The future belongs to the things that can grow, whether it is a tree or democracy. Gone are the days when the Government’s view of the economy short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.
Industrialization has always constituted a major objective of development strategy and government policy. Through industrialization, developing nations aspire to achieve higher economic growth, and to eventually attain developed nation status. Yet, it remains doubtful whether the approach of industrial policy-making in developing countries has indeed been successful in transforming their economies. In support of private sector-led industrial development, this paper argues for a primary focus on innovation-driven industrial policy to foster skills upgrading, enhance industrial growth and produce world- class exports, with lessons drawn from the experience of developed countries.
It explains why industrial policy-making must address the pursuit of innovation as a prime mover in economic development to put in perspective the importance of innovation-driven industry policy. To provide evolutionary perspectives of Nigeria’s industrialization process since independence from 1960s to 1990s, it analyses the industrial policy thinking behind the different stages of industrialization that has helped build the nation to its current state of economic development. It also describes the new wave of Nigeria’s industrialization in support of innovation, as articulated in its Innovation Manifesto.
The policy of this country on building an independent national economy should include the establishment of many-sided economic structure, the buildup of its own independent and solid bases for raw materials, the modernization of all the sectors of the national economy and the training of its own technical carders.
In the past the government has maintained the principle of producing and exporting products abundant in the country, demanded and competitive in the international market relying on the development of production industry with the oil-exploration industry as the core, light industry and agriculture in conformity with the actual conditions of the country.
At present the foundation of the independent national economy has been strengthened here in Nigeria.The Labour union set forth the economic policy in the post-colonial era on giving precedence to the development of the defense industry while developing the light industry and agriculture simultaneously so as to develop the national economy on its own firm track. The foundation of the oil industry has been consolidated.
The production bases of coal, oil and petrochemical materials industries, are turning out fireproof materials like magnesia clinker and light-burned magnesia, nonferrous metals including lead, zinc and cadmium and various second-stage metal products such as rolled steel, steel plate and wire, which are in great demand on the international market.
The foundation of machine-building and electronic industries requires modernization and the production potential largely increased on the basis of ultramodern scientific and technological achievements.
The Ajaokuta Steel Complex, the Nigerian Metal Complex, the Nigerian Machine Tool Factory, the Defence Industry Corporation Factory, the Nigerdock ship-Making Complex and other big-name factories have laid the solid production foundations and renovated the production processes to manufacture and export hydraulic and thermal power turbines and generators with a great capacity and high performance, compressors, CNC universal lathes, hydraulic excavators, motors and transformers.
Nearly forty-eight years of our nationhood; a day we may all cherish as a nation. Now is the time to look calmly at ourselves and identify the mistakes that we have made as nation. Of course we have in one way or the other made mistakes. Like what Confucius once said, it does not matter the number of times we fall but the number of times we rise when we fall. We cannot continue to fail the next generation.
There is no denying that millions of Nigerian jobs have been lost to outsourcing. It is a fact, yet it tells only half the story. Instead of turning back the clock to late 20th-century Nigeria, we need to fix what’s broken by preparing students and workers to succeed in a global, digital economic era. We do that by revitalizing school curricula with a more futuristic and global bent. We do that by creating a more equitable and effective national workforce training and retraining effort. The bottom line: Education and retraining must move up on Nigeria’s priority list—with the public, academic, non-profit and business sectors all working together.
Such long awaited by some and a nasty surprise to others, the conflict between the industrial age and the virtual age is now being fought in earnest, thanks to that modestly conceived but paradigm-shattering thing called economic reforms. What’s happening with global, peer-to-peer networking is not altogether different from what happened when the Nigerian colonists realized they were poorly served by the British Crown: The colonists were obliged to cast off that power and develop an economy better suited to their new environment.
Industrial policy has been characterized by a primary emphasis on attaining the desired macro-economic environment for industrial development, and at the same time, achieving the intended economic performance for a country. For more than four decades, the rapid growth of Asia’s tigers: Hong Kong SAR, Singapore, South Korea and Taiwan, which pursued government-initiated industrial policy, gave rise to optimism that industrial policy-making, if executed correctly, could be a major contribution to economic growth . Nigeria government is yet to demonstrate strong tendencies of refraining to play the role of a “central actor”, but rather that of a “facilitator” – which stems from the view that industrial development basically originates from societal demands and should thus be derived from the society rather than the state.
While politicians, industrialists and businessmen share the opinion that industrial policy-making may bolster economic development, it is also recognized that industrial policy, if implemented to “cut off” competition, may be counter-productive. The existence of government’s industrial policy instruments– subsidies for failing businesses may be inefficient and it was felt that with government subsidies, comes state control, which is repeatedly found to be detrimental to the market efficiency of business transactions. Indeed, past solutions centred on fiscal incentives that help industries improve the costs of production and factors of efficiency in the creation of goods and services have also become less effective .As many would advocate, one of the virtues of a free-market economy is that it reward.
Economic problems create social problems. Unemployment and inflation especially have political and social repercussions. The unemployment rate is the percentage of Nigerians actively seeking employment but unable to find work. Inflation is the rise in prices for consumer goods. The consumer price index (CPI) measures the change in the cost of buying a fixed basket of goods and services. Many economists and politicians believe that methods for calculating the CPI need to be revised in order to avoid overestimating inflation. Few things are more worrisome to consumers and politicians alike than the combined effects of inflation and unemployment marching upward together.
Already, much of the world—especially Asia—is busy liberalizing trade practices to fuel economic growth, and creating top-tier jobs to ensure ongoing success. They’re preparing for the next decade, when 1 billion new global consumers will reach middle-class standing.Tapping into the tremendous export opportunities that exist for Nigerian companies will require a workforce that is geared to think and act with a global perspective. There’s a lot of promise for a millennial generation of Nigerians who are willing to do what we have always been the best in the world in doing—adapting, learning and competing.
Economic development must be done step by step. It should begin with the strengthening of our economic foundation, by assuring that the majority of our population has enough to live on. … Once reasonable progress has been achieved, we should then embark on the next steps, by pursuing more advanced levels of economic development. Here, if one focuses only on rapid economic expansion without making sure that such plan is appropriate for our people and the condition of our country, it will inevitably result in various imbalances and eventually end up as failure or crisis as found in other countries.
The state must absolutely prioritize sustainable employment creation, which combines economic development with an expansion in decent work. Moreover, the state must have structures that can drive development through a combination of discipline and resorting for capital. At the same time, it must ensure broad participation in policy development, especially by organizations representing working people.
Our Fiscal policy must become more expansionary. Interest and foreign-exchange rates must be designed to support increased investment and growth in exports. In particular, targets for the Central Bank should include the current employment and growth targets. That generally requires a reduction in real interest rates to levels comparable or lower than Nigeria’s main trading partners.
Our monetary policy manipulates the supply of money and credit in private hands. Monetarism holds that the supply of money is the key to the nation’s economic health. The main agency for making monetary policy is “CBN,” whose formal title is the Board of Governors of the Central Bank Of Nigeria. The CBN uses three instruments to control the money supply. First, they set discount rates for the money that banks borrow from the Central Bank. Second, they set reserve requirements that determine the amount of money that banks must keep in reserve at all times. Third, they buy and sell government securities in the market, thereby expanding or contracting the money supply. The amount of money available, interest rates, inflation, and the availability of jobs are all affected by the CBN. Presidents try to persuade the CBN to pursue policies in line with the presidential agenda.
The fact that the previous generation slept through the world of change like Rip Van Winkle does not mean that we too must also fail posterity. India, Singapore, Taiwan, South Korea and the rest of the Asian Tigers have been able to use less than two generation to propel their economies from the quicksand of aid dependency to the solid rock of economic independent.
Today all over the world we talk about Asia as the centre of international commerce. It must interest us to note that we all inherited the same economic condition after independence. The difference is that whilst we in Nigeria were seriously engaged in military adventurism in our national politics our contemporaries in Asia were busily embarking on good governance; whilst we as nation were only consuming finished products from Europe and America they were manufacturing their own.
If Nigeria is poised to take its rightful place in God’s universe, then are some certain things that we should that will grant us all safe passage into the city of self actualization. Many years ago a great philosopher by the name John Stuart Mills said when society requires to be rebuilt there is no use in attempting to rebuild it on the old plan. The rebuilding of our nation cannot be carried on the wheels of military adventurism, poor attitude toward work, corruption, ethnic and tribal tensions and unhealthy political rivalry. The solution to our national problem is within our reach. No prodigious thunderbolt from heaven will blast away corruption and economic decline and increase our foreign exchange reserves and shoot per capita income to say $ 4000. Again and again God will not send marching armies of angels from heaven to lift us from this present stage.
We the people of Nigeria must commit ourselves to the desired change. National goal of economic prosperity and Nigeria becoming the gateway of West Africa will not roll on the wheels of inevitability. For less than forty years Asian countries like Japan, Thailand, Indonesia, Singapore and Malaysia have been able to move their economies clutches of aid dependency.
Taking this way, very soon Nigerians will not be asking our politicians, if the slogans do reflect in the pockets. To me the slogans are not vision or mission statements, since those of the later require a lot of work and commitment to arrive at one.
I wish to conclude that, governance, not to even venture into the demands of good governance, is a serious business. So it is time all politicians live up to the demands of basic governance. Administering this country and managing the economy towards a pro-poor development is a challenging task to meet. The performance indicators on Nigeria are grossly in red and they have found it fashionable just to play around with slogans. The situation under which the government continues to think it is in an advertising business and not in governance to administer has is leading to despair among majority of Nigerians
Fiscal policy describes the impact of the federal budget on the economy. Keynesian economic theory envisions and activist government with a large scope. This has been the dominant economic philosophy in Nigeria since the Independence. According to Keynesian theory the government’s job is to increase the demand when necessary and the supply would take care of itself. President Umaru Yar’Adua believes that the key task for government economic policy is to stimulate the supply of goods, not their demand. Supply-side economics Continued from page 17
Supply-side economics argues that big government soaked up too much of the gross domestic product by taxing too heavily, spending too freely, and regulating too tightly, government curtailed economic growth. Supply-siders believed that cutting taxes would pull business out of its doldrums.
Controlling unemployment and inflation with precision is very difficult. It is difficult to implement programs since most policies must be decided upon a year or more before they will have their full impact on the economy. A major restraint on government’s ability to control the economy is the fact that the private sector is much larger than the public sector and dominates the economy. The budgetary process, because of the fact that much of the budget is uncontrollable, also hinders fiscal policy.
Nigeria’s business environment has long stood at the center of the country’s economy. Some multinational corporations, businesses with vast holdings in many countries, have annual budgets exceeding that of many foreign governments. Since the early 1990s, billions have been spent by conglomerates buying out other companies. Competition in today’s economy is often about which corporations control access to, and profits from, the new economy. In the old and new economy, Nigerians have always been suspicious of concentrated power. In both the old and new economy, government policy has tried to control excess power in the corporate world. Antitrust policy is designed to ensure competition, prevent monopoly and, prevent restraints on trade. Antitrust suits are more often threatened than carried out. In a few cases government loans or buyouts have made government an actual partner or owner in corporate Nigeria. The Federal Ministry of Commerce And Industry serves as a veritable storehouse of assistance for business.
Several years ago public policy ignored consumers and their interests. Today, the National Agency for Food/ Drug Administration and Control (NAFDAC) has broad regulatory powers over the manufacturing, contents, marketing, and labeling of food and drugs although funding cuts have left it overburdened and understaffed. The Nigeria Standard Organization, traditionally responsible for regulating trade practices, became involved in consumer protection as a defender of consumer interests in truth in advertising.The scientific and technical foundations in the electronic industry have reached the high standard.
The groundwork for production and technical forces are provided to turn out hi-tech electronic products like computers, semiconductor elements with a great output and IC together with the development of various programs. The production potential in the light and fishing industries and agriculture has also increased a lot. Textile and spinning mills, silk mills, garment factories, shoe factories, daily necessities factories and foodstuffs processing factories are furnished with latest production facilities and their products are satisfying the domestic and external demands in both quality and quantity. The fishing industry has laid a firm foundation as well in conformity with the geographical conditions of our country that has many rivers and is sea-bound on three sides. Material and technical foundations of the land and marine transport sector were consolidated. The production and repair bases of electric locomotives and large cargo ships were set up to meet the growing demand of the national economy for tranport. With an active participation of cargo ships into the international chartering market, the volume of cargo transport is on the systematic increase.
In the agricultural sector, projects for universal land realignment and grand gravity-fed waterway would be carried out to lay basis for the radical incease of grain output and agricultural produce-processing bases such as the latest potato starch factory went on line. Thanks to this country’s public health policy, the traditional medicine production centers were established in the health sector. The development of the medicine and the increase in its output have not only contributed to the health promotion of the people but brought about the boost in its export.
The sound basis of the independent national economy laid in Nigeria is the material guarantee for the further development of foreign trade on the principles of independence and equality. Finished goods are taking a considerable share in export while a favourable climate for investment including the production of competitive goods based on the hi-tech, and joint venture has been radically improved. This government should continue to consolidate the foundation of the national economy, which firmly ensures the development of foreign trade, strictly adhering to the line of economic development in the post-colonial era.
Perhaps the biggest change in economic policymaking has been the about-face turn in public policy toward labor unions over the past century. The major turnabout in policy toward labour took place during the National Development Plan era. Certain regulating Acts guaranteed workers the right of collective bargaining. It continued to guarantee unions the right of collective bargaining, but also prohibited unfair practices by unions. One section of the law allows states to adopt right-to-work laws that forbid labour contracts from requiring workers to join unions to hold their jobs. Partly as a result of successful union lobbying, the government needs to provide unemployment compensation and guarantees a minimum wage.
The last few decades have seen a shift in focus from the old industrial economy to a new information economy. Three million Nigerians work in technology-producing industries abroad. Access to technology is uneven. The old economy generated issues of income inequality, but the new economy involves issues of information equality. The racial and ethnic gaps in information access are widening.
This time, through the ballot box, Nigerians essentially decided to give up certain economic freedoms for the good of society as a whole. The decentralized Nigeria political system often works against efficiency in government. One of the consequences of democracy for economic policymaking is that it is difficult to make decisions that hurt particular groups or that involves short-term pain for long-term gain.
Different opinion disagrees most about the scope of government involvement in the economy. Some favours an expanded role of government in stimulating the economy during times of integral development. Some people argue against government intervention, whereas few people focus on the imperfections of the market and what government can do about them, majority focus on the imperfections of government.
We are now faced with the fact that tomorrow is today. We are confronted with the fierce urgency of now. Procrastination is still the thief of time. Life often leaves us sometime bare, naked and dejected with a lost opportunity. The tide in the affairs of men does not remain at the flood; it ebbs. We may cry desperately for time to pause in her passage, but time is deaf to every plea and rushes on. There is an invisible book that faithfully records our vigilance or neglect. The good thing is that it is not too late for us.
At forty-seven we can start over with new attitude towards building the nation. The paraphrase words of former U.S President John Fitzgerald Kennedy still remains us strong that: we should not ask what Nigeria can do for us but what we can do to make Nigeria move forward, at this period of nationhood transformation . It must start from you and me. We must change for the better and make this nation the true “giant” that Ahmadu Bello, Nnamdi Azikiwe and Obafemi Awolowo dreamt about.May God bless Nigeria and make it greater and stronger once more!