The Governor of Ebonyi State, Chief David Umahi, on Tuesday expressed optimism that with proper investment in both physical and human developments, Nigeria’s economy can still survive without relying on oil.
Umahi, who was a guest lecturer on the occasion of the 59th Founders’ Day Lecture of University of Nigeria, Nsukka, gave three reasons Nigeria needs to pursue zero oil economy include: to insulate the economy from the risk of being vulnerable to a single commodity, to create jobs that can raise the living standard of an average Nigerian and prepare for life beyond the oil revenue.
In his lecture entitled: “Preparing Ebonyi State for zero oil Economy” Umahi stated that “In Ebonyi, we are laying the foundations for sustained economic growth and prosperity in our state, beyond the era of oil.”
He said: “There are probably 3 reasons Nigeria needs to genuinely pursue zero-oil economy or diversification: First is to insulate the economy from the risk of being vulnerable to a single commodity, as the different oil prices crashes have shown.
“Nigeria’s economy potentially lies beyond oil. In 1960, Nigeria had a leading position across several of its export crops especially groundnut, cocoa, cotton and palm oil. At that time, its share of the World Agriculture exports was in excess of 1%.
“By the mid 1980s however, Agriculture exports collapsed as the country shifted towards petroleum exploration and by the 1990’s, Nigeria’s share in World export of Agriculture had declined to less than 0.1%.
“This over concentration on a single commodity creates deep fault lines within the economy, as global oil price crashes travel through all facets of the Nigerian economy. Nigeria’s oil resources should be used as a down payment to build a robust diversified export basket of other products – to create jobs, earn foreign exchange and attract investments.
“Essentially, Nigeria must “use oil to move beyond oil” our large population of 180 million people means we do not have enough oil to meet the needs of all our citizens. A lower Nation with a lower population than Nigeria has oil reserves of 9,900 barrels per person (for each citizen), Saudi Arabia has 9,241 barrels per person; while Nigeria has only 214 barrels per person.
“Within the top 20 exporters, the non-oil exporters tend to be richer, have faster growth rate, and have economies that are more resilient. Nigeria therefore cannot expect to only stick to exporting oil, and become a major economic engine, or deepen the size and resilience of its economy.
“To transform Nigeria’s export agenda, the Zero oil vision lays out the partway for Nigeria to earn at least 20 percent of its GDP from non-oil export, or approximately USD 100 Billion.
“The zero oil vision will require scaling up production in the country to unprecedented levels, and creating the necessary sourcing and marketing mechanisms to get Nigerian goods into foreign markets at competitive quality and price.
“Developing countries in East Asia have been the best performers over the past decade, and witnessed the fastest export growth globally in implementing the zero oil plans. Nigeria should leverage her experience from East Asia and adapt practices that have worked to our specific situation.
“There are great opportunities for non-oil sectors to grow and this growth has been visible since 2001. Of course, the changes cannot be that quick and the transformation cannot happen overnight.
“Independence of businesses and private sector participation in economic development, Reduction of the involvement of the government in economic production, Introduction of new opportunities instead of relying on traditional sectors only, Human Capital Development through education, capacity building and empowerment.
“Ladies and gentlemen, given that the most prosperous nations in the world are not dependent on oil, it is clear to me that, with proper investment in physical and human development, Nigeria can survive without relying on oil and may even grow faster.
“One way to do this would be to ensure that all revenues from oil are applied only to infrastructure development. It is sub-optimal for Nigeria to be using its oil wealth to fund recurrent expenditure. This promotes a dependency culture that stifles innovation, creativity and productivity.
“In Ebonyi, we have started preparing, as Confucius advised. The journey will be a long and difficult one but we are laying the foundations for sustained economic growth and prosperity in our state, beyond the era of oil” stressed.
Earlier in his address, the Vice Chancellor of University of Nigeria, Nsukka, Prof Charles Igwe who welcome the Governor to the Institution of learning stressed the need for collaboration between the University and the state government towards the achievement of zero oil economy for the state.
” I have chosen to publicly thank you for so readily obliging our request to be the guest lecturer at today’s event. Am aware that this is your first official visit to the University of Nigeria.
“As you can tell, you have many admirers at the University of Nigeria and the good job you are doing at Ebonyi state has not gone unnoticed. I hope, however, that there would be many more visits.
“Our Founders’ Day Lecture remain the most prestigious of the public lectures that take place at the University of Nigeria. It is an ideal platform for discussions on topical issues of national and international relevance. Thus, it is not only about celebrating the past, but also about preparing for the future.
“I am sure that reducing our dependency on crude oil will require a lot of research in policy and technological innovations. It is my desire that some of the required research in policy and innovations can be done here at the University of Nigeria,” he stated.
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