WHY ECONOMIC RECESSION IN NIGERIA MAY NOT END IN 2017 OR 2018.

There is recession in Nigeria!!!! Hunger in the Land!!! Famine in Nigeria!! Are some of the headlines that I have come across on some portals and websites describing the  malaise currently impacting the average Nigerian on a negative level. The prices of crude oil has not risen to where it used to be,militants have not backed down on destroying oil infrastructure, investments in the oil and gas sector has reduced as investors are scrambling for escape routes, multinationals are downsizing, job loss is a reality in the private sector, no ray of hope in sight for the average opulent Nigerian whose source of income has been threatened or closed down in the face of harsh economic reality.

The heat is real in the Nigerian socio-economic sphere because of rising cost of good and services with no significant rise in disposable income of the average Nigerian. This is as a result of the means that the value of the Naira against its foreign counterparts has weakened in terms of purchasing power. I have been a keen observer of the events for almost a year now and I have witnessed policy somersaults, overhaul, and outright reversal inconsistent with a serious drive to end currency depreciation.
The challenge facing the Nigerian economy is hydra headed including  fiscal, trade, instability, etc.

What do I mean by fiscal? Fiscal policy of a nation  is the means by which a government adjusts its spending levels and tax rates to monitor and influence a nation's economy. It is the sister strategy to monetary policy through which a central bank influences a nations money supply(Investopaedia.com)  A Fiscal policy refers to all monetary policies guiding government spending and borrowing. In the face of dwindling business and enterprise activities, it means lesser tax will come to the government than expected; 

 The economic direction is usually amplified by the direction in which major fiscal policies of government is headed. For example, recently, the monetary policy rate was jacked from 11% to 12% and from 12% to 14% within a space of 3months(12% in March, 14% in June 2016).If from 11 to 12% the interest rate is increased by 100 basis point(100%) then your guess will be as good as mine considering the 12%-14% increment.

 This is the rate at which the CBN lends money to deposit money banks operating in the country.    which means that up from interest rate on fixed instruments like the treasury bills and bonds rose to a record high of 14-18% depending on various tenor and 22-25% which means that people with spare cash will rather go and keep their money in banks to yield interest rather than produce or manufacture.

The following are the reasons why I am sure Nigeria may not come out of recession in 2017 and 2018

• Low refining capacity: According to Ifeanyi Uba, heavy demand for dollars are from  petroleum marketers who need to import petrol, diesel and  aviation fuel(kerosene inclusive) into the country. Research has shown that crude oil has about 5,000 fractions that can be gotten from it after fractional distillation and it is from these fractions that majority of indstries in Nigeria get their raw materials: Plastics, textiles, polymers, polyesters, petroleum wax, grease, petroleum jelly, lubricants for automobiles and earthmoving equipment, packaging materials for sachet water, bottled water, foot wear, clothing, fertilizers, etc are some of the by products obtained from crude oil and most Nigerian companies import most of these items at the moment.

• Low electricity generation for Industrial and manufacturing purposes: One of the main operational costs of most manufacturing industries operating in the country is in power generation. These businesses spend as much as 60% of their operational costs on power generation. Diesel is a major fuel used by these companies. Rising cost of diesel will  mean production will be halved,cut or out rightly discontinued.

• Fiscal and monetary policy: Many manufacturing companies depend on forex for their raw materials and if they don't have access to the official window at the appropriate time, time value of money would have eroded their expected profits.

• Low Agricultural production; There is a lot of noise about agriculture yet little has gone into creating a value chain for agricultural products to ensure all year round availability. Ever year thousands and even millions of tonnes of perishable goods are wasted due to poor infrastructure for a sustainable agricultural production and storage. The Nigerian state officials on highways do not help matters either- Bad roads+ road block+ extortion+ time wastage+ arrest are some of the ills bedevelling agriculture in modern Nigeria. Export potential of agricultural commodities can never be realised until these bottlenecks are addressed and removed.

• Farmer- herdsmen clash: Boko haram has successfully rendered the vast land of NE Nigeria to  fallow  as a result of the death and displacement of thousands of farmers. Herdsmen and farmers clash has resulted in countless loss of lives with its attendant effect on Agricultural output.Examples abound in Southern Kaduna, Plateau State. Benue State, Taraba State, and south Eastern States.

Solution: 

Government is responsible for the welfare of her citizens and the people must hold her government responsible for that sacred duty as laid down by law. If need be, every Nigerian farmer must be able to bear arms for protection against intruders and marauders into farmands. In Switzerland, land tenure system permits agriculture in homes and they exchange proceeds after harvest which is one of the reasons swtizerland has unparalleled standard of living and a healthy population. Small scale agriculture can boost communal participation, it is capable of eliminating poverty and making food available of reasonable costs. 

                                                   THE  ASSET
                         
                 

The greatest asset any young person can have right now is their strength. The strength of their passion- when they fall in or out of love, strength of their emotions-in expression and interactions and their strength when dealing with a foe- young people are some of the most violent crimes are being committed by young people hence without an iota of a doubt, young people are strong.

However, young people have an orientation, a background, a family , a society and a group of peers who have in one way or the other made some inputs into a young folk's life. The responsibility of a man to his family, friends, society and country is one of the most taught values in modern education and informal gatherings.
 The strength of the youth is his fire power to drive his will down the road of execution without any hindrance- and if any, he rages his way through his obstacle like a mother bear robbed of her whelp.
If for any reason, a young man reaches his dead end, his last hope, his winding tour, if he peers out of the window of security to find his retinue of friends and admirers but finds none- How dejected he will be!!!
 A strong man finds joy his abilities, a man of great ability relishes every moment of triumph as his stamp on the foot prints of time- a memorial that cannot be erased by the cacophony of activities and businesses. A strong man finds time to look inwards then outwards, not the other way round.
Great men have humility, compassion, meekness, love, purity and above all equity and justice for his fellow men.
Where there is no brother hood there will be falsehood and false hood is the author of wormwood which makes the souls and lives of men bitter with fire and anger. Brotherhood is the bond of  blood, sweat and honor to abide and be true to one another in the face of daunting difficulties-no matter how life threatening!
A young man's strength can win a heart thousands of miles away in the wilderness and bring her home hundreds of furlongs into the woods for a relish of a lifetime in the cabin. Fortunately, the strength can raise funds, start a business, run the vision, create the services, manufacture the products, push the market and forge a name that will remain indelible in the hearts of the sea.

Arise! Arise oh Young one! Raise up from your dust and shake it off!! Your time is now. Not tomorrow, not yesterday!! It is now!!!

The contribution of each economic sector of India to its Employment of Labour in 2010(https://commons.wikimedia.org/wiki/File:2010_Percent_labor_employment_in_India_by_its_economic_sectors.png)

The global economic sectors can be easily classified into five distinct groupings:

1. Services Sector
2. Agriculture
3. Manufacturing
4. Transportation/Infrastructure
5. Technology

Other classifications like construction, real estate,tourism, arts, entertainment etc, can be grouped  either under services sector or Infrastructure depending on the classification model employed by relevant agencies in the various countries.

Agriculture is the oldest profession known to man and not Prostitution as widely claimed in some quarters.  Human civilizations thrived or perished at their level of expertise or ignorance on agricultural practice. Survival meant an instinct for food, water, heat and shelter.  With this came devices for hunting and producing more food, tools, for cutting, fire making, shelter making etc.

A great industrialist once said " Agriculture, Manufacture and Transportation are the core essential duties of man, failure of which his life will never see a balance". How true! The modern economy still depends to a large extent on agriculture because of an ever- increasing gap between the rich nations who are self-sufficient in agricultural production and developing nations who are ravaged by wars, diseases, famine, corruption and extreme poverty.
Agriculture is the largest employer of labour in most developing countries of the world today and it is no news that the United Nations with other relevant global agencies, have recognized this as an important means of combating severe hunger, poverty, diseases and malnutrition in many nations.

A case study of a BRICS country (India)

"Agriculture is an important part of Indian economy. At around 1.53 million square km, India has the second largest amount of arable land of any country after the U.S.A.,with percentage of cultivated land compared to total land area being close to 52℅, second highest after Bangladesh(over 68℅) among major labour-intensive agricultural economies. Although the total land area of the country is only slightly more than one third of China’s or the U.S.A.'s, India’s arable land is marginally smaller than the U.S’s,and marginally bigger than china's. In 2008, a New York Times article claimed, with the right technology and policies, India could contribute to feeding not just itself but the world. However, agricultural output of India lags far behind its potential. The low productivity in India is a result of several factors. According to the World Bank, India's large agricultural subsidies are distorting what farmers grow and they are hampering productivity-enhancing investment. While overregulation of agriculture has increased costs, price risks and uncertainty, governmental intervention in labour, land, and credit markets are hurting the market. Infrastructure such as rural roads, electricity, ports, food storage, retail markets and services are inadequate. Further, the average size of land holdings is very small, with 70% of holdings being less than one hectare in size. Irrigation facilities are inadequate, as revealed by the fact that only 46% of the total cultivable land was irrigated as of 2016, resulting in farmers still being dependent on rainfall, specifically the monsoon season, which is often inconsistent and unevenly distributed across the country. To bring an additional two crore hectares of land under irrigation through various agriculture schemes including Accelerated Irrigation Benefit Programme (AIBP)for which a provision of Rs 80,000 crore has been sanctioned in the union budget. Farmer incomes are low also in part because of lack of food storage and distribution infrastructure. A third of India's agriculture produce is lost from spoilage".(https://en.wikipedia.org/wiki/Economy_of_India)

Personal Opinion

Developing and Developed countries around the world all have their peculiarities which make them unique. However, it is important that the young ones take the advantage that agriculture offers as this is guaranteed not only to bring them to a closer level with nature, it will also ensure efficient and judicious use of currently endangered nature's resources, bearing in mind that some generations left what we have now with us and we have similar responsibility to ensure that the cycle goes round.