Redefining Capital in the Nigerian Context

economy
  • Redefining Capital in the Nigerian Context

According to a recent report by TechCrunch on transportation technology in Israel, “there are twelve companies left standing in the global ridesharing market, and nearly half were built in a country of 8 million people and the size of New Jersey.” The question that will cruise through any curious mind is, how does such a “small” country that is relatively lean in natural resources create so much value for the entire globe? Nigeria has a staggering population over twenty times and a land mass about forty five times that of Israel, yet it cannot measure up when it comes to value creation.

As the old but apt proverb of the wise King Solomon goes “much food is in the tillage of the poor; but there is that is destroyed for want of judgment”. It may seem a reasonable judgement that the present economic menace, which has been attributed to the downturn in international oil price, fall in oil production due to activities of militants in the Niger Delta, and the currency crisis that has caused the Naira to plummet against the Dollar, is directly or indirectly a product of misplaced judgement on what the true capital of our nation is. Perhaps, we will begin our journey to recovery and healing from the Dutch disease that has plagued our nation if we begin to actively refocus and redefine capital in the Nigerian context. This redefinition is even much morepressingnow in the face of the recent Paris Agreement, where it was made clear that the world is taking concerted effort towards decarbonisation. It will be sheer foolhardiness for any country to keep focusing on crude oil as its sole or major capital.

At the nucleus of capital redefinition ought to be human capital. Although Nigeria tops the global human population table, what the country lacks is human capacity, the key driver of development and progress. The fusion of its population strength with human capacity development will give Nigeria a competitive advantage both locally and globally; otherwise, the population strength becomes a threat to its continuous existence and development. China, the world’s most populous country, is ramping up its economic power by leveraging on its population strength, which accounts for both its labour force and its market share.

The country empowers indigenous companies to thrive both at home and abroad, just in the same way it directly empowers its people to be productive. I once worked in a Chinese firm that operates within the Nigerian technological space. In all honesty, it was mind-boggling how Chinese citizens who are not inherently smarter than their Nigerian counterparts were dominating Nigerians, in number, ranks and in control of resources in our own country. The truth is, they were empowered to do so. Indeed, it is not a question of who is better off between Chinese firms or Western firms when it comes to foreign firms operating in Nigeria; it is a question of Nigerians taking their own destiny in their hands and calling the shots on any firm that wants to operate (make money) in Nigeria. Sadly, this comes only by empowering the people. Successful countries develop their human resources who in turn make their countries successful.

Therefore, what Nigeria must do urgently is to restructure both the formal and informal education sectors. This restructuring must begin from the grassroots, withelementary schools, and must enable the participation of both the public and private sectors in a properly defined and regulated manner. Nationwide vocational training and apprenticeship programmes should be revamped, and a partnership between the government, academic institutions and employers of labour should establish research directions, academic syllabuses and on-the-job training schemes that help provide solutions to our (local) problems and develop necessary skills for the labour market.

More so, we must understand that it will not suffice to develop talents, we must create opportunities and provide enabling environments for talents to thrive. We must discourage a culture that promotes mediocrity, and build strong institutions that encourage and reward excellence. A nation is as developed as the majority of its people are.

What are our core values as a nation? What is it that every single Nigerian will stand up for, to defend and protect? Is there any clear-cut direction as regards where we are heading together as a nation? There have been lots of arguments about whether our diversity as a nation is a blessing or a curse. The truth is, it is what we make of it. The point I am trying to address here is ofsocial capital, which is closely linked to human capital. People have always viewed the subject of national development mainly from the economical vista, however, the sociological perspective is equally as important.

Researchers have outlined three dimensions to social capital when it comes to value creation within any organisation. These three dimensions are structural, relational and cognitive dimensions.

In the Nigerian context, these dimensions cut across our ethnicities/cultures, beliefs/practices, work ethics, family and community orientations,value systems, and our lifestyles in general. While most of these things have been greatly influenced by the western world so much so that it is becoming unclear what our true identity is, we must set out clear-cut strategies to refine our identity. For example, we must discourage our consumer-centric mindedness, which only makes us numbers on the market share indices of productive economies, and replace it with a productivity-centric mindedness. We must develop a reading culture. We must instil in our children a problem-solving mentality and impress in their mind that the essence of going to school is not so as to get a good job, as our own parents told us, but it is so as to be able to solve societal problems. As a nation, we really cannot excel beyond the level of our attitude.

Furthermore, we must redefine our physical capital with an eagle-eye perspective that sees beyond crude oil. Arable land, infrastructures, mineral resources and finance should all fall into this category.In his book “How Asia Works: Success and Failure in the World’s Most Dynamic Regions”, Joe Studwell argued that critical interventions in agriculture, manufacturing and finance can help poor nations achieve rapid economic transformations.

In the Nigerian context, high labour-intensive household farming should be encouraged. Not only will this help bring about a judicious use of land and labour, it will increase outputs and also facilitate rural development. This should be backed up by appropriate policies and incentives, and should be taken as a supportive measure for reforms in large scale farming.

Manufacturing, which according to a 2016 report by the Boston Consulting Group, accounts for 10.6% of Nigeria’s GDP in 2013, is a promising avenue for the country to grow not only its GDP, but also its foreign revenue. This will require that the government engages the private sector in ways that attract investment and entrepreneurs,in order to ramp up development of infrastructures and the production of goods;to meet local demands, thereby reducing our reliance on imports, and also for exports to neighbouring countries andthe rest of the world.More so, the engagement of the private sector, and in fact every action involved in this redefinition process, must be structured around long term rewards and not short term gains.

To accomplish this redefinition, intelligent but radical efforts will be required, and these efforts may even be against the general concepts and ideas set out by international governing bodies. We must develop policies and initiatives that are locally sourced and that are relevant in the context of our own realities, and curb our dependence on international concepts or ideas. The sane thing is for us to get enlightened by exposure to these international concepts, then bring them home in a partially (or completely) modified and customised version. The present government can, together with its fight against corruption, make efforts to reduce the cost of governance and divest the savings towards human capacity development.

The Imperial College Nigerian Society (ICNS), the body of Nigerian students–and any student with interest in the Nigerian culture–currently studying at Imperial College London, has been at the forefront of discussing and enlightening our community on issues such as the ones addressed in this article, with the aim of actively advancing the cause of our great nation and helping to bring about an inclusive prosperity. We have been doing this through our annual symposium. This year, the theme of our symposium is “Creating Local Value with Global Standards”. The date is 4th of November, 2016 and the venue is The Great Hall, South Kensington Campus, Imperial College London.

 

About the Author

Samed Olukoya
Samed Olukoya is the CEO/Founder of investorsking.com, a digital business media, with over 10 years' experience as a foreign exchange research analyst and trader. A graduate of University of East London, U.K. and a vivid financial markets analyst.

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