We cannot continue to deceive ourselves as a nation and expect to make meaningful progress. This century is driven by the digital economy and knowledge industry. These two indexes are mass based. Countries that invest their annual budgets massively on education and vocational training would naturally take advantage of this digital-based economy. For example, South Korea, which was ranked as an underdeveloped economy along with Nigeria in the 1960s, today is the 5th largest economy in the world. The reason is not far-fetched; it made a conscious effort to invest massively in education and vocational training. To match words with action, that country invests roughly 60 per cent of her annual budget in these two areas. This is a country that does not have any known substantial raw materials. It chose to invest in the human capacity of the citizenry. What do we have in Nigeria? Our dear country has proposed to invest only three per cent of its annual budget in education when about 60 million Nigerians cannot read and write. Let us imagine how these millions of Nigerians would transform Nigeria if they have access to qualitative education and vocational training. Looking at this scenario, would you say we are prepared for diversification? We must begin to do things differently if we are serious about diversification.
•Prof. Tunde Fatunde (Senior Lecturer, Lagos State University, Ojo)
It doesn’t show from this budget that we are really serious about diversifying the economy away from oil. We have yet to see major investments in agriculture and agro-allied industries that will help us diversify. There is no major initiative in tourism, there is no major initiative in solid mineral development, and we have not seen investments in these items that will give us comfort that we are committed to diversification. All the assumptions are based on reliance on oil revenues.
From the point of view of diversification, I don’t see something that calls for cheer. The good news, however, is that the capital expenditure component has been increased to 30 per cent on the average which is some improvement from what it used to be. It used to be 18 per cent and 20 per cent when we are lucky, but now it has reached 30 per cent which is good and should give us some hope. But we are still far from where we should be. This is because in China, Bolivia, Malaysia, Thailand and Singapore, the reverse is the case. Capital expenditure is 70 per cent while recurrent expenditure is 30 per cent. Only a fool spends his entire income on just feeding with nothing left to plan for tomorrow.
We need to work harder and think smarter on these issues. Even the much talked about Economic Recovery and Growth Plan, this budget doesn’t really make much reference to it. With the budget just coming now, we would have expected reflections on the ERGP. Finally, it is looking as if our National Assembly can take the budget and rewrite it to fit their whims and caprices; it is very wrong. Our constitution is defective in the sense that they can literally get unlimited powers to rewrite the budget. The only proviso is that whatever they bring is financeable and once it is financeable, they can overrule the President. In civilised democracies, this does not happen. In the classic division of power, it is the Executive which wears the shoes that knows where it pinches. The role of the Parliament is to look at it and raise issues where there make amendments. •Dr Obed Mailafia (Economist/ex-Deputy Governor, Central Bank of Nigeria)
The fact that what we are investing in infrastructure in 2017 is less than what we invested in 2016 shows that the budget is actually not expansion, not pro-investment and not pro-growth. Forget about the figures in naira, you have to calculate the figures in dollars because most of the goods we import in terms of infrastructure investments are calculated in dollars, not in naira. So, Nigeria has to come up with a comprehensive master plan on how to regulate infrastructure investments because it is only by developing our infrastructure that our businesses will be globally competitive, and that is the only way by which the nation can truly begin to grow and diversify away from this mono-economy which our dependence on oil revenues represents.
It requires that we sit down in this country, brainstorm and agree on how to solve this problem. You can borrow money, but you don’t just go and borrow without a comprehensive master plan on how you intend to invest it and get return on that investment. Which critical infrastructure do you intend to invest in to develop the economy? There are companies who have $1tn in foreign reserve, we must look critically at the things we must do to reverse the situation we are faced with today because our population is growing. •Mr. Odilim Enwegbara (Abuja-based development economist)
The 2017 budget was anchored on pulling the economy out of recession and stagflation as well as taking the path of self-sustainable growth. What is important is not the budgetary amount set aside for funding support to agriculture which is not enough for a N100tn economy that seeks to diversify away from import dependency, but rather policy articulations that seeks to support public private partnership as well as direct private investment in agriculture and agro allied industries.
We need to focus on policies that support backward and forward integration and seek to make agriculture a business rather than just for self sufficiency.
Recapitalising Bank of Agriculture as well as $1.3bn anticipated off-shore investment to support the proposed Development Bank of Nigeria are areas that need to be fast tracked in 2017 to ensure that single digit interest rate funding to agriculture and agro allied businesses become a reality, thereby supporting Gross Domestic Product growth rate, reducing foreign exchange pressure for imports as well as minimising the impact of imported food inflation in our economy.
The National Bureau of Statistics data have shown that contribution of agriculture to nominal GDP for example, has grown higher than it was. This is positive and assuring as there is now ownership. This, however, needs to be complemented by walking the talk in ensuring the 2017 budget fiscal stimulus is implemented as much as possible.
Nigeria has huge economic potential outside oil sector which is largely untapped due to the so called Dutch Disease that has, for years, made us lazy and always relying on a mono commodity called oil as a source of income, notwithstanding the fact that oil constitutes only 10 per cent of our Gross Domestic product.
There is potential for growth in non-oil export in most states and virtually all the states have one form of economic competitive advantage or the other.
For example, virtually the whole of Zamfara State is sitting on gold and diamond largely untapped with little going to illegal miners. The current economic reality is a good opportunity for us to diversify. •Mr. Rislanudeen Mohammed (Lead Fellow, Institute of Fiscal Studies of Nigeria and Managing Director, Safmur Investments Limited)
The 2017 budget is a fiscal rhetoric; it is the same circle that Nigeria has been in for some years now. So, I don’t think it is a strategic roadmap for redemption from the quagmire that we have found ourselves as a country.
Even the agriculture the government is talking about, we are aware that farmers, these days, are being kidnapped. In the area of diversification, insecurity is a problem because we have people, who have interest in agriculture, but they cannot go to farm as a result of insecurity. I think that the people that are running government are totally disconnected from the reality on the ground. •Dr Georgewill Anthony (Executive Director, Niger Delta Budget Monitoring Group)