How to Reinvent Nigeria’s Economy through Equitable Regulation

Getting Nigeria acknowledged worldwide as the largest economy in Africa might not have put any food on the table for ordinary Nigerians, but its numerous benefits abound. For one, it can help attract foreign direct investments. The rationale appears to be that investors are looking to invest for profit, so those who had not invested in Nigeria earlier would have taken a look at the issues being raised and ask: ‘If others are delving there and making good returns on investments, what is holding us back?’

This might have been among the factors that informed the entry of Philip Morris International into the Nigerian market in 2015. Convinced by reality as against perception, the company met all regulatory requirements and obtained all import approvals to deepen business not just in Nigeria but in West Africa. The ECOWAS Trade Liberalisation Scheme (ETLS) helps facilitate trade among member states and PMI having a factory in Senegal, took advantage of this.

It is noteworthy that several governments before the President Muhammadu Buhari administration considered diversification of the economy, but none has had so much urgency as the present government. The resolve might have been fuelled by the recession arising from dwindling oil prices. Probably motivated by the drive of the present day government and the desire to impact more on the Nigerian market, PMI, who trades in Nigeria as PMINTL Nigeria Limited, is poised to give a boost to Government’s efforts by looking beyond taking advantage of the ETLS by moving to local manufacturing. This strategic step would impact the economy in several ways, including increased tax revenue for Nigeria, as well as employment for locals through direct and indirect means.

While some will argue that government need not have waited for dwindling oil fortunes to explore other avenues to strengthen the nation’s economy, it is more of a case of necessity being the mother of invention. Previous administrations made efforts in this direction, though, especially when the efforts of the likes of the former Minister of Agriculture, Dr. Akinwumi A. Adesina, and his commitment towards Agriculture are factored into reasoning. These results of foreign direct investment inflows from the likes of PMI are heart-warming, because, statistics from Nigeria’s National Bureau of Statistics (NBS), as quoted by Ventures Africa, recently shows the trend of economic development in Nigeria and her future not so bright. According to a report titled; Nigerian Economy: Past, Present and Future, Nigeria’s Gross Domestic Product (GDP) growth will be 5.61 percent in 2019 unlike when it was 6.22 percent in 2014. This once again indicates a need for an urgent need for diversification. This is the sad reality and many Nigerians know it.

While the battle against corruption rages, we need to revive the economy. I am a strong proponent against the menace eating-up our collective resources, but at the same time I insist we should direct attention towards creating jobs, increasing revenue for the country and building our economic capacity as a whole. The Government of the day has a duty to come up with policies that encourage enterprise, particularly in areas other than oil. There is one staring us in the face, and it appears the government is so beset with corruption issues that it has failed to look towards it.

This is where President Buhari may have to learn from former President, Chief Olusegun Obasanjo. It was the threat of economic bleakness that made him literally beg the British American Tobacco to invest in Nigeria. Pragmatism is what the situation demands. The tobacco industry is a monopoly at this time, and I am sure Nigeria can benefit from more of such investment. Extreme focus on how to shore-up government revenue has seen the Buhari administration impose taxes on current account transactions at the risk of turning the people against their leaders, one must point out. The imposition of a tax of fifty kobo for every thousand naira withdrawn on current accounts is outrageous. This, to my mind, can discourage the banking culture that several governments expended much time and resources trying to inculcate in citizens. The cashless policy that the Central Bank of Nigeria has been championing is also at risk. Our government ought to know better!

My opinion is that, instead of laying more burden on the people, who are already burdened by the ripple effect of the dwindling oil prices, with the risk of distancing itself from voters, the APC administration ought to be wise enough to explore and build on some of the laudable steps of the immediate past administrations. For instance, it can take advantage of Adesina’s giant strides in agriculture.

One of the last duties of former President Jonathan was signing into law, the Nigerian Tobacco Control Act. What is the present administration doing to realize the benefits? I believe that all stakeholders would benefit from a strategic implementation of the tobacco control law. Tobacco will continue to be a part of Nigerian society for the foreseeable future and it is in the best interest of all stakeholders to regulate it and enforce the laws fairly and adequately.

It is only logical that more efforts should be made to regulate every legal, potentially profitable product with a view to boosting the economy. That way, the government can earn income in the form of taxes, levies, duties, etc., to help tackle numerous societal needs, while also discouraging consumption and promoting reduced risk products.

–Sopuru Uwadiegwu, an analyst writes from Surulere