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Planning in Nigeria’s Uncertain Environment By Victor E. Dike
Planning is unarguably a Herculean task, but it becomes much more daunting in an uncertain sociopolitical and economic environment for which Nigeria represents today. The nation’s perennial power problem, combined with other institutional inadequacies, is exerting inflationary pressures on organizations, which are passing the high costs of producing good and services on to the consumers. This article discusses the difficult task of planning in an unstable politico-economy and measures to improve the condition of things for the people to achieve their dreams and aspirations.
Recently, a friend of this writer resident in the United States poured out his frustration on the precarious rising costs of goods and services (and particularly building materials) in Nigeria as he has been struggling to build a hut for his family. He lamented that the price of cement, rod, timber, sand, chip, gravel, water, and other building materials, which changes everyday, has made planning and budgeting irrelevant and has often prolonged the estimated time for the completion of projects. In fact, uncertainty and frustration could lead to abandoning his project if prices of material continue to ratchet upward.
The uncertain environment and price escalation has negatively affected the demand for other goods and services and business activities thereby increasing the nation’s unemployment, inflation and poverty rates and thus her economic “Misery Index”. Misery has, however, been defined as a state of great unhappiness and emotional distress. Inflation and unemployment are the main components of ‘Misery Index’, which is said to have been created by economist Arthur Okun (Kurt Badenhausen -Forbes.com, January.30, 2008). Nigerians are increasingly feeling the pinch of the bad economic condition as there is no assistance from the government to cushion their sufferings.
Like in any other society, the condition of things in Nigeria is defined by the effectiveness of its leadership and social institutions. The main problem with the economy, as it has been emphasized, is the nation’s institutional deficiencies and corruption that lead to high costs of producing goods and services. And this affects household budgets. According the National Bureau of Statistics (NBS), Nigeria's inflation rate rose to 9.7 per cent in May from 8.2 per cent the previous month. Inflation was, however, about 6.6 per cent last December. The agency has also observed that “The composite consumer price index went up by 1.9 per cent to 177.6 points in May 2008 as compared to 174.3 observed in April 2008” (Guardian, June 25, 2008).
Some people could argue that inflation and economic uncertainty is currently a global problem; but the problem with Nigeria is that there are no concerted efforts and effective plans on the ground to tackle the problem. How much longer can the people take this ‘double jeopardy’ of inflation and unemployment?
Because of the sloppy record-keeping habit of the National Bureau of Statistics (NBS), the nation’s unemployment and inflation (misery) figures may have been understated. How would inflation and unemployment figures be determined in a society without a reliable personal identification? And with the large number people in the informal sector of the economy how does the agency determine who is really unemployed? A search for answers has not produced any positive results.
Bad governance and low productivity is, however, dragging the economy down; and this has increased the uncertainty in knowing the amount of resources needed to complete a particular project in the society. Despite its astonishing lapses in judgment and the fact that the society is now bellowing with outrage that it is “too slow”, the present administration is not doing anything serious to improve the supply side of the economy.
There were unlimited opportunities in Nigeria in the 1960s but the long duration of ‘leadership without moral purpose’ has destroyed everything. The levels of uncertainties, contradictions, and absurdities in Nigeria today, which are beyond pardon, have prevented analysts, sociologists, economists and other scholars from making a fair prediction of the sociopolitical and economic future of the society. This has made living in Nigeria very challenging and has increased public discontent and disaffection. It has been noted that about 70 per cent of the population is living on less that one US dollar a day!
There are, however, inherent risks associated with living in an unstable politico-economy, including rising crime, unhealthy business environment, and uncertainty in market prices and demands, and uncertainty in planning and budgeting for projects. The uncertainties in the society and rising unemployment, poverty, and hardship are forcing many young professionals to leave Nigeria to unknown destinations. Some of the people in this group with the false hope of get rich quick abroad and some of those who are stuck in the society who are ‘hoping against hope’ are often driven to the dishonest “419” scam activity for survival. And this has stained the image of Nigeria and the many hard working and honest individuals at home and in Diaspora. Of what use is a government that is incapable of meeting the needs of the citizens.
The people need a democratic leader who will bring the change the society needs. Nigeria is a beautiful nation that has been bastardized by the greedy, selfish, corrupt and visionless leaders. Living in Nigeria could be as enjoyable as living in any other beautiful, stable and prosperous society, only if the leaders would create an enabling environment for the people to live and plan for the future. Many of the present political leaders of Nigeria are “deceitful”; the nation may not witness peace and prosperity if they continue to wallow “in deceit and corruption.” The leaders and followers should take “Pride in Workmanship”, and not in perpetrating fraud and corruption.
To spur the fledging economy and help the citizens to plan better the Yar’Ardua administration should adopt appropriate and corrective monetary and fiscal measures to tackle the nation’s energy problem so as to improve the people’s confidence in the system and to properly regulate business cycle or the ups and downs in parts of an economy. It has been noted that social expectations and institutional conditions control business cycle in a society. The uncertainty in the economy will continue without a comprehensive energy policy to ensure steady supply of fuel and electricity to the economy.
This point has been re-echoed and admirably emphasized by analysts yet the leaders are not serious in dismantling the monopoly of PHCN (the offspring of NEPA). There should be a general and radical reconstruction of the polity because simply changing the name of NEPA to Power Holding Company of Nigeria would hardly make any magic, just as the quality of education and literacy rate has not improved since the UPE program has been transformed to UBE. To improve the situation the teachers must be motivated. Thus tackling the root causes of the problems will solve the problem for good.
During periods of inflation (in a normal society) the central bank would adjust interest rates by adjusting the lending rate (among other things), which would affect the liquidity. Sadly, the CBN has not been able to control the amount of money in circulation so as to tame inflation ravaging the economy (BusinessDay, July 1, 2008). A good income tax system is another powerful tool to fine-tune the economy as it provides a reliable source of revenue for national planning. The nation, unfortunately, still relies mostly on slippery oil revenue for national planning and management.
The society may not become a stable and prosperous nation enviable by the world if it remains politically unstable and economically uncertain. The present administration should truly tackle the Niger Delta crisis to maintain political stability and diversify the economy by increasing non-oil-based economic activities to ensure that Nigerians have enough goods and services and at affordable prices. The government should adopt reasoned policies to remove barriers to increased productivity, truly tame corruption, and improve the rule of law and public services.
Nigerians have a big role to play in making the changes they want to see in the society. As Mahatma Gandhi has observed, “Be the change you want to see in the world.” Thus the people could only change the situation for good only if they would positively change their mentality and learn to hold the leaders accountable for their actions because like dictators, the political leaders of Nigeria are in “power without responsibility” (Stanley Baldwin, former British Prime Minister). The leaders and followers should also learn to create wealth and values in the economy instead of idling away and bickering over derivation formula for collecting monthly handouts.
Thus the political leaders and business leaders should focus on the issues that affect the people daily. Although Nigeria’s economic problems are linked with the nation’s institutional deficiencies, business leaders and those in the educational sector should strive to create new knowledge and products and services the public needs. They should also provide insights and practical tools to tackle the nation’s myriads socioeconomic problems and change the society for the better.
It must be said without equivocation, that the only sure way for Nigeria to achieve peace, prosperity, and stability is simply for everyone (individuals, businesses, and all the three levels of government) to do the right thing! Specifically, the present government should untangle the root causes of its lackluster performance and increase its responsiveness to the needs of the people. It has been noted that higher productivity in government will positively affect productivity in the private sector. Finally, addressing the unrelenting increase in the prices of goods and services and the associated uncertainties in the society would require fixing the nation’s dismal social infrastructure, financial, educational, and the regulatory systems. This will improve the supply side of the economy and create a stable politico-economy in which the citizens could live, plan, and enjoy a better quality of life.
Victor E. Dike is the author of Leadership without Moral Purpose: A Study of the Obasanjo Administration, 2003-2007 (forthcoming)
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