My lord I am constrained to write to you directly this morning on the frenzied search for oil in the northern basin and the Benue plateau. Sir, with all due respect I will say categorically that this cannot be solution to any of our many challenges. If the reason is to shore up oil receipts or limit our direct exposure to the volatility of the Niger delta I also dare say that it will not work.
Sir, the influence of oil in global economics continue to wane seriously. Other nations are getting very close to achieving other sources of energy which are cheaper and less fraught with the controversies and violence in some cases that comes with oil politics. Today, you will agree with me that the demand for oil is at its lowest and the democratization of the product has also impacted on its value leading to a supply side market with its attendant fall in its prices.
Furthermore, even with an unlikely upsurge in prices, the market dynamics has changed in such a way that we have lost our major buyer and have to struggle with better positioned competitors to fight for an Asian market that is not as deep as what we used to have. So my Lord, as you can see drilling and looking for oil in all the plateaus that make up the Northern part of this country is not a solution any which way you look at it; short or long-term.
I really think this is misplaced priority because the huge resources being expended on this search could have been used to diversify the economy to develop other areas whose potentials are near-sighted and whose dividends the masses can start reaping almost immediately. Look at the entertainment industry and you will me amazed at its full potentials. Already providing employment directly and indirectly to millions of Nigerians, generating billions in investments and revenues and also positioning the country as a bastion of culture.
The Jonathan Government did a lot to support the industry and that is why it is where it is today. A little bit more push on your side especially in the areas of tax rebate for its investors, opening clear lines and access to international markets through the signing of bilateral agreements at your level with strategic markets ensuring protection of copyrights, ease of inflows of revenues from these markets, less taxation, support in the fight against piracy and also emporium our cultural attache’s in strategic embassies out there to push for individual Nollywood Film Festivals in those countries you will be amazed that oil revenues will resort to a pittance. India, China did it. Mexico and Brazil are doing it with their telenovelas.
On a second thought before I jump out of the Benue plateau, if we must continue on this search then it must be private sector driven. We can give the firms as much tax concession they need, security and other waivers so that it becomes a risk for private initiative instead of a government thing, this would also mitigate the rise of nationalistic tendencies like the Niger Delta in the event of an oil find.
I really do not want to scream agriculture because I do not want to sound contradictory. I remain in the firm position that Government has no business in business and as such I would not push for full government involvement in this sector despite its full potential. On hindsight, I will support the grazing bill, mid government can assist very serious-minded herds men to constitutionally and legally quite huger tracks of grazing land then we will be better for it. Already the private sector is looking at Agric with the establishment of huge plantations and the rest.
During the Jonathan regime, we achieved self-sufficiency in some farm products due to the revolutionary policies in fertilizer which increased yields and gave rural farmers the every best in life. Today, I do not understand what the situation is. We have the labour force, the climate, huge tracts of land to be coordinated and not only turn us into a food basket but also a major exporter of raw materials or even processed goods,
Today the Chinese to escape the scarcity of forex are exporting our timber and bringing it in as finished woods for our furniture industry. This is the way to go.
Oil is finished and has at best a decade to keep its influence. Other major producers like Saudi Arabia are already looking at other areas, like Gas and other such allied products for o virus reasons. UAE has built an eco my more reliant on tourism and international investments than on oil this is for very obvious reasons.
I simply believe that this search is a journey that will not lead to Uluru but will continue to keep us waiting for Godot and this remains unfair since my lord people are literally dying.
Oga Joe,
You nailed it there. I particularly like your view on tax concessions. The fiscal policies of the government should reflect its overall objective and consider the macroeconomic situation.