With just one year until year 2020, Nigerian government seems to have jettisoned its vision 20:2020, the goal to be among the 20 largest economies in the world by that time. For now, there is no sign that this target is still on the front burner, reports BusinessDay.
According to International Monetary Fund’s (IMF) latest nominal GDP ranking for 2017, Nigeria took the 31st spot with a GDP figure of $376 billion, behind Austria (28th), Norway (29th) and United Arab Emirate (30th).
Vision 20:2020 was enunciated in 2009 during the Late Yar’Adua administration. The mandate is to ensure that the economy of Nigeria is among the largest twenty economies in the world in terms of GDP size by the year 2020
“The reality of the matter is that current and preceding governments have abandoned the vision 2020 project. A vision doesn’t materialise on its own, there must be milestones to measure progress and ensure continuity of plan,” Johnson Chukwu, CEO, Cowry Asset Management Limited, said.
Considering that the economy’s recovery from recession has been sluggish, Nigeria has lost its place among the fastest growing economies in Africa, let alone the world.
After the economy exited from recession in the second quarter of 2017, GDP growth rates recorded have been positive, but staggering. For instance, GDP growth rate fell from 2.11 percent in Q4 2017 to1.95 percent in Q1 2018 and further to 1.5 percent in Q2 2018 before rising to 1.81 percent in Q3 of 2018, data from the National Bureau of Statistics showed.
According to the blue print laid down by the Late Yar’Adua administration, the strategies to achieve the vision anchors on investment in infrastructure, human capital development and structural reconfiguration of the economy from monolithic to a diversified and industrialised economy.
As of December 2018, government spending on health and education, the twin foundation of human capital development have not had any significant improvements at four percent and seven percent respectively, considering the fact that these figures stood at 3.2 percent for Health and 5.5 percent for Education as at 2010 when implementation of the grand vision was to kick-off. In the 2019 proposed budget, a paltry 5.2 percent has been allocated to education and 3.6 percent for the health care of a population of about 198 million people that is projected to be growing at 2.6 percent a year.
On the global scale, Nigeria in 2017 scored very low (0.532) on the United Nations Development Programme (UNDP) HDI report which rates performance between 1, very high HDI and 0, very low HDI. This poor performance led to the country being placed 157 out of the189 countries assessed.
Peer African countries like Ghana (0.592), South Africa (0.690), Egypt (0.696) and even neighbouring Cameroon (0.556) ranked in the medium class, while Libya (0.706) and Algeria (0.754) were ranked in the high human development category.
The above picture of Nigeria’s low ranking on human development was further reinforced with the maiden edition of HDI ranking by the World Bank in 2018, which also put Nigeria at 152 out of 157 countries assessed by the Bank.
Infrastructure development still lags significantly, with Mary Uduk, Director-General of the Securities and Exchange Commission, estimating that infrastructure deficit will rise to $878 billion by 2040, if government continues to neglect developments in the sector.
In terms of diversification, as at Q3 2018, crude oil constituted 85.4 percent of total export, according to data from the National Bureau of Statistics. The 2016 recession, the worst in 29 years, was occasioned by the fall in benchmark Brent, which accounts for 90 percent of government’s revenue. The shock was transmitted into the sectors of the economy and growth rate in Q2 2016 fell 2.06 percent into the negative region. Although Nigeria has officially exited the recession, the economy is still smarting from the effect of that oil price shock.
So far, the framework in which the Vision 20:2020 target would be achieved seems weak and with the present Economic Recovery and Growth Plan, Nigeria seems to be occupied with a much different growth strategy.
Compare this with the case of Rwanda. This East African country has largely rewritten its economic narrative, rising out of post-genocide despondence with a negative growth rate of -50.2 percent, to become one of Africa’s fastest growing economies with an average annual growth rate of 6.1 percent by 2017. In fact, Rwanda is the third-fastest growing economy in 2018 with a growth of 7.2 percent.
In 2000, President Paul Kagame, after extensive consultations, outlined objectives and path to grow Rwanda from an improvised, crisis-torn, and low-income agrarian economy to a medium-income economy led by the service sector. Rwanda summarised this aspiration in its Vision 2020 plan.
In the plan, the government affirmed its commitment to invest in its people: ‘At the core of our development process will be what constitutes Rwanda’s principal asset: its people. Human resources will be improved, so that Rwanda can become a knowledge-based economy. In particular, we will actively encourage science and technology education and ICT skills…’
Today, the years of commitment and effective implementation of policies to promote the Vision have yielded good dividend in the country, which is fast becoming a regional ICT hub in East Africa, a major exporting country and its tourism industry is thriving.
Experts believe that this dream statement would most likely not be achievable because there is a syndrome of lack of continuity in policy implementation, which triggers policy failure in Nigeria.
“If we want this (2020) or any vision to be achieved, economic milestones must be achieved and the plan has to be enacted into law so that successive governments will have little room to deviate from the development plan,” Chukwu said.