THE federal government has presented the 2022 Appropriation to the National Assembly for consideration. Tagged:”Budget of Economic Growth and Sustainability”, the provisions if religiously implemented will advance the general wellbeing of the masses.
It is apposite to note that the revenues from the oil sector is dwindling and to that extent, it has become necessary to re-evaluate and initiate policy on the inflow of foreign direct investment with a view to enhancing the prospects since it has greater potentialities for massive employment and transfer of technology.
The need for a creative way to enhance increased inflow of foreign investments is underscored by the whooping N6.26trillion deficit in the budget taking into consideration that the total revenue available to fund the budget is put at N10.13 trillion. This is a scary scenario which is totally unsustainable for overall health of the national economy. Apart from the need for increased inflow of foreign direct investments, it has become an increasing necessity to embark on realistic diversification of the economy in line with global best federalism practices. In other words, realistic diversification of the economy is inextricably tied to the massive devolution of powers (restructuring of the federation) to enable the sub national governments to explore and exploit the abundant natural resources lying wasting in their respective jurisdictions to create vast production opportunities that inexorably go with massive employment generation, wealth and de-escalate the blossoming and pervasive unemployment that lead to frustration and exasperation of the country’s able bodied youths. Putting it in another way, there is urgent need to abrogate the rigid federal laws on exploitation of natural mineral resources which has to do with restructuring the federation to restore true fiscal federalism. It is bad policy to abandon the exploitation of these mineral resources which the sub national governments can adequately handle instead of loading the exclusive legislative list with issues which the sub national governments can conveniently handle to jumpstart the economy for the benefit of the generality of Nigerians. It is apposite to note that diversification of the economy has not been effected under the subsisting quasi federal system of governance. A situation where the Central Bank of Nigeria (CBN), under its Anchor Borrowers Programme does not amount to diversification of the economy through agriculture as people are led to believe.
The restructuring of governance is the reasonable road to follow because the unending borrowing amounts to mortgaging the future of the country and present generation even as the binge borrowing since 2015 has by ocular proof not impacted positively on the lives of Nigerians.
According to IMF report, Nigerians have grown poorer and still remain among the lowest in terms of revenues globally even when it has described as the “poverty capital of the world. With Nigeria’s over-reliance on crude oil earnings to fund the budget, government may be stretching itself too thin in generating sufficient revenues to fund critical infrastructures which impinge directly on the productive sectors of the economy. And with the increasing borrowing, the future of the country is bleak.
Massive devolution of powers will enhance more investments in the non-oil sectors of the economy by the sub national governments. In addition to that, the sub national governments will embark on diverse sources and creative ways conducive to their environment to create wealth through competitive federalism that was in place in the first republic.
Above all, government must tackle insecurity across the country; the spiking insecurity has become a potent disincentive which has been hampering local investments and more especially agriculture in addition to massive inflow of foreign investments.
Restructuring of governance will definitely deescalate the rising insecurity which is a major concern to potential local and foreign investors. Restructuring will equally tackle the pervasive infrastructure deficit which the federal government has been trying in vain year in year out in the budget to contain. For instance, if the sub national governments are allowed to invest in electricity generation and distribution, the high cost of production occasioned by epileptic power supply, policy somersaults, multiple taxation and political uncertainty will be a thing of the past as observed in countries that operate true federalism.
It is incontrovertible fact that no investor goes to where the prospect of making returns on investment is not bright. Substantial devolution of powers is unarguably at the top of the government’s incentives that will encourage foreign investors to jumpstart sustainable growth in real terms and generate more revenues to start repaying the unsustainable foreign loans rising to high heavens. Altogether, Nigeria needs a new blueprint for industrialisation and mobilisation of investment inflows into the country to reset the already dwindling and patently comatose economy.