CORONA VIRUS: The Underbelly of Non-Manufacturing Economy- Prof. A.P. Akinola

Corona-Corona!
How humbling can humanity be, by a mere microorganism?
My beloved country Nigeria, how prepared are you for this war?
My beautiful continent Africa, what reserves can you muster for this fight?

The war precipitated by the covid-19 health pandemic is a twin-war: health and economic. This is true the more for a non-manufacturing economy such as Nigeria. This pandemic has thrown the informed and attentive citizens into a panic mood, because of the double jeopardy effect it is bound to have should it strike hard here, due to lack in the materials-wherewithal in terms of equipment to manage it, the funding of it and sustainable-financing of the economy, should the scourge prolong. Meanwhile, the countries that manufacture relevant materials to manage the pandemic have announced/placed embargo on exportation; while our mono-economy status is already threatened by cascading crude oil price in the international market, to the extent that devaluation of Naira, the Nigerian currency, has been triggered – just by default!

Why is this so? It does not take rocket science or require any textbook economy or IMF/World Bank tutelage to know that any economy that is weak in production, industrial production/manufacturing, will be so susceptible. Thus, what is the way out? Real sector manufacturing, it is. What is the way to go? No shortcut, go to the basics: make the Ajaokuta Complex, other steel rolling mills, Aluminum Smelting Company and Machine Tools to begin to function post-haste, after victory in this corona war.

This is so because it does not require clairvoyance to know that these are the companies that will kick start meaningfully, functional and sustainable manufacturing; and infrastructural renaissance. Aside from providing enormous primary benefits, they are the candidates to spring up and spin off secondary and derivative companies of medium and small scale status; giving rise to massive job creation.

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Let me confound us or whet our appetite with some of the takeaways that a functional Ajaokuta steel project, paradoxically prostrate even before takeoff and remains comatose till date, could have directly provided the nation at inception: employment of about 52,000 workforce; generation of 110 MW power out of which it only needed 14 MW while the remaining could be sold out; the complementary coke oven would annually produce about 880,000 tons of coke, 48,000 tons of tar, 12,000 tons of ammonium sulphate (fertilizer) and 210,240,000m3 of coke oven gas and 350,000 tons of steam, to mention some. There are other derivative and spinoff companies that naturally emerge from a project of such magnitude, with ramifying implication.

How did Nigeria sink so low, that we did not get this gold mine of a thing to take-off? Is this another symptom or manifestation of what Tatalo Alamu refers to as suffering from postcolonial traumatic disorder? In fact, given the right leadership all this while, what stopped the country to have replicated Ajaokuta (like India, Iran, North Korea and some others did) using local expertise? If Ajaokuta had been functional would the billions of dollar being spent on railway project today not have been reduced many-fold, while the difference would be free to attend to other fundamental socio-economic issues like education, health and others? Wouldn’t the military hardware-manufacturing have benefited from this? Wouldn’t we have been in a position to address our epileptic power challenge, without which no meaningful sustainable manufacturing or entrepreneurship can take place? What of refineries and other assembly plants maintenance and construction? Wouldn’t job creation had been easier, while insecurity better tamed?

In fact, we can imagine what the economic fortunes of Nigeria would have been if it had a functional steel complex. Indeed, looking around the world today we can assess the position of any country with such (iron and steel manufacturing) capability on the scale of human development index (HDI). Then one wonders why a sitting President could not relocate its presidency to an Ajaokuta for a period until functionality is ensured. If the government of President Buhari that came to governance on the mantra of change had done so at inception of its regime in 2015, the country would probably have been in good stead battling not only Boko Haram scourge, but also be in a more composed form confronting the on-going covid-19 war.

In encapsulating the general frustration of the public over Ajaokuta, a newspaper in 2019 lamented, “Nigeria had expended well over USD 5 billion without it coming to fruition.” What a further nudging that Nigeria earnestly needs to get out of rent-seeking, rent-collecting economy; but frog-jump into the league of a manufacturing and thriving economies: industrialise, manufacture, acquire technical expertise in benefication of its raw materials to enhance manufacturing and stop being a dumping ground? What is more, a country that is adept in steel production will attain mastery of aluminum production and effectively realise an uninterrupted power management.

Well, it is not too late to so do, in the remaining 3 years or so of the lifespan of this regime. Corona has come, and it will go. The dire challenge of managing the economy of Nigeria will not run away. It is cheery news that President Buhari signed with President Putin a memorandum of understanding (MoU) for the completion of Ajaokuta complex, during his visit to Russia in October 23-24, 2019 for the Russia-Africa Summit in Sochi. This is courageous and highly commendable of the President. But then, one hopes that in this renewed move, Nigeria will walk-the-talk, promote competence, shun nepotism, wear every sense of urgency needed to bring this to fruition.

Exhibiting an equal patriotism and political will with which the implementation of BVN and TSA was commenced, it will be a lasting legacy for posterity if President Buhari would summon the courage to relocate presidency to Ajaokuta immediately after this COVID-19 battle; for Nigeria to attain the capacity to take charge of its economy and pave the way to joining the league of manufacturing, industrialised nations.

-Prof Adegbola Akinola.
(Obafemi Awolowo University | OAU · Department of Mathematics)

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