Nigeria’s Economy Of Self-interest (2)

by Punch on

Sheriffdeen Tella

  • Continued from Wednesday

The group interest in the power sector is more complex than other sectors of the economy. It starts from the producers of generators abroad and the importers in Nigeria. Nigeria is reputed to hold the first position in the generator-importing business and lot of employment is generated in the countries that manufacture generators while the Nigerian importers laugh to the bank with huge profits. The same group interest with the producers and importers of all sorts of electronic lamps, batteries and lamp holders, as well as, the new inroad into inverter production and importation business. All these are different interest groups with foreign collaborators who are going to lose revenue and cause unemployment in their respective countries protect their interests against the nation. The people in government cannot ban generator importation because they are also directly or indirectly in the business.

I remember a former Minister of Information who was also a major importer of lamps. In fact, he was given or he gave himself the franchise as the sole importer! He would definitely have worked against any policy to ban such items. And, there are people like him in every government. I can imagine a government taking a bold step to ban importation of generators, lamps, batteries and power related items. The government then asks those producers who are interested to move into the country to continue the production of the same items. Nigeria is a big market that foreign entrepreneurs or investors cannot ignore. A number of the producers will come in and engage our youths, thus reducing unemployment. But this is just an imagination or probably, a dream; a wishful thought that cannot come true given the selfish powerful people involved in running the business of Nigeria.

It is also self-interest of milking the economy that drives fuel importation and payment of subsidy. The powerful oil magnates would never allow old refineries to work nor new ones to spring up. There is no rationale for turn-around maintenance of the old refineries with the 1970s technology. Where do they get spare parts for repairs when the rest of the world has moved on? Why would the government not use the fuel subsidy fund to establish modern day refineries, even in partnership with private investors? Why not privatise or sell them to foreign investors who could pair up with regional economic bodies like Odua or the Arewa Group? There are unconfirmed stories that some top Nigerians have shares in or own refineries abroad and are also involved in the importation of refined oil into the country. So, the self-interest of survival of their businesses abroad would naturally make them work against public investments in refineries at home. Until the Dangote Refinery starts operation, one can never bank on a new local refinery in Nigeria in the foreseeable future!

Now, we have another dangerous self-interest group – the cattle owners. The herdsmen are not so rich to have so many cows and even afford AK 47 rifles to run their business. The owners of the cattle, rich, powerful and in control of security apparatus, are the main culprits. They may or may not have farms or ranches but have cows larger than they can manage within their jurisdiction and which are given to the herdsmen. My intuition is that the cattle owners hire armed bandits, as separate groups, who move in to destroy villages and farms before the herdsmen and their cows get onto the location. Normally, the herdsmen are few relative to the herd they manage at any point in time. The presence of the herdsmen amidst the cows is also required to keep the animals in check. If the herdsmen are the ones going into villages and farms to kill and destroy property, the cows will be in disarray before they return. Thus, a separate labour is required– the armed middle men.

In addition however, one or two armed “security” operatives are engaged to follow the herdsmen and these are the ones involved with the herdsmen in small scale crimes on farms and isolated locations.

The wanton destruction presently being carried out across the country can be as a result of the growing population in the rural areas with more areas being covered for habitation and farming reducing grazing areas. Also, as the government and people are now taking agriculture more seriously, the cattle owners found that more land space is being cultivated, reducing the grazing space for their cattle. They are not ready to invest in grazing reserves and thought the best thing to do is to destroy villages and the inhabitants; burn down houses and farms so as to allow grass to grow on the land when the rainy season begins. In their quest to make money, which is founded on self-interest, they have no regard for lives and property. The wider implications of the actions of these nefarious activities are the resultant failure of the government’s agricultural programme as farmers and investors in farming activities would be scared of going into farming.

Of course, the importers of food and finished products will be happier for it. Government must take a bold step to prevent further avoidable annihilation of human lives in villages unless cows have become more valuable than human lives!

No country achieves economic progress through self-interest that recognises and puts premium above national interest. It is often said that capitalism is about self-interest because the producer is out to maximise profits and the consumer is out to maximise satisfaction from products consumed. In the Adam Smith’s “Wealth of Nations”, Smith opined that the aggregate of individual wealth in the society constitute the wealth of the nation. The entrepreneurs or producers are expected to invest and make money, pay their workers as and when due to promote consumption and generate revenue therefrom; re-invest the profits in the economy to generate more output while in the process, create more employment opportunities, as well as, encourage competition through innovations and technological progress.

The Nigerian economic managers more often than not craft unfriendly manufacturing policies that result in high cost of domestic production but promote a largely import-dependent economy where only small proportion of the revenue generated is re-invested in the economy and the larger proportion forms part of the documented growing illicit capital outflows from Nigeria. In the 1970s, Ebenezer Obey produced a song, “Nigeria yi si ma dun o da mi loju” (Sure, Nigeria will soon be better) but this is 21st century and the conditions are still not better. That is why Edris Abdul-Kareem sang, “Nigeria jaga jaga” and Wande Coal asked: “Na like this we go dey dey?”

As long as self-interest overrides national interest in economic activities, or personal interest is allowed to supplant national interests, so long as a group of investors have to arrest or destroy investments of competitors in order to survive, that is how Nigerian economy will continue to suffer.

Concluded

  • Tella is Professor of Economics, Olabisi Onabanjo University, Ago Iwoye

  PUNCH.
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