Peter Obi’s verdict: Nigeria needs to move from consumption to production-based economy

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The Vice Presidential Candidate of the Peoples Democratic Party (PDP) during the 2019 general elections, Mr Peter Obi, has explained that Nigeria’s economy, which, he said, was largely consumption-based, needed to become production-driven for a sustainable growth and development to be witnessed in the country.

Obi stated that part of the reasons Nigeria’s economy performed poorly on many fronts was because of the inadequate production of goods and services to satisfy local demand, thus encouraging excessive importation of such goods and services.

He made these observations in his message to mark Africa Industrialisation Day celebrated on November 20 every year. Obi pointed out that the inability of the government to support a full private-sector driven economy tells negatively on Nigeria’s economy.

Associating the public sector with wastages and bureaucratic bottlenecks, Obi maintained that innovation, higher productivity, jobs creation and economic growth could be achieved with a greater private-sector participation in the economy.

He also regretted that Nigeria, richly blessed in human and natural resources, still highly depends on imports, while exporting very little. This, he said, not only explained the negative trade balance of the country, but also pointed to the apparent lack of industrialisation in the country.

“According to the recently released foreign trade report by the National Bureau of Statistics (NBS), Nigeria extended its negative trade balance in the first half of 2021, as its trade deficit surged to N5.81 trillion in the period. The report showed that Nigeria exported total merchandise valued at N7.99 trillion in the review period, opposed to a total import value of N13.8 trillion, indicating a negative trade balance of -N5.81 trillion between January and June 2021,” he said.

Among others, Obi identified insecurity, corruption, lack of power as factors militating against Nigeria’s industrialization. He called on the government to make more concerted efforts towards industrialization and transforming the economy to production-based. He argued that by so doing, “the economy will see a reduction in Nigeria’s unemployment which will ultimately reduce hunger and poverty, there will be adequate supply of goods and services and Nigeria’s trade balance will improve.”

“I have always sued for the support of small businesses. They are the engine of economic growth. With well-articulated fiscal and monetary policies, our small business sector will boom and catalyse the economy for more growth and development.

“We have seen it work in many countries like China, India, Indonesia, Philippines, etc. That is the same model they used to reposition their economies and pull millions of people out of poverty,” Obi concluded.

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