 Planning a better utilization of resources
Nigeria recognises that the global trend is geared towards a leaner government and efficiency in the utilisation of resources. But the past has a strong grip. According to Nigeria's institute for policy and strategic studies. There are currently over 300 federal parastatals and the system has become ineluctably resulting in conflict of roles, duplication of fuctions and available waste of scarce resources. Although the parastatals were created in the first place to ensure quick implementation of government policies and projects, this objective is not being achieved as a result of bureaucratic bottlenecks, poor management and corruption.
Most of the parastatals are in need of restructuring to adequately perform their statutory roles. Most parastatals are inadequately funded and this hampers their operations. Vandalisation and theft of vital equipment is a common feature of many parastatals especially in the energy and transport sectors. Among the many reasons given by the various parastatals for their poor performance was the claim that they are harmstrong by the supervisory ministries. The objective is now to improve the utilisation of manpower across the board in the public sector in order to increase productivity.
These expectations have yet to materialze because people are still skeptical of the current operating environment and afraid of reversals. Besides, there are still a number of bottlenecks including such as a tariff regime incongruent to Nigeria's industrial developmental needs, too much bureaucracy arising from the need to regulate in the absence of clear laws and requisite institutional channels of governance. All the impediments highlighted above and much more, and the solutions to them, together with the strategies to jumpstart the economy and take it to greater heights, were fully articulated at the Vision 2010 Committee. The Vision 2010 report reflects the collective wisdom of all stakeholders in Nigeria. The Committee developed a vision of a great Nigeria, which was expected to be the leading industrial nation in Africa by 2010 at which time the Nigerian Republic would have attained its 50th anniversary as a nation, hence the choice of that year as a landmark. It also produced a blueprint of strategies for translating the shared vision into reality.
Where past development plans spelled out projects for public sector funding, the present document mainly emphasises strategies and targets for liberalisation of the economy.
The Economist Intelligence report projects a sustained economic growth rate for Nigeria in the next four years inclusive of the current year.
Gross domestic growth rate is expected to exceed the population growth rate as from 2001, a standard which was last attained in 1997. The growth rate of 3.8 % attained in 1997 is expected to be matched by 2001. | President Obasanjo said the compelling demand for efficient social services at affordable prices, coupled with government's dwindling resources convinced him that privatisation is the path to take. "This administration sees no other way", he said.
Underguiding the privatisation imperative is a market, oriented macro-economic framework. With an independent Central Bank, the country's exchange and interest rates are now fully market-determined. Where past government's profligacy has fuelled galloping inflation, Obasanjo has proved to be a cautious spender close to achieving a single digit inflation rate at the same time that he is committed to refloating the economy so as to boost employment.
Among Nigeria's economic aspirations is the creation of a strong economy that is private-sector driven with the government as enabler. The country seeks to enhance the exploitation of its hydro-carbon, agricultural, mineral and tourism resources.
Also, the country wants to promote entrepreneurship and competition within the ambit of fair, equitable and enforceable laws. Nigeria intends to make massive investment in education, health, technology and infrastructure. Its industrial policy aims at export-oriented production as against the import substitution strategy of the past. The country's two-prong approach to having a vibrant private-sector is through promoting indigeneous entrepreneurship and opening up the economy to full participation by foreign investors.
The foreign exchange market has been deregulated while there is no longer any limit to the share of a business that foreign investors can own. Endorsement for Nigeria's current economic policy thrust comes from the World Bank which is funding a US$ 40 million worth of technical assistant for the privatisation programme, in parallel with the process on Country Assistance Strategy (SAP). Also the International Monetary Fund has a staff monitored programme in place. To get major parastatals primed for efficiency ahead of privatisation, their chief executives have been replaced since Obasanjo came in.
With budget 2000, tariffs on intermediate inputs have been reduced as a way of boosting domestic production. The government seeks to revive agriculture and industry as key areas of employment and productivity growth.
Rebuilding the Nigerian economy and enhancing productivity was the theme of the sixth annual Nigerian Economic Summit which the government organised in conjunction with the private sector in October 1999. At the summit, President Obasanjo said: "Through privatisation, deregulation, liberalisation and the re-orientation of the bureaucracy, we shall create the enabling environment for investments. We shall pursue stable macro-economic policies including a market-determined exchange rate and lower interest rate".
The government expects to attract US$ 10 billion, in investments per year into such areas as oil and gas, petrochemicals, infrastructure, agriculture and agro-allied industries. "If there is anything for us to do, we will do it to encourage foreign investment", said the chief economic adviser to the president.
So, the government is removing bureaucratic bottlenecks and various impediments to trade and investment. As business delegations from various countries are discovering the new democratic order is changing Nigeria's business environment. |
