COVID-19: Nigeria’s roadmap to recovery

I will like to preface this piece by stating unequivocally that the COVID-19 pandemic is temporary and shall surely pass. However, its disruptive impact is not only taking an unbearable toll on every aspect of human existence, it is also presenting once-in-a-generation test of business continuity and planning. The rules of engagement in human contacts and interactions have changed forever.

Permit me to paraphrase the dictum of Robert Kennedy who said, these are times of danger and uncertainty but there are also the most possibility-filled of anytime in the history of any nation. This assertion can be aptly captured in the context of our country at this time. There is no doubt that these are austere times, but much more, these are times when the creativity and ingenuity of different nations of the world will be tested to the limit.

The world is hard hit by an unprecedented scourge occasioned by the COVID-19 pandemic and the toll it has taken on the global economy is unimaginable. Nigeria is certainly not insulated from the external shocks, global hysteria and the palpable anxiety that have been generated in recent months.

The situation is even direr for an oil producing country like Nigeria whose economic mainstay is the revenue from the sale of oil. Global oil prices have bottom out hitting more than 25 years low with extreme collapse in demand. Our two major crude oil contracts – the Brent Crude and Bonny Light are now ridiculously way off the mark from the 2020 budget threshold. As it stands, the fundamental assumptions and the key benchmarks that formed the crux of that piece of legislation have fallen flat in the face of current realities. The present scenario has voided all government revenue projections and created room for a downward review of the budget.

The oil apocalypse has once again unveiled the vulnerability of the Nigerian economy in view of the rent-seeking model upon which it is built and the non-inclusive growth we’ve had in our years of boom. The prevailing situation is a wake call up for us to urgently begin to think not merely outside the box but completely without the box. This is the time to be as introspective as we can as a people – it is high time we approached our challenges from an inward looking perspective.

We cannot afford the luxury of looking outside anymore; our friends and allies are grappling with their share of the global scourge. So, to think that we will feature on their agenda or they would prioritize us on their scale of preference is as illusory as it is nauseating.

Our unhealthy appetite for offshore loans and beggarly disposition to foreign aids from development partners must be quickly reviewed and checked. We must properly caution ourselves and bit a retreat from our false sense of entitlement on the world stage. For how long shall we continue to rely on the world for anything and everything at every time?

No nation solves its problems by looking outside. The current scenario should afford us the opportunity to recalibrate our worldview by thinking globally but acting more locally. That’s the framework that sets the pace for development in any nation. Therefore, Nigeria cannot take an exemption.

Nigeria urgently needs a Strategic Economic War Room – an assemblage of smart men & women with proven intellectual prowess and sharp-wittedness. Not the old horses or recycled goons this time, but people with fresh ideas who would think and proffer non-debt and innovative solutions with quick-win programs as we battle the ongoing World War C (Corona) or better put World War 3 (based on its severity). We need eggheads who have the understanding of how to unlock some of our nation’s assets to attract liquidity; not those with the damaging mentality and unsustainable propensity to plunge us into more foreign debts.

I must commend the Federal Government for the timely initiative of 774,000 Nigerians to be engaged in public works program with an initial N60Billion budget devoted to drive the process. I pray that this laudable idea won’t be overtaken by divisive politics, nepotism and needless bureaucratic bottlenecks. However, looking at the numbers – 40million unemployed Nigerians and 13million out of school children, we still have a very long way to go. It goes without saying that we need more of such quick win programs and other sustainable measures to contain the impending economic crunch and restore hope to the masses of our people post COVID-19.

Currently, the fundamentals of our economy are on the brink because no solid foundation was ever laid to hold the fabrics of our nation together at periods of emergency like this. We have proven overtime that we are a nation that does not learn from history. It was Ronald Wright who once said, “Each time history repeat itself, the price goes up”. The very high price of our profligacy and negligence is right before us. But I believe that the stark grimness at this time will force us to wear our thinking caps. As bumpy as the ride might be in the months and most likely the years ahead, there is hope on the horizon.

On Friday 3rd April, 2020, Femi Adesina, presidential spokesperson was quoted to have said, “Nigeria may soon become totally broke with no money coming from anywhere.” Of course, a statement from Mr. President’s mouthpiece should not be taken lightly. It comes with a lot of weight and depth of insight as to how things are presently panning out in the country.

On the same day, Bode Ososami, a global economic analyst based in London gave his prognosis of the global economy. He said instead of the U-shaped recovery curve which means a protracted period of slump and then a sharp recovery that global economists had expected, some pundits are now looking at L-shaped recovery curve. That means the global economy which was predicted by IMF to fall by 12% this year, has already crashed so badly that it would stay down for the foreseeable future.

On Thursday 9th April, the World Bank reported that the COVID-19 outbreak has set off the first major recession in the entire Sub-Saharan Africa in 25years. The growth forecast in the region is put at -5.1% in 2020 from 2.4% in 2019. Recently, President Donald Trump predicted that the American economy will experience a V-shaped recovery curve which means the steep fall will be followed by a sharp bounce-back immediately after the pandemic. That is left to be seen.

The Guardian International reported that 24million people have lost their jobs in America in the last 5 weeks with more people still filing for unemployment benefits as employers continue to lay off workers in nearly every corner of the country. Economists are predicting that unemployment rate will reach 15% or higher, levels unseen since after World War 2 in America. In the same breath, the International Labor Organization (ILO) had estimated a 25milliom job loss and more than $3.5trillion losses in workers income globally. However, the world’s foremost labor body has since reviewed its position and concluded that with the pandemic still raging; those figures are somewhat below the mark.

The numbers from the foregoing are not meant to scare us. There are rather meant to give us a clear picture of the scenarios playing out in the global economy and to strengthen our resolve to brace up to the challenges ahead with determination and fortitude. We have to take very drastic and ambitious steps to get our economy out of the woods by looking inward. Our leaders and policymakers must refrain from the undue Americentric, Eurocentric and lately Asiacentric approach in seeking solutions to our problems.

The ongoing copy and paste lockdown approach to the fight against COVID-19 pandemic appears not to be in sync with our socioeconomic peculiarities. The Nigerian economy is largely rudimentary with the predominance of the informal sector – a situation where more than 75% of the 200million population survives on daily income. While in developed economies people are literally being paid to stay at home, the pittance being given under the guise of palliatives in our clime are less than a mere droplet in an ocean.

Apparently, we lack the capacity to sustain additional weeks or months of keeping the economy under lock and key. We run an economy without buffers to cushion the effects of the vagaries of hunger and poverty threatening the wellbeing of the most vulnerable in the society. An extension of the lockdown should not be contemplated.

As deadly as COVID-19 is, experts have told us that its mortality rate is 3%. Why can’t we think and launch an indigenous onslaught against this pandemic? Understandably, the novel coronavirus (COVID-19) spreads faster than the other variances of contagious diseases we have fought in this country. However, we must look inward for local remedies.

Agreed that there is no known orthodox treatment yet, but experts have also told us that in addition to the precautionary measures already put in place, boosting of one’s immune system and inhaling steam are very potent ways that can be used to ward off the virus. Gov Seyi Makinde of Oyo State is a proven case in this regard. He tested positive and after 7days of boosting his immune system with a combination of black oil, honey and local vegetables and fruits rich in Vitamin C while in isolation, his status became negative.

Nigeria is endowed with varieties of fruits and vegetables that have been combined to produce herbal recipes for the treatment of some deadly ailments. President Andy Rajoelina of Madagascar has just unlocked his country after the discovery of a local herbal solution that is being used to treat the people without any record of death.

In the same vein, President John Magufuli of Tanzania didn’t lockdown his country from the outset. He rather adopted a unique and peculiar methodology in fighting COVID-19. That East African nation had 32 confirmed cases with 5 recoveries and 3 deaths but the country was kept afloat with its borders open. His methodology has been strict isolation of anyone who comes into the country for 14days and life is going on seamlessly and the economy is up and running.

We must deploy an indigenous approach to combat this scourge. It would require an aggressive and a well coordinated public enlightenment campaign with an all-inclusive strategy to win the war against COVID-19 in Nigeria while the world awaits a proven scientific cure. All stakeholders including the civil society, community-based organizations, NURTW, market associations, all professional bodies, all foreign missions in Nigeria, traditional and religious organizations, the organized private sector, labor unions and a host of others must be brought on board to join the federal government, state governments and local governments in the fight.

It is more critical now to unlock the economy and get businesses running again. Some strategic measures have to be taken to restructure the finances of the government in order to reboot the economy. One of the fastest among such measures is to fully deregulate the downstream oil and gas sector to attract private sector investment into petroleum refining business. This would cut down on the demand for foreign exchange which the country has hitherto used in importing refined petroleum products for local consumption, create jobs and foster efficiency in the sector.

The wellbeing of our country is contingent on building a well-diversified and inclusive productive economy. Only about four decades ago, Nigeria was one of the world’s largest producers and exporters of palm oil, cocoa and groundnut. Imagine for a moment that we kept pace with that progress, Nigeria would have been in Africa what China is today in Asia. The government must seize this moment and return the country back to those good days. Already, there is a global risk of food insecurity because of the pandemic. This is a chance that we must fancy.

We need to take decisive actions to fundamentally transform the structure of our economy by diversifying to agriculture where we have enormous comparative advantage with over 40% arable land out of the 923,768km2 of the country’s landmass. So far successive administrations have only paid lip service to the need for a diversified economy. To build a more resilient and a more self-reliant economy post COVID-19, the government must also look in the direction of agriculture an avowed determination. To extend single digit interest rate to the real sector to boost manufacturing and create jobs is a task that must be done by the government.

The crisis we face at this time may have been caused by exogenous factors but the solutions are endogenous. It behooves on us to look inward – to engage in introspective reasoning. Therein lies the roadmap to our recovery.

Oyama is an economist. He writes from Abuja.

missangoyam@gmail.com, @MissangOyama05.