Wednesday, 20 November 2013

Article: The Political Economy Of The Nigeria Poverty Rate Discourse

By Jaye Gaskia

My original intention this week was to write a sequel to the piece on the challenge of youth engagement; but i had to suspend that to address something else that has gotten me so worked up in the past few days! Nevertheless in the next couple of days i will still get round to the sequel.

Now to the issue of the moment! Recently the Country Director of the World Bank in Nigeria made a statement with respect to poverty rate in the country that has gotten the Federal Government of Nigeria really truly livid with anger! It was reported that she said that 'of the 1.2 billion people living in poverty globally, 100 million of them are Nigerians'.

Now the presidency has with quite visible anger refuted this statement and dismissed it with disdain! Well, what are the issues involved here?

The first is that the WB CD is even being very generous and economical with the facts! What do the facts say? Facts from government's own agencies? According to the NBS and the CBN, poverty rate was 70% for 2012; while it was 54% in 2004! That means poverty grew in Nigeria over 10 years rather than decline. Again according to the CBN unemployment grew from 8% in 2001 to 23.9% in 2012! And the NBS was very clear that this 70% of the population is 112 million Nigerians!

 What this means is that the WB country director understated the number; it is 112 million Nigerians, according to the National Bureaus of Statistics [NBS] and not 100 million Nigerians who live in poverty!

Government's contention is that this 70% figure is for relative poverty [living on $2 a day]; while the actual figure for abject poverty is 46% [that is living on less than $1.25 a day]! The government further faulted the $1 or $2 a day basis, dismissing this as not only unrealistic, but also simplistic!

So the Presidency goes ahead to give a simple [i will say rather simplistic] illustration; one that says much more about the alienation and aloofness of the government from the realities of existence of ordinary citizens! The government says that $1.25 is about N200, and then contends that no Nigerian or Nigerian family lives on N200 or less a day! They claim that a big loaf of bread costs about N200, and that every family can afford this!

Well, this analysis of the Presidency is an example of poverty of ideas and poverty of analysis! First of all, let us pose some questions? What is the minimum wage in Nigeria? N18,000 per month. How many Nigerians actually get this minimum wage? And how many Nigerians who are working actually earn less than that per month? Let us assume that the average family size is 5 persons, including two adults [the parents] and three dependents. Now even if the two adults earn the minimum wage each, and they now earn a combined 36,000 per month; what this translates into is just about N1,200 per day! For a family of 5 this is about N245 per day per person! Which is still within the abject poverty rate level! What our Presidency does not understand is that not all families can afford the big loaf of bread every day; and that when they do buy the bread, it is shared by the family!

The Presidency further asserted that a plate of food in many neighbourhoods go for the N200 or even higher, and contends that because people buy the food, it therefore means that Nigerians definitely live on more than N200 per day! What warped logic! The presidency assumes that every Nigerian is able to afford the N200 plate of food? at every meal, 3 times a day? It then conveniently dismisses the fact that there are people living on the streets; people who are homeless; people who pick from and eat from dustbins and left- overs? How convenient.

The Presidency assumes that the 10 million Almajiri's live on more than N200 a day? That the 40% of youth, that is almost one in two youth, who are unemployed live on more than N200 per day , every of the 365 days in a year? Let us be clear that this 40% unemployed youth amounts to nearly 30 million youths!

Rather than address the real problem and actual challenges faced by real people; the government exposes its extreme lack of understanding of the problem, and the deep gulf that exists between the treasury looting ruling elites and ordinary citizens impoverished by their actions and inactions.

This way of trying to rig the figures in order to have a more favourable outcome has become the dominant trend in policy making and governance!

Let us use another example to illustrate. The ruling elites foisted a vision 20:2020 on the nation with the objective of becoming one of the 20 largest economies in the world by the year 2020! To achieve this the economy was to have been growing consistently at more than 8% per annum from 2000 to 2020; and because the driver of growth was to be agriculture, the sector was projected to need to grow at 10% annually over the same period. Furthermore, we needed to be generating, distributing and transmitting 40,000 MWs of electricity to power that economic transformation and GDP growth!

Well, what has been our achievements thus far? The economy has been growing consistently at less than 7% per annum, and this rate has been declining not increasing with time; Agriculture growth rate on the other hand has merely averaged about 5% per annum; and we barely generate 4,500MWs of electricity with a transmission capacity that is even less!

So from all indications, it is obvious that we cannot achieve the vision 20:2020 goal and target! And several Federal Government Ministers have said this much.  What to do about this abject failure? The Federal Government decides to rebase the economic and GDP growth criteria. And we have now been told that by the end of the rebasing exercise, without any increase in industrial and business output, Nigeria's economy will overtake South Africa's economy as the largest economy in Africa; and this will happen in 2014!

Like the proverbial ostrich this ruling class, is afflicted with the disease of self delusion of grandiose proportions. So due to a rebasing of GDP calculation methodology; this economy that generates 4,500 MWs of electricity is suddenly going to overtake the South African economy which is powered by 41,000MWs of electricity; just by the stroke of the pen?

This light fingered thieving ruling class has run out of ideas, is afflicted with poverty of ideas; and has become not just a burden on our nation; but also the single most significant obstacle to our National development and growth. It is up to us to pick up the gauntlet, take the bull by the horns, take our destiny into our own hands; and Take Back Nigeria.

 (Follow me on Twitter: @jayegaskia & @[DPSR]protesttopower; Interact with me on FaceBook: Jaye Gaskia & Take Back Nigeria.)

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