Not long after we had wished ourselves happy and prosperous 2020 that news started filtering in of the outbreak of SARS-virus in China. As the days go by, so the number of people continue to rise until WHO named the disease COVID-19 and declared it as a global pandemic (I am still going to find out how it differs from epidemic). Gradually the virus was slipping through borders; and countries continue to lockdown. For Nigeria, if our leaders had taken the precautionary steps of stopping entries from countries already having significant percentage of infections, like France and Britain, perhaps we would have been able to fight the virus as was done for Ebola. With moments of indecision passing by, suddenly COVID-19 was imported from Europe and landed in Ogun State on February 29, 2020. Again, as if the government was not yet sure of what to do, days passed by until a national lockdown was ordered on March 29, 2020. The COVID-19 pandemic has brought to fore the sorry state of our health facilities and institutions and the need for a new thinking on managing our health facilities.
Meanwhile, Academic Staff Union of Universities (ASUU) had declared a two-weeks warning in March and the strike became full-force on 20 March, 2020. Well, with the lockdown in place, the impact of the strike was not evident at the national level but the stakeholders at the community level (traders, landlords, food sellers, provision stores, transporters, etc.) started feeling the pinch of the strike almost immediately needless to say that the strike has battered the economy of the universities’ communities and stakeholders, which, population can be anything but up to 20 million. Part of the fact that poverty is growing rapidly in Nigeria.
As this was going on, then came crashing the crude price, the mainstay of Nigeria’s economy, therefore, government source of revenues was threatened. Then government introduced the monthly pricing regime for refined petroleum products. Expectedly, the level of inflation started rising, the national currency was devalued to ensure that government realises adequate revenue to discharge her responsibility which made the exchange rate to skyrocket. With all these stressors, prices of food and other commodities continue to rise which eventually made the economy to slip into recession in the third quarter; the second in five years.
Banditry, kidnappings, terrorism, armed robberies and emerging forms violent crimes are on the increase as you would expect with rising inequality and poverty accentuated with hunger and starvation, poor infrastructure, rising youth unemployment, unprecedented population rises etc.
Even without being fully assured that the COVID-19 infections had been brought under control, government introduced the phased relaxation of the lockdown as from May 4, 2020 because of pressures arising from desperation, rising inequality and poverty as well as cases of rape and other domestic crimes. But the ASUU strike was not a priority of the government during the lockdown and the government only turned towards the strike when the citizens started expressing concern over the long closure of almost all public universities in Nigeria since March 2020. The strike was just suspended some few days ago (December 23, 2020) giving rise to the longest ASUU strike in recent times. Then came the ENDSARS riots which again turned Nigeria to the other side, with the apparent neglect of the citizens as far as the sharing and distribution of palliatives for the COVID-19 was concerned. Nigeria witnessed an unprecedented fury and anger of the youth which led to widespread destruction and more …
On the side of my profession, AGRICULTURE, there was unprecedented flood that destroyed more than 35% of farmlands, some at the point of harvest. In addition, rains were barely enough to give bumper harvest that could prevent hunger and starvation. The low irrigation-to-rainfed agriculture in Nigeria is a substantial source of risk which cannot be borne by small scale farmers. It is said that Nigeria is the highest producer of rice in Africa, and if so, why is the price of rice so vulnerable to every shock to the economy? The price of fertiliser continues to soar such that farmers are unable to apply the optimum rates that would ensure profitable agribusiness. Lands are being over used, labour over applied, inputs under-utilised. This is the reality that needs urgent attention of government. Investment in technology generation, investment in technology import rather than technology consumptive importation, investment in education rather than in imported but unapplicable technologies is what Nigeria needs and that is what I advocate.
Then came the second wave of COVID-19 infections which seems to be spreading faster that the first wave. For example, during the first wave, Nigeria recorded 12,559 COVID infections in 100 days but in the second wave, Nigeria recorded 12,297 infections in just 20 days, see more here. What is most worrisome is the lackadaisical attitude of most Nigerians to safety protocols as many tend to believe either that the whole thing is a farce or they place their confidence in the higher being so no need to take preventive measures. Based on the latest data and the ensemble forecasts, if the trend continues unabated, the COVID-19 cases would continue to spread in Nigeria and the cumulative cases as at October 18, 2021 would be 652201 from the polynomial without Knots, 2578877 from polynomial with Knots, 1613968 from smooth spline, 89257 from lower ARIMA, 538730 from upper ARIMA and -51416 from higher Polynomial. Since 81052 cases have already being recorded as at December 23, 2020, therefore we expect the balance of the forecast to be recorded between December 24,2020 and October 18, 2021.
Clearly, some of the activities and actions of the government acted as stressors rather being a curative measure. For example, the monthly pricing of petroleum products has the capacity to cause distortion to the economy because Nigeria’s economy adjusts slowly to changes, as such, the economy had hardly adjusted fully to the prior price changes when a new one is announced. It is my considered opinion that the pricing system should be market-regulated and market-driven as there won’t be any need to specially announce the price monthly as had been done in the few months. I mean, when Nigerians go to the market and finds price changes, they react by adjusting their budgets without a fight but when government is involved in price-fixing, there must be a fight. For example, the price of cement has rising from about 2450 to 4500 in the last few days and it has not made a news but if government announces the price adjustment, there must be a fight.
One of my candid opinion is that government needs a crack economic team. The present crop of economic team seems to be only interested in collecting more revenues for shares but the real economic management issues are left. Otherwise, why raise tax and levies (VAT, stamp duty, etc.) on Nigerians in a time that there is clear need of expansionary expenditure. Nigerians purchasing power had been so shrink (high inflation and exchange rate) that most essential goods are no more consumed by the masses. These can have negative effect on the economy and if more is not done, Nigeria may recess into depression. The year 2021 is crucial in economic recovery as if that fails, it may spell done as we expect political activities to pick up from the end of 2021.
Inflation management should also be overhauled as inflation seems to have triggered up to 20% increase in the price of petroleum motor spirit (PMS). On the other hand, PMS seems to have accentuated inflation by 0.038% but it is suggested that the ideal inflation that is suitable and would sustain economic growth in Nigeria should be around 7.1%, which is half of the current rate. Therefore, a reformed economic team would ensure that prices of goods and services are bought to 50% their current rate. For example, the price of cement and PMS which are at the core of the economy should be brought under considerable stability.
Nigeria was indeed stressed in 2020 but those stressors must be removed in 2021 to ensure steady and sustainable economic growth as well as well-planned industrial development so as to attain the 2030 SDGs.
Prof. Job Nmadu
Professor of Agricultural Economics of the Federal University of technology, Minna and the President, Nigerian Association of Agricultural Economists (NAAE)