Article Summary
- Chinwe Egwim elaborates on how Nigeria can position itself like its Asian counterparts to achieve dividends of democracy.
- She also speaks on how underperforming sub-sectors in the country achieve a turnaround for the economy’s growth.
- For instance, she spoke about Agriculture and Oil & Gas, which posted contractions in the first quarter of this year but are seen as under-performing but they remain critical to boosting overall economic growth
At the recently held Nairametrics Q2 Economic Outlook webinar, Chinwe Egwim, who is the Chief Economist and Head of Economic Research/Intelligence for Coronation merchant bank, shared insight on how Nigeria can position itself like its Asian counterparts to achieve dividends of democracy.
She also spoke on how underperforming sub-sectors in the country achieve a turnaround for the growth of the economy.
Dividends of democracy within the Nigerian context about how the IMF and World Bank advocate the “Tailwinds for Democratic Dividends”
Chinwe Egwim noted that Nigeria has a large working-age population relative to the dependents (children and the elderly). She stated further that it can lead to increased productivity, labour supply, and savings which all positively impact economic growth and development.
She cited the labour force data which indicates that about 116 million Nigerians were within the labour force age bracket two to three years ago. But over half of the working population is unemployed, about 33%.
According to her, therefore,
- “To enjoy the benefits of demographic dividends, a multi-faceted approach that addresses specific challenges and assists with untapping the hidden opportunities within the country is essential. The government should prioritize investment in human capital development through education and skills acquisition programs”
- “This will support the country’s medium to long-term development plan by investing in and strengthening the education system at all levels. The blue-collar industry is also very important but has been heavily neglected in Nigeria”
They highlighted the following which needs to be put in place:
- Vocational training should be placed on the front burner.
- Aligning curriculum in the schools with the current economic realities is as important as well as youth empowerment initiatives.
- Job creation focuses on sectors with high labour capacity or sectors that have demonstrated high employment multiplier effects, such as manufacturing, construction, trade, and agriculture.
Effects created by the ‘Japa’ trend in the corporate sector and economy
She started that the current economic conditions have heightened the ‘Japa’ trend which is opening up growth opportunities.
She highlighted the following points:
- Corporate roles are vacant caused of those relocating.
- Relocation of key professionals in the healthcare industry, technology, and education, financial services.
- Agriculture underperforming due to a reduction in the number of professionals with technical know-how.
- Increased cost for businesses to hire new staff or train staff
- Employees are expected to quickly take up roles created by those who exited
- Increased risk of operational errors from employees who recently filled in for employees who exited
How underperforming sub-sectors can grow to achieve a turnaround for the economy
She highlighted some underperforming sub-sectors in the economy which has growth potential and looks forward to policies that will unlock the potential within these sectors. Oil & Gas and Agriculture we’re highlighted as priority sectors.
Here are the sub-sectors mentioned and the interventions which need to take place:
- Crop production which is a sub-sector of Agriculture and has accounted for over 90% of that sector for a while. It, therefore, has the potential for a turnaround
- Manufacturing has sub-sector such as food & beverages, cement, and even fashion, which are very important sub-sectors
- For the Oil & Gas sector, interventions see needed to improve security to tackle oil theft and vandalism while promoting local content development and capabilities within the sector
- For Agriculture, tackling insecurity in food-producing areas is of utmost importance
Speaking of agriculture further, she spoke on interventions that the new administration can introduce to create an enabling environment that supports agricultural development.
- Rural infrastructure needs to be enhanced, which includes transport networks, irrigation systems, storage facilities, and market access
- Critical infrastructure investment in transportation networks, pipelines, refineries, and storage facilities would ensure efficient production, transportation, and distribution
- Improving access to finance and facilitating access to information and extension services would enable farmers to make informed decisions and improve productivity
- Introducing land tenure systems or reforms, well-targeted and properly monitored interventions
- Encouraging incentives for increased private sector investment.
- Promoting gender equality and empowering female farmers through targeted interventions
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