According to the National Bureau of Statistics, the unemployment rate in Nigeria is about 27.1 percent which means about 22 million people do not have jobs and if you add the underemployment rate it is nearly about 54 percent.
Young people make up a significant portion of this statistics as about 60 percent of the Nigerian population is under the age of 35 with more than 13 million between the ages of 15 – 24 either unemployed or out of jobs.
In 2015, the Nigerian economy was recorded as the largest in Africa, however, the economy is not growing as fast as its population. Hence, the rising cases of poverty and the gradual decrease in the middle class due to an economy that has faced recession twice in the space of five years and coupled with the effect of the coronavirus pandemic.
Over the last five years, we have witnessed a reduction in the purchasing power of the average Nigerian and the gradual slip into poverty for millions of people especially women who have little or no education.
In other to cushion the effect of the rising inequalities, the President Muhammadu Buhari administration created the Economic Recovery and Growth Plan (ERGP) between 2017 and 2020 as a medium-term all-round developmental initiative focused on restoring growth, investing in people, and building a globally competitive economy with a target of lifting 100 million Nigerians out of poverty.
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A major crux of the ERGP is the social investment policy to provide low-cost investment and credit facilities for traders, farmers, youth, and vulnerable members of the community.
According to the plan, it will see the economy grow from 2.6 percent in 2017 to a peak of 7.0 in 2020 by investing in human capital development focusing on science and technology and labor-intensive sectors for youth, health care services, industrialization with a focus on small and medium enterprises, adequate power, better infrastructure, efficient transportation, and improvement in the agricultural value chain.
With this plan, an average of 3.7 million jobs was to be created yearly to inject the economy and reduce unemployment from 13.9 percent to 11.23 percent. With this exciting plan, how then did the unemployment rate grow to 27.1 percent?
According to the World Bank, Nigeria over the years had failed to invest in rural and peri-urban communities while concentrating investment efforts in the cities. This failure in leadership made people migrate to towns and cities looking for better livelihood prospects.
The large influx of individuals led to a low purchasing power as there were more people than the economy can cater for. This has led to a gradual decline of the middle class with a new daily purchasing power of about 700 naira for almost 42 percent of the population and even lower for those in the northern part of the country.
It is evident that Nigeria needs a new plan that will focus more on inclusive growth, government transparency with urgent and deliberate actions towards achieving inclusive peace and prosperity. Below are four ways that Nigeria can lift 100 million people out of poverty by 2030.
First, focus on human capital development and not oil. The coronavirus pandemic has shown that investment in people especially for the digital economy yields more dividends in the short, medium, and long term.
Nigerians have shown resourcefulness in the presence of absent infrastructure and policy gaps to thrive in conditions that will otherwise not provide growth. Imagine if every system is in place to support the ingenuity of the Nigerian spirit. With the fourth industrial revolution, more jobs will be tech-enabled and this is the new oil that the government needs to focus on.
If we invest in education and life skills training for our youth, it will provide the impetus to galvanize an economy that is already import-dependent.
The Nigeria Youth Employment Action Plan is a document which policymakers need to ensure its implementation as well as the National Youth Policy to ensure adequate investment in education, employment, entrepreneurship, equality, and rights.
Countries like China and India have taken advantage of their large population to boost economic growth with a long-term strategy of investing in people with education and decent work at the core.
Secondly, the Nigerian government needs to build trust and be transparent in the approach to governance. Millions of Nigerians do not trust the government with regards to fairness, accountability, and transparency, and policies that are focused on creating a thriving economic environment.
Currently, insecurity is a major issue in the country with the government spending more than one billion USD in 2017 to fight the Boko Haram insurgency in the North East.
Citizens say that these monies are not well accounted for as the government seems not to be winning the war which began about 12 years ago. In terms of public service delivery, the agencies of government serve as a stumbling block to the ease of doing business in the country, from business registrations taking months to be processed, to multiple taxations from federal, state, and local government to monetary policies from the apex bank which are anti-business.
In the bid by the government to lift 100 million people out of poverty, improved security, respect for the rule of law, better transparency and accountability, and improved public service delivery are essential to building trust between the government and the people.
Thirdly, Nigeria needs to encourage market-creating innovations and support adequate financing for the private sector. In countries like China, India, and Singapore, we have seen how innovation has transformed the lives of the citizens and this is backed by functional infrastructures like adequate power and efficient policies that support innovation and growth.
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Our population provides a unique opportunity to sell internally and for export and this is hinged on the government making the right decisions to foster economic growth. For instance, the power situation in Nigeria can be improved with the use of solar panels since we have a large amount of sunshine, however, government policy warrants high taxation on solar products, and hence people must continually use generators that are hazardous to the environment.
Encouraging market-creating innovations ensure that special privileges are not given to certain individuals or groups and encourage prevailing market forces backed by good ease of doing business policy.
Fourthly, the effects of the coronavirus pandemic have reversed economic growth globally and Nigeria inclusive and hence the opportunity to embrace social entrepreneurship. Social entrepreneurship provides a fantastic opportunity to recover better by concentrating on essential aspects of the economy that needs an immediate boost and can provide meaningful employment for everyone with or without a formal education.
According to the 2020 World Youth Report by the United Nations Department for Economic and Social Affairs, social entrepreneurship can both support youth development and help accelerate the implementation of the SDGs.
Recently, the Nigeria Youth SDGs Network in partnership with the International Labour Organization and the Federal Ministry of Youth and Sports conducted a survey to understand the decent work aspirations of young Nigerians and more than forty percent of the 212,000 respondents say they desire work that will help them contribute meaningfully to the development of their community. Focusing on social entrepreneurship will help create wealth and fix social issues.
As Nigeria makes a plan to lift 100 million people out of poverty, it is essential that government must pay adequate attention to ensuring that policies and programs are focused on improving the welfare of the average Nigerian.
About Joshua Alade
Joshua Alade is a highly driven, organized, and compassionate individual who is able to strategize, advise, liaise, and effectively communicate with high-level individuals, investors, business, academia, donors, board members, governments, international organizations, civil society, media, and community members.
With 6 years of experience in nonprofit, policy, and business focusing on social impact. He is passionate about partnerships, global development, and transformational change. You can read more of his writings here.
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