The mirage of Africa’s biggest economy

PENULTIMATE week, Nigeria displaced South Africa as Africa’s biggest economy. Bloomberg, in its report, noted that “Nigeria’s economic growth beat forecasts in the fourth quarter, helping its economy to expand the most in four years in 2019 as oil output increased and the central bank took steps to boost credit growth.” However, the real factor responsible for the displacement was the slide in South Africa’s economy as the country experienced its second recession in two years as a consequence of its contraction, which was more than the projection for the fourth quarter.

While being the biggest continental economy is a big deal, it is of little or no essence unless it makes positive impact on the lives of the citizens. Given the level of hardship, deprivation and poverty in the country, it is our considered opinion that the growth recorded by the economy does not call for any form of chest-thumping or backslapping. Rather, it should serve as a fillip for the country’s leaders and economic managers to think out of the box and grow the economy in such a way that the life of the average Nigerian would be improved and the country would become the envy of other African countries.

At $352 billion, South Africa’s Gross Domestic Product (GDP) has more impact than Nigeria’s $402 billion because of the difference in population. With Nigeria’s population being above 200 million while that of South Africa is about 59 million, Nigeria’s economy should be at least three times the size of South Africa’s to give some sense of comfort. With anything short of that, South Africans will be better off than Nigerians despite their economy going into recession.

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The GDP is a measurement of an economy’s productivity. Over the years, Nigeria’s productive capacity has been clipped due to the legendary appetite of government functionaries and agencies for imported items. Nearly everything in all government offices is imported. Taking a cue from their leaders, Nigerians import everything from food to clothing and drugs. According to the National Agency for Food Drugs Administration and Control (NAFDAC) Director-General, Professor Mojisola Adeyeye, 70 per cent of the pharmaceutical drugs consumed in the country are imported. The import-dependence proclivity of the country has rendered the manufacturing sector docile and enfeebled the real sector. Nigeria’s low productivity reputation has cost it respect among other countries. This is the major reason behind its exclusion from the Brazil, Russia, India and China (BRIC) group, a cluster of developing countries on their way to becoming developed, while South Africa was offered membership, thus transforming the group to BRICS.

So, to properly earn the sobriquet of Africa’s biggest economy, improve the lot of the majority of Nigerians and attract the respect of the world, the productive capacity of the economy has to be increased and the sleepy manufacturing sector energised. This cannot happen unless the power generation challenge is effectively dealt with. Despite the humongous resources committed to electricity, power supply in Nigeria is still grossly inadequate. For a population of over 200 million people, Nigeria cannot boast of 10,000mw. This is one of the reasons industrialisation has been difficult, poverty is rising, unemployment is escalating and development has been more of a mirage.

Until strong measures are put in place to shore up productivity, Nigeria will keep counting on the misfortune of other countries to buoy its continental rating.

 

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