population. This will require ensuring that no citizen travels more than a few kilometers to find a healthcare center. The widespread use of mobile health centers, e-health facilities, the digitalization of health systems, especially in all primary health care centers, health insurance policies for all, including innovative micro-health insurance pay-as-you-go systems, will capture the bulk of the population that is in the informal sector.
Third, Nigeria needs education for all.
Nigeria accounts for 15% of the total population of out-of-school children, according to UNICEF, with over 10.2 million at the primary school level, and 8.1 million at the Junior Secondary School. This is not a gold medal Nigeria should be proud of.
The problem is both acute and alarming in Northern Nigeria. Urgent public policies, coupled with community sensitization and incentives for schooling are needed, if this trend is to be reversed. Public incentives such as free and compulsory primary and secondary education should be put in place, along with massive investments in training and better salaries for teachers, building quality and safe classrooms, and school feeding programs.
A well-educated citizenry is critical for technological growth and development, and for fostering creativity, innovation, entrepreneurship and global competitiveness. We do not have a choice. A highly educated Nigeria is not an option. It is an imperative.
With only 1% of the population enrolled, Nigeria is currently not educating enough of its people at the university level. The poor funding of universities, a lack of basic infrastructure, poor incentives for faculty and staff, and incessant strikes due to wage disputes, have almost crippled the university system.
As a result, there is a mass exodus out of Nigerian universities, with 128,770 Nigerian students “Japa-ing” (moving) to study in UK Universities alone, between 2015 and 2022, according to the Higher Education Agency of the United Kingdom.
The mass exodus of students pales when compared to those of skilled professionals. From doctors to engineers, architects, lawyers, IT specialists, bankers, and medical technicians, Nigeria is witnessing a massive depletion of its human capital. This human capital hemorrhage will slow down economic growth, performance and overall development and competitiveness of the economy.
While one might argue that a growing diaspora is good as they send home some $ billions which is higher than the oil export earnings, this clearly is not the way to develop sustainably.
Nations that develop do all they can to keep their best human capital at home, and additionally source skills from elsewhere with flexible immigration and labor policies. We must make Nigeria a viable place for people to stay, and not a place to run away from. The same applies for other countries.
I refuse to believe that the future of Nigeria’s and Africa’s youth lies in Europe, North America, Asia or anywhere else.
I firmly believe that their future lies in a rapidly developing Nigeria, and Africa, that is able to generate quality jobs with competitive wages and a decent quality of life for millions of youths. That is why the African Development Bank Group and partners have provided $614 million to Nigeria for the i-DICE program to support the development of digital and creative enterprises, which are expected to create 6.3 million jobs and add an estimated $6.4 billion to the Nigerian economy.
To support the businesses of young Nigerians, the African Development Bank Group is also planning to establish a Youth Entrepreneurship Investment Bank in Nigeria which will provide financial instruments to create youth-based wealth.
Fourth, Nigeria needs housing for all.
A better quality of life requires access to decent and affordable housing for all. I remember growing up, how hard my father worked to be able to build us a decent house to stay in, after living for years in high-density areas, in what is called face-me-I-face you. What a joy it was to finally have our own rooms with baths and toilets. This joy eludes hundreds of millions of people in Africa, yet several governments stand watch undeterred and unflinching as millions of their citizens live in slums. Today over 65% of people in sub-Saharan Africa live in slums.
Let me bring this closer home.
In Nigeria, 49% of the population lives in slums, according to data by UN-Habitat. That is a staggering 102 million people!
These trends need to change, rapidly.
Welfarist policies are urgently needed to ensure that 100% of citizens have access to basic and affordable housing. The opprobrious policies that seek to upgrade slums should be jettisoned. There is nothing like a 5-Star Slum: a slum is a slum. Urgent actions are needed to support mortgage financing and re-financing and use of innovative financing structures to raise long-term capital for closing the housing deficits.
Fifth, Nigeria needs government accountability and fiscal decentralization for a true federalism.
Democracy is more than the right to cast a vote. It is the right of citizens to hold governments accountable for improvements in their welfare. Citizen accountability forums are needed in order to have a say in how their nation’s resources are being used and how their governments are performing. Governments must show concrete and transparent evidence of fiscal responsibility.
Governments without citizen accountability become synonyms for democratic dictatorship.
Today, therefore, there is a greater need for e-governance systems to enhance transparency and accountability of governments, in service of the people. That is what people-centered governance is all about.
That is why the African Development Bank is developing a public service delivery index that will rate governments on the quality of service delivery for citizens.
Development clearly requires a significant amount of financing, which governments need to raise. A primary tool for doing so is through taxation. The rationale for raising taxes in Nigeria is that the nation’s tax-to-GDP ratio is low compared to other African or non-African countries. However, taxation in the absence of a social contract between governments and citizens is simply fiscal extortion.
Participatory tax-based financing systems demand participatory governance.
Take the case of Norway for instance. Its tax-to-GDP ratio is 39%. It is easy to make the comparison and say Nigeria needs to raise its taxes from 6.1% of GDP to a similar level as Norway.
But consider that in Norway, like all the Nordic countries, education is free through university. And if you finish your course on time, any loans you took to feed yourself, clothe yourself and maintain yourself, are converted into grants.
We must distinguish between nominal taxes and implicit taxes — taxes that are borne by the people but are not seen or recorded.
Truth be told, Nigerians pay one of the highest implicit tax rates in the world. Most of the citizens provide electricity for themselves via generators; they repair roads in their neighborhoods if they can afford to. They provide boreholes for drinking water with their own money. In the 21st century, this is incredulous as every household should have pipe-borne water!
Sadly, the abnormal has been normalized.
If people pay taxes, governments must deliver services to citizens and be held accountable for their ability to do so or not. Governments should not transfer their responsibility to citizens. When governments or institutions fail to provide basic services, the people bear the burden of a heavy implicit tax.
To succeed with much-needed welfarist and people-centered policies across Nigeria, it is necessary to change the governance system and decentralized governance to states in order to provide greater autonomy.
States have tremendous potential to become even more financially autonomous through greater fiscal prudence. If states focus on unlocking the huge resources they have, based on areas of comparative advantage, they will rapidly expand wealth for their people. With such increased wealth, they will be able to access capital markets and secure long-term financing to fast-track their growth and development.
States that adopt this strategy would have less of a need for monthly trips to Abuja for grants. Instead, part of their federal revenue allocations can be saved as internal ‘state sovereign wealth funds’. This can then be used as a guarantee against borrowings from capital markets. In essence, they would be free from needing to exclusively rely on the federal government.
To get out of the economic quagmire, there is a compelling need for the restructuring of Nigeria. Restructuring should not be driven by political expediency but by economic and financial viability. Economic and financial viability are the necessary and sufficient conditions for political viability.
If there was one attribute that defined Chief Obafemi Awolowo, and there were many, it would be his visionary boldness. He went where others feared or failed to go. In the process, decades later, his footprints remain in the sands of time.
Likewise today, in Nigeria, we need men and women with vision, who are willing to take bold decisions.
Surgeries are tough. They are better done well, the first time. The resources found in each state or state groupings should belong to them. The constituent entities should pay federal taxes or royalties for those resources.
But let’s be clear. The achievement of economically viable entities and the viability of the national entity requires constitutional changes to devolve more economic and fiscal powers to the states or regions. The stronger the states, or regions, the stronger the federated units.
In the process, our union would be renewed.
Our union would be stronger.
Our union would be equitable.
Our union would be fully participatory.
Excellencies, distinguished ladies and gentlemen. We must be audacious!
Instead of a Federal Government of Nigeria, we could think of The United States of Nigeria.
The old would give way to the new.
We would change the relational mindset between the states and Abuja: the fulcrum would be the states, while the center would support them, not lord over them.
With good governance and better accountability systems, and zero tolerance for corruption, more economically stronger constituent states would emerge!
We would unleash massive wealth across the states.
A New Nigeria would arise!
To do so, we will need all of us — not some of us.
From our forgotten rural villages, to our boisterous and dynamic urban areas.
From the sparks of desire in the eyes of our children to the lingering hope in the hearts of our youth.
From the yearnings of our women and mothers and our men and fathers for a better tomorrow, and the desires of the old that our end would be better than our past.
From the hardworking street vendors and small businesses to the largest business conglomerates … we must create a movement of hope.
Hope for a better Nigeria!
Not a Muslim Nigeria.
Not a Christian Nigeria.
Not Eastern Nigeria, Western Nigeria, or Northern or Southern Nigeria.
But one Nigeria — a New Nigeria, created by a renewed commitment to turn our amazing diversity into exceptional strength.
A New Nigeria, powered by torrents of hope, trust, equity, fairness, and wealth at every level, in every state … by all and for all.
We have the capacity to do this and make it happen.
We must rise above mistrust and divisions and make history.
Not the history that is written about us, about Northern Nigeria, Southern Nigeria, Eastern Nigeria, or Western Nigeria.
Not the history of divisive political parties; but a new history that we commit to write for ourselves — the history of a new Nigeria.
We are the history makers. So, let us commit to making history for a New Nigeria!
For the darkness of today will soon fade.
It will not be long before our star shines brighter as a nation, as welfarist policies and people-centered policies spur shared wealth.
A nation where the majority prospers, not just the privileged few.
A nation that provides real opportunities for the youth.
A nation where equality of opportunities for women is a reality, not a dream.
A nation where hope is ignited, and dreams are realized.
A nation is known for wealth, not poverty.
A nation set on a hill whose light will never be hidden.
A New Nigeria that we all are proud to call home.
So, help us God!
Thank you very much.