Apart from President Bola Ahmed Tinubu’s amorphous ‘Renewed Hope’ mantra, it looks obvious that there has not been any discernible overarching economic blueprint by his administration. This accounts for why there has been a lot of ‘trial and error’ initiatives and failed policies in the past two years of his four-year tenure.
For the same reasons, the unintended outcomes of many of the policies have far outweighed their so-called gains. Indeed, policy somersaults have become a hallmark of the government of the day, so far, as it gets overwhelmed with providing all manner of palliatives to assuage the pains of the citizenry.
Under the banner of economic reforms, not a few policies have been put in place; but most have ended up unleashing poverty, joblessness, and destitution on majority of the citizenry. Nigerians have been exposed to the ravaging effects of an unprecedented hyperinflationary trend that brought their purchasing power to its weakest in several decades.
From about 22 per cent in May 2023, the headline inflation rate spiked to almost 35 per cent at the close of 2024. Similarly, the Naira exchange rate against the dollar nosedived from below N480/US$ as of end-May 2023 to over N1620/US$ of today.
A liter of fuel (Premium Motor Spirit, PMS), for instance, which sold for about N200 at end-May 2023, now goes for N1000 or more. Tight monetary stance saw the Central Bank of Nigeria (CBN) raise its benchmark Monetary Policy Rate (MPR) from about 18 per cent in June 2023 to 27.5 per cent since November 2024. A jump of almost 10 per cent in 20 months!
This very high interest rates regime, indicated by the soaring MPR, has thoroughly whittled access to funds to Small and Medium-scale Enterprises (SMEs) and other economic agents. Not a few businesses have shut down or fled the country due to the lingering policy-induced harsh operating environment.
The resultant effect of all this has been uptick in import-dependency by more Nigerians. Thus, the Nigerian Economic Summit Group (NESG’s) data show that Nigeria’s import bill rose by a whopping 63.3 per cent (year-on-year) to N14.7 trillion in the third quarter 2024, up from N9 trillion in the same period a year earlier.
The NESG said in its ‘Foreign Trade Alert’ that “the surge (in imports) underscores the country’s growing dependence on foreign goods amid stalled local production efforts.” Noting that much of the import expenses went to energy-related items, the NESG said “until local (refining) capacity issues are resolved, the demand for FX to finance imports will remain elevated.”
It is against this background that the approval by the Federal Executive Council (FEC) of a Presidential Executive Order early in May to introduce a ‘Nigeria First’ policy, seems most apposite. But while the nitty-gritty of the new policy is yet in the making, the entire idea of the initiative demands some interrogation and analyses.
First, ‘Nigeria First’ is coming at a time it looks like a mimicking of the United States’ mantra ‘America First’, put together by President Donald Trump. But, while the similarity in name is obvious, Trump’s ‘America First’ is framed to ensure that America’s interests are paramount, and that the country would act to protect and advance them.
‘Nigeria First’, on the other hand, from available information, is focusing merely on getting ministries, departments and agencies (MDAs) to begin to procure locally-produced items, rather than importing. Towards this end, the Bureau of Public Procurement (BPP) is being mandated via the Executive Order to play a critical role by ensuring that the MDAs procure available and durable local substitutes to all (hitherto) imported goods and services for their needs.
Under Trump’s ‘America First’, according to The Wall Street Journal, the world is seen as an arena where nations, non-governmental actors, and businesses compete for power and resources. The new doctrine is also seen as a manifestation of rising nationalism globally, with other countries also prioritizing their domestic interests.
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The question is therefore apposite as to whether Nigeria truly has the guts and muscles to go beyond the symbolism of forcing “local content” improvement on the MDAs only? While America would be driven by “rising nationalism” and “prioritization of its domestic interest”, Nigeria seems set to apply a mere placebo.
A true replication of ‘America First’ in Nigeria would require a truly diversified economy: where substantial foreign exchange earnings come from many other sources than export of crude oil. Unfortunately, the Nigerian economy, despite all pretenses, is yet largely a mono-product economy; and it’s been so for many decades.
Related to this quagmire is the socio-cultural fixation of Nigerians with the consumption of foreign goods and services. Irrespective of social class, creed or tribe, Nigerians have continued to live with a high preference for foreign goods; and an ever rising propensity to import them. This proclivity also underpins thriving smuggling ‘business.’
It therefore goes without saying that any meaningful attempt at making Nigerians consume ‘Made-in-Nigeria’ must place a very high accent on altering the tastes and predilections of our people. It also entails deliberate leapfrogging of the economy to improve production and productivity; and drop the toga of a mere consuming economy!
There is also the challenge of ‘Nigeria First’ being hosted and driven only by the Bureau of Public Procurement (BPP). Apart from the entrenched ruinous corruption of which BPP is not immune, the agency is unlikely to have the full complement of technocrats and other resources to attain the ‘nationalistic’ initiative of ‘Nigeria First.’
Essentially, BPP is set up for monitoring and overseeing public procurement, ensuring transparency, efficiency, competition, integrity, and value for money in government contracts. But, if the much-touted ‘Nigeria First’ is to truly impact Nigeria, its articulation and execution requires a tight and broad public and private sector partnership at all levels.
The requisite psycho-sociological and cultural re-orientation of Nigerians with respect to the consumption of ‘Made-in-Nigeria’ is certainly outside the purview of BPP. The badly needed accelerated filling up of the extant huge infrastructural gap is definitely outside the BPP’s domain.
The diplomatic maneuvering and trade (re-) alignments within the Economic Community of West African States (ECOWAS) as well as under the African Continental Free Trade Agreement (AfCTFA) are also very critical. At the moment, therefore, it looks safe to say that Nigeria is ‘too weak’ to effectively realize the ‘Nigeria First.’
This, in part, is why it is necessary to admonish that what the country is about to put in place is not a mere caricature of ‘America First.’ The Bola Ahmed Tinubu administration has had many failed or ill-digested policies, and cannot afford to have one more. ‘Nigeria First’ deserves be taken through a legislative process to attain proper legal existence.
‘Nigeria First’ should not be a mere brainwave; but a properly articulated blueprint for an accelerated and sustainable development of the country economic. That is the only expectation!
- The author, Okeke, a practicing Economist, Business Strategist, Sustainability expert and ex-Chief Economist of Zenith Bank Plc, lives in Lekki, Lagos. He can be reached via: obioraokeke2000@yahoo.com (08033075697) SMS only