The Nigerian Economy is a Public Sector depending Economy. Although, termed as a mixed economy, the economy is built on the public sector with the private sector playing a minimum role. Government who is a major player owns greater assets of the National Income, while the citizenry acting as private sectors contribute less. Of course, the system is more defined with the uses of fiscal policy. The origin can be sourced from her colonial master (Britain). The British Economy during the Great Depression adopted the propounded fiscal policy of John M. Keynes of UK as an instrument to redress their economic depression. Latter, the policy became a major economic tool for national income policy and other economic development policy makers. Many countries including Nigeria embarked on its uses. However, the truth is that in today’s economy, there is an existence of both monetary policy (which is propounded by Milton Friedman of USA) and fiscal policy. They interweave in the policy formulation of every economy including that of Nigeria.
Back to the Nigerian case, the public sector operates as the driving force of the economy with the support of the Nigeria Central Bank (CBN) regulating the circulation of the currency via the tool of the monetary policy. The private sector known as a second sector respond indirectly in accordance with the description of the instrumentality of the public policy. Following the abundant human and natural resource endowment of Nigeria , her economy suppose be a top leading economy in Africa, perhaps among the best 20 in the world, that is if the formulated set of policies are well implemented, monitored and evaluated during the developmental process. But failure has been the result in all sectors ranging from the agricultural to industrial sector. The public sector has failed, thus brought a reproach to the effectiveness of the fiscal policy. Now, it is Government (Nigerian Government) failure instead of Market failure, which was a major reason why J.M. Keynes propounded the fiscal policy for the Western economies.
However, many people held neo-colonialism, neo-imperialism and corruption as responsible factors. In the less of corruption, to some extent, the above mentioned factors are not harmful to the Nigerian Social development (that is not my argument). But the truth is hold on a concrete evidence that the socio-political-economic institutions of Nigeria are deformed and have all failed due to self-caused factors.
The Economic institution is mainly characterized with some bottlenecks on its supply-side, thus has made the economy to be productive incapacity. The productive factors such as labour, capital, etc are misallocated and even as been misallocated, they are also mismanaged. The endowed natural resources (less crude oil) are less explored. As the case may be globalization policy is seen as sabotage to the economy, since the economy cannot produce. Failure to produce has turned the economy into a consumption-depending economy. This is why China and other New Industrialising Countries (NICs) especially from the Asian region have turned Nigeria into a dumping place of their various goods.
For the Political institution, instead of a true spirit of capitalism a la Prof. Okowa (former Dean of Social Science Faculty, University of Port Harcourt), Abdulistic Capitalism has taken over as the driving force of the economy. Perhaps, this is the major reason why labour lost its dignity in the economic institution. Those working hard in the manner of the true spirit of capitalism do not get rich and people in politic get richer, thus the few Abdulistic Capitalists (Abdul is a northern legend who believed that; the only way to make money in Nigeria is to be connected in politic) enriched themselves via corruption, dominate and controlled the society. This is why government and anti-graft agencies in Nigeria cannot fight corruption.
Lastly, the Social institution exists with the people having the believe that-it is only the fool that obey the laws. The poor masses subconsciously believed that the law is made only for them. The rich are seen to often buy their innocence in the court when they commit crime, and the poor who cannot afford a police bailout of five thousand naira (#5000.00) are often victimized and arraigned to court in most cases.
However, Nigeria is not the first country to experience this socio-political economic backwardness or upheaval. Many developed countries once in time had similar social condition, which led to their revolution. We cannot forget the French Revolution (1789–1799), the American Revolution (1770-1783), the English Revolution (1640-1660) and others. All hope are not lost, Nigeria can still meet up with the Chinese economy. However, if that to be achieve, the idea of seen her poor economic development as an economic problem (as the failure of other institutions are ignored) must be disdain into a refuse bin. Policies of institution innovation relatively to institutional approach must be adopted. These policies must exist to stimulate changes in her various institutions. They must be goal-getter policies. All hands must be on deck for their implementation, monitoring and evaluation. And finally, the social and opportunity costs of the policies must be accepted by the general public because at the early trend, people will suffer the course, but the long run benefits are sustainable development in brand.
Written By: Nwankwo Stephen,
Click: http://nstephen-profile.blogspot.com
NOTE: Next Article: The two ways to put Nigeria into a developing trend
Posts
