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Wednesday, May 18, 2022

Towards poverty reduction

Bayo Fasunwon

Nigeria is at a precipice. Whether we acknowledge it or not, the people are getting poorer daily. A Professor friend of mine once lamented that what he earned as a Senior Lecturer, that was about twelve years ago had more purchasing power than what he now earns as a Professor.  In other words, he cannot purchase now, what he used to acquire debt free, few years ago.

Many have laid the blames on the doorsteps of government, and the accused have wondered how they should bear the blames of economic interplay of global events. The Presidency has often wondered that with the tradermoni, farmermoni, free school children feeding programmes, welfare packages for the ‘vulnerable’ and the minimum wage, ungrateful Nigerians are still blaming them, for being so magnanimous and  benevolent. From statistical analysis, Nigeria is getting richer while Nigerians are getting poorer. That is an irony.

The nation’s wealth, in real terms is the people. Therefore, any nation that is desirous of national wealth must invest in the prosperity of her citizens and inhabitants. The cumulative, spill over and circulating wealth of the people would inform the prosperity of the nation as a whole. Many European nations are so aware of this truth that they operate economic systems that seek to increase the purchasing power of their people. That explains the provision for credit cards, as against our debit card system.

The credit card system achieves two objectives. In the first place, manufactured goods are not left fallow on the shelves gathering dust, where no one would be able to purchase. Therefore, manufacturing industries, and other stores are able to have turnovers which ensures that the economy in never grounded.

Therefore, in times of economic depression the citizens are not left groaning for lack of sales. As long as sales are made, cash is made available to invest in other ventures. In the second place, the credit system also ensures that value added tax on purchased goods are frequently accessed and harnessed by government. In addition, tax generated from the issuance and use of credit card improves the national income.

Technically, the debts owed by government are also made available to the people to borrow from, invest, and create streams of income to the people.  Furthermore, government invests in their security personnel and equipment in order to ensure the protection of individuals and organisations. If the stories we hear are anything to go by, citizens are secured in carrying out their entrepreneurial ideas.

Furthermore, the availability and access to social amenities, good learning systems, and conducive economic policies enhance creativity and inspirations for higher output. Then, credit facilities for entrepreneurial endeavours with reduced stringent conditionality are often in place to ensure that small funding are available to promote the development of small ventures which would later metamorphose into bigger investments.

All these structures and programs were put in place in order to enhance the ease of doing business and therefore attract foreign direct investments in the form of cash flows, location of industries and technology transfer.

Among 190 economies, Nigeria has moved to 131 in its EDB ranking in 2020. While the Federal government celebrates this feat, it is still very different from liberal, proactive economies, which occupy the single or double digits positions.  However, while government is placing the cart before the horse in seeking for foreign investors, other nations had sacrificed national income in creating the environment that promotes the prosperity agenda of their people. In other words, government has not weaned itself from the ‘import mentality’, which in the end impoverishes rather than enriching the nation.

In African politics, politicians are united in their wrong belief that the best ways to ensure followership is by sustaining the poverty of the people. The belief is that poverty makes people easy to lead, and easy to buy. That explains why salaries are delayed, and monies are withdrawn months before elections. With hunger pervading the land, persuading people to shun peanuts in exchange for their votes, is like a camel passing through the eye of the needle. While it is easier to access bank loans for buying consumables, it is a herculean task assessing funds for entrepreneurial ventures.

This explains the rise of online loan sharks who denigrate their creditors anyhow. Beyond these multiple taxations and high interest, rates also eat into Entrepreneur’s investments, hampering expansion of such enterprises. It is needless to reiterate that bad roads contribute in no small measures to mobility of labour, materials, and finished goods, thereby limiting the markets for these goods. The spate of insecurity on the roads, on the farms and even in the market place has become an albatross in the nation’s quest for national prosperity.

The fact remains that the informal sector is the foundation for the development of other sectors of the economy. There is the need therefore to develop this sector of the economy through favourable monetary policies set out to empower them for expansion and prosperity. Government should as a matter of urgency change their one sided development agenda.

The agenda of the ruling class, which is manifested in their bid to create limed number of millionaires in an environment of crashing naira, is appalling. The need therefore arises for the resurgence and revitalization of the middle class as a bridge for ascendancy and enrichment of the lower class. Government policy must therefore consciously on how to make Nigerians rich. Rich, in the context that an average Nigerian would be able to access the basic needs, and the enterprising ones should be able to develop their businesses for exports and  hence unemployment reduction in the land.

The existence of myriads of slums in the perimeters of mansions is a signal of a very poor economy. As long as durable wealth is still a mirage for majority of Nigerians, the nation itself would continue to wallow in poverty. As it is now, with increass in price of goods and services, even traders are lamenting on low sales and patronage. As goods continue to expire, corruption would come in through repackaging of products, and inferior goods would flood the market, creating more health hazards and avoidable deaths.  Soon the poor would feast on the rich, and undistributed wealth would become trash. Now is the time to make our banks a helper of commerce rather than been Shylocks and Sharks. Nigerians have exited the ‘managing’ level and are seeking to hold to the ropes of survival. A people oriented government, which believes in the enrichment of her people, as the trigger of national development is vital and non-negotiable.

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