In Q1 2021, Nigeria spent 66% of all imports on manufactured goods; that was N4.5 trillion. On export, about 66% of exports went for crude oil but our receipt was only N1.9 trillion. The implication is this: unless we have import substitution for manufactured goods, our balance of trade will not be good. In other words, there is a high level of imbalance in the balance of payment, and that imbalance is the reason Naira has hit N500/$ in the black market.
How do we solve this problem? I will examine China which is our biggest challenge on trade. Yes, we need to buy less from China, and doing that means we need to make many things we buy from it.
A simple idea we can execute is what I have called “180 Build Plan” which means within 180 days, we can provide 24/7 electricity in six cities in Nigeria (Aba, Osogbo, Uyo, Jos, Potiskum, and Sokoto), by working with renewable energy companies, with backup from Tesla batteries, guaranteeing electricity. We have a real chance of getting light manufacturing up and running.
Tekedia Mini-MBA edition 16 (Feb 10 – May 3, 2025) opens registrations; register today for early bird discounts.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
How do we fund it? Disband N-Power initiative and use the money to provide this electricity. Over time, Nigeria via the private sector will hire more permanent people than give graduates $60 monthly for largely nothing. Then, from these 6 cities, we keep ramping things up.
Ladies and gentlemen, only factories and warehouses (modern and old which include startups, digital, cement, noodles, etc firms) will fix Nigeria’s paralysis as it is easier to cut our import of manufactured goods than improve our export of crude oil.
image credit: Chukwuemeka Nwagwu Bsc, Msc---
Register for Tekedia Mini-MBA (Feb 10 - May 3, 2025), and join Prof Ndubuisi Ekekwe and our global faculty; click here.
The country lacks direction, so no one is mobilising citizens for critical national assignments. We just have a disproportionate size of young and energetic people trading coins and another bunch looking for who to scam online; yet this a country that barely manufactures anything.
Then add government policies that favour welfare distribution over productive ventures, that’s why they don’t see anything wrong in voting hundreds of billions in their so called ‘social investment scheme’, things that only encourage consumption. You share N30k to hundreds of thousands of youths, in the name of employment scheme. How does that improve our national productivity index?
We devote excess time thinking about survival, rather than growth and development, and the only thing you achieve with the former is a perpetual life of struggle, with no chance of self-sufficiency.
We have workable frameworks that can turn the situation around, but we must be willing to make both the financial and moral commitments necessary; else the wailing will be forever.
This analysis confirms one of Adam Smith principles which states that, “by affording a great and ready market for rude produce (manufactured produce) of the country, they gave encouragement to its cultivation and further improvement.”
Beautifully presented!