By Biodun Jeyifo
(A copy of the talking points of the lecture came to me only a few days ago. I am talking of a lecture delivered earlier this week by Dr. Andrew Nevin, Chief Economist of PricewaterhouseCoopers, Nigeria (PwC), at the 80th birthday party for Pascal Dozie, founder of Diamond Bank, Chairman of the New Nigeria Foundation and one of the most successful investors and corporate personalities in Nigeria. Indeed, only at a social function for such an icon of Nigerian venture capitalism could a talk of such far reaching consequences have been given. More of an informal talk than a lecture as such, what Dr. Nevin had to say will come as a bracing revelation to any thinking Nigerian who gets to read it. For this reason, my discussion of the talk in this piece is intended to provoke the publication, in full, of the talk. I swear that in my discussion, I have tried as much as possible not to distort, not to either overstate or understate anything that Dr. Nevin said in his talk. At any rate, I know for a certainty that this will not be the only commentary or the last word on the talk, at least once it is published. Finally, the talking points of the talk that I discuss in this piece were circulated at the party for Dozie; they are thus already in the public domain]
Of the five talking points discussed in the lecture, I will discuss only three in this piece. These are: remittances from Nigerians in the diaspora – not oil revenues – as our most important source of revenue and the only thing that is keeping Nigeria from economic collapse; the relentless and seemingly unstoppable shrinking of the public sector in our country in the last few decades; the self-organization and tremendous resilience of the informal sector of the economy. These issues are discussed separately in Andrew Nevin’s talk, but that they are all interconnected is something that becomes evident after one has read his observations and reflections on all of them.
If it is true that facts and data don’t lie, then consider the significance of the following data. In 2018 – which happens to be last year – remittances from the Nigerian diaspora totaled US $22 billion. Oil revenue for the year remitted to the Government by NNPC was, at US$11 billion, less than half of the remittances from the diaspora. Meanwhile, the estimate of remittances from the diaspora for this year is US$25 billion. Beyond these, consider the fact that data for unofficial remittances through the informal, so-called “Aboki” system are not included in these official data; when they are included, remittances from the diaspora are close to US$40 billion. This staggering sum is more than triple what the NNPC remits to the Government annually.
Remember, compatriots, that our national currency, the Naira, is among the so-called ‘“non-convertible” currencies of the developing world. Thus, we badly need for our revenues from oil to be in dollars, the first among the convertible currencies of the world. With this in mind, think now of the significance of the fact that not only are remittances from the diaspora almost triple oil revenues, they are in dollars and are thus crucial to the volume of FX or forex available for exchange and circulation in our national economy. In other words, far more without the remittances from the naija diaspora, our national economy would be so short of forex that it would sooner or later, sooner than later, collapse.
Why do we keep on regarding oil revenue as our main or primary source of revenue, especially revenue designated in forex? Why are we so extremely slow to recognize and deal with the fact that our main primary export is not oil but people? Is it because we do not normally think of people as exportable commodities? Nevin believes that it is because the change from oil to people as our main export item happened so gradually and imperceptibly that we never really became aware that the change was happening or has, indeed, been irreversibly consummated. However, while it is one thing to become aware of this momentous change in the structure of our national economy, it is another thing entirely to decide the terms in which we should conduct a productive national conversation on it. I shall come back to this point later in this piece after discussions of the other two issues earlier indicated. For now, let me make this preliminary observation: Nigeria is not the only country in the world wherein export of people, of nationals has become a major, if not the primary export commodity or item. This situation is indeed similar to or congruent with the experiences of many other developing countries of Africa, the Middle East, South Asia and Latin America.
With regard to the second issue – the relentless shrinking of the public sector – I must confess that although I was very aware of its occurrence, I simply had no idea that it was as catastrophic as the figures and data supplied by Dr. Nevin imply. Here’s one statistic: between 2000-2002, public sector expenditure in Nigeria averaged 25% of the GDP; in 2017, public sector expenditure, at N13.2 trillion naira, was only about 12% of the GDP. Since N1.3 trillion of that sum went into debt servicing and the National Assembly alone cost us N125 billion naira, it means that only about 10% of the GDP was spent for public expenditure. Here is another stat, a monster of a stat: 10% of the GDP for public sector expenditure works into about N70K per capita – which means that only N70,000 (seventy thousand naira) per person was spent at all levels of government in a whole year for everything, including health, education, public sanitation, infrastructures and utilities, policing, armed, security services and social welfare services. This is one of the worst figures for per capita public sector expenditure in the world.
The severe shrinkage of the public sector means that for the most part, in the last few decades, what the public sector no longer provides Nigerians have had to provide for themselves – and this also includes nearly everything. This observation leads to the third of the three issues discussed by Dr. Nevin in his talk that I wish to discuss in this article. Let me remind the reader what this is – the self-organization and tremendous resilience of the non-governmental, informal sector. Logically, this arises from the shrinkage of the public sector with the attendant monumental decrease in what the government, the public sector actually can and does provide for Nigerians in their millions. After all, nature abhors a vacuum, right? Yes, but this is more than merely filling a vacuum; it is nothing short of a true measure of what Nigerians can do in the face of the great challenges that they face day in, day out. This section of Dr. Nevin’s talk is simply the best part and by a long shot.
In Nigeria, people are getting poorer and poorer, the government and/or the public sector provides an absolute minimum of services needed for a modern society and the little that it provides is grossly inadequate; moreover, life is full of insecurities and the young are restless and desperate. By all rational calculations, Nigeria should be a failed state, a collapsed society. But it isn’t. Nevin asks why and he says it is primarily due to the great resilience of the informal sector which turns out to be doing for oneself what the government or the formal sector cannot or will not do. This is of course not the first time that our informal sector has been praised for doing what the formal sector, the public sector cannot or will not do. What makes Dr. Nevin’s take on the issue so compelling is the fact that his profile of the informal sector is juxtaposed to his stunning account of the shrinkage of the public sector. After all, against white, black appears more black and white itself more white. In other words, if we didn’t have the tremendous ingenuity and self-organization of this informal sector, if all that we had was the gross insufficiency and the mediocrity of the formal sector run by the government, Nigeria would long ago have gone the way of so many other nations of Africa and other parts of the developing world where, again and again, the nation has proved to be a limit beyond which the people cannot go. In Nigeria, according to Nevin, things seem to be going in the other direction: the people constitute the tremendously unbounded limit against which the nation must be measured.
In bringing this discussion to an end, I wish to extrapolate some logical conclusions of Dr. Nevin’s talk that he does not make himself, even though they are, in my opinion, crying to be made. In his talk, not the government, not the leaders and not even any segments of the social and political elites but the Nigerian people themselves, at home and in the diaspora, are the real heroes. Although it is Nigerians in the diaspora that are deliberately singled out for hero-worshipping by Nevin, he comes near to expressing the same sentiments in his comments on the informal sector. Based on this, the whole talk seems to be framed by an unspoken but palpable Nigerian exceptionalism. Since we do know ourselves that we are prone to uncritical exceptionalism when we think of or talk about our destiny on the African continent and indeed, in the world, we ought to be wary of it when it is being argued by a foreigner who has evidently been mesmerized by a heavy dose of naijaphilia.
Such caution is all the more necessary given the fact Nevin seems almost completely oblivious of neoliberalism as the global and historic context for all his claims and reflections in his talk. People becoming our primary export “commodity” to displace oil from that august position? The unending shrinkage of the public sector? The informal sector coming to the rescue in the wake of the collapse, the chaos and mediocrity of the public sector? Not a single one of these happened without the overdetermining savage war of neoliberalism against the nations and peoples of the world, principally the peoples and nations of the developing world at first but later on all the nations and peoples of the world. We became a debtor-nation or a debt-ridden nation thanks to neoliberalism. Everything else followed from that historic fact and datum. Of course, don’t blame it all on neoliberalism; but don’t excuse neoliberalism completely from blame either.
▪ First Published by The Nation newspaper on June 30, 2019.
