The 12 Steps Recovery Programme from Oil Addiction is a composite of the current reforms being carried out in Nigeria, along with those successfully implemented in developed and emerging economics. Some of its recommendations are also bore from avoiding the mistakes in others in faulty implementations of reforms. Nigeria has an enviable position from learning what has worked in other countries and what has not.
The “12 Steps” focuses on sectors in need of attention for the plan to be successfully implemented, as they would hold the key to shoring up the Nigerian economy and provide a platform to launch its people into prosperity.
It must also be mentioned that while a good size of the recommendations involve liberalisation and deregulation, it must not be confused with non-regulation. A poorly regulated or unregulated industry only lays down the foundation for much bigger problems in the future as the US financial crisis can testify to.
The programme is designed to address the following:
1. Transportation: A more efficient transport system allows for the movement of goods and people to all corners of the country.
2. Communications: Communication systems eliminate the physical distance between any two communities and allow for the speedy exchange of information. In today’s world of increasing globalisation, it is now a requirement for any business to be able to communicate effectively and quickly.
3. Energy: Every aspect of the economy is dependent on energy. The vital role it plays in today’s society cannot be understated. The provision of affordable energy and the constant supply of power to light up houses, offices and factories will be essential in getting the Nigerian economy back on track.
4. Healthcare: A healthy workforce is the engine of any economy. Failure to cater for the health needs of the country’s population only leads to a decrease in the production of goods and services as workers take more time off work than they need to.
5. Education and Training: An educated workforce is a more efficient workforce. A better educated population also present multiple opportunities for the economy to diversify beyond its traditional pillars. This was an approach followed by the Asian Tigers, who invested heavily in education to produce a workforce that could provide value-added services as income generators for economies that had little or no natural resources.
6. Agriculture & Natural Resources: With the global food prices on the rise and Nigeria being a net importer of food, the country will be better served by reviving its agriculture sector, which was also Nigeria’s chief export earner before the discovery of oil. The availability of cheaper foods will also lead to an increase in the quality of life for Nigerians as more people will be able to afford put more food on the table for their families.
7. Environment: Damage to the environment has long term implications to the Nigerian economy as it can lead to a deterioration of health of the general population, a depletion of natural resources and increased cost of doing business. It is much cheaper to put in preventive measures to protect the environment than to clean it up down the line. Protecting the environment is no longer a social issue but an economic one, and one that the Nigerian government will need to embrace fully.
8. Finance & Housing: A strong financial sector stimulates growth in the private sector through the availability of credit and can lead to more affordable housing for the average Nigerian.
9. Enterprise & Innovation: Promoting micro, small and medium sized enterprises (MSMEs) can lead to a reduction in poverty and unemployment, and lead to wealth creation for the owners of the businesses. All these have a direct effect on the economy, and it also useful in reducing the wealth gap between the haves and have-nots.
10. Legal & Security: The enforcement of contracts and adherence to the rule of law not only provides a suitable environment for doing business locally and fighting corruption, it can also lead to increased confidence almost investors looking to plough their money into the Nigerian economy.
Increase internal security also fosters external foreign investment and adds to the quality of life of the country’s citizens. Tackling the crisis in the Niger Delta region and the wave of violent crime across the country will go a long way in improving the country’s image.
11. Trade: Improved trading opportunities in Nigeria’s non-oil sectors can be a major foreign currency earner for the country. Nigeria has a number of mineral resources that have yet to be exploited due to the government’s focus on petroleum.
Also the country is blessed with cheap labour but high energy cost and poor infrastructure have discouraged the growth of a manufacturing base in the country. If an enabling environment where the overhead costs of operation can be brought down to within reason, along with the enforcement of laws in the country, protection of investors, and education reforms, Nigeria can develop a manufacturing base that can rival those in South East Asia.
12. Tourism: Tourism is a good foreign currency earner for any country as every tourist dollar spent has a multiplier effect on the local economy. Improving internal security, improved transportation and a strong financial system can aid the government s efforts in improving the tourism sector in the Nigeria.
The country has lot to offer from the diverse ethnic makeup of the country to different climatic conditions (hot humid weather in Lagos, cool temperate weather in Jos) and geographical features (Mangrove swamps in the south, arid savannah in the North). There is something for everybody.
The “12 Steps” were selected to achieve the following:
Increased Efficiency in the Economy: Improvements in the transport, communications and the energy sector will bring about a reduction in the cost of production and distribution of goods and services. This will invariably lead to putting goods and services within the reach of more Nigerians.
Better Quality of Life: Improvements in education, healthcare, agriculture and housing sectors will bring about an improvement in the quality of life of Nigerians. Also taking active measures to protect the environment, not only improves the quality of living in the country, it also prevents huge avoidable costs in cleaning the environment later in the future. Lastly improvements in security will make the people feel safe.
Fight Poverty: Promoting and supporting enterprise, along with improvements in the financial sector and legal framework will foster the growth of micro, small and medium sized enterprises (MSMEs) which have been show to fight poverty, increase wealth creation and reduce unemployment.
Increased Investments: Improvements in the infrastructure, along with those in finance, security, enforcement of laws and education should bring about an increase in both local and foreign investments. The presence of the right infrastructure makes it cheaper to produce goods and services, the enforcement of laws makes it easier to conduct business, and an improved educational system produces quality candidates from which companies can select their staff from.
Increased Foreign Earnings: Improved trade and tourism will bring about an increase in much needed foreign earnings.
Diversification: Opening up other sectors of the economy brings out diversification, making the country less reliant on a traditional base e.g. agriculture and oil. This is particularly significant for rural communities.
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