Jide Akintunde, Managing Editor/CEO, Financial Nigeria International Limited

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  • Financial Market
  • Fiscal Policy

Lagos should actually not be all welcoming 08 May 2019

The Nigerian population on Monday, April 15, 2019, clocked 200,962,417. This was according to Worldo-meters.info, which uses its proprietary algorithm to forecast the world’s population and also provide real-time estimates. According to its data modeling, Nigeria’s population will grow at an average 2.36 percent annually between now and 2050 to reach 410.6 million. By then, only India and China will surpass Nigeria by population.
    
Is it a good thing that there will be that many Nigerians? It is probably not. The country’s high infrastructural deficits, 45 percent extreme poverty rate, and youth unemployment rate of above 29 percent are warnings against the projected rate of population expansion.

The high unemployment rate puts in doubt the possible realization of the so-called demographic dividend that accrues to a young population like Nigeria’s where the median age was 17.9 years in 2015. On current trends, what is more assured in 2050 is higher social dependency across the population structure. The employed working-age population would be supporting those unemployed in the demographic, the aged and the younger citizens.

Too bad. Official birth control is a political “no-go-area” in Nigeria. When in 2012 President Goodluck Jonathan suggested it may be time for birth control legislation in the country, his proposal was immediately met with cultural and religious resistance. The Nigerian government has more than its match in religion. In effect, the country is politically sleepwalking into unsustainable population.

Rural-urban migration has also been growing at alarming rates in Nigeria. Approximately 104 million people, or 51.9 percent of the population, currently live in the urban areas. However, the urban population will rise to 72 percent, or 295 million, in 2050. If 20 million people live in Lagos today, there will be 48 million residents in the city in 2050, based on the data by Worldometers.

Neoclassical economists support the mobility of labour. Around the world, rural-urban migration has helped to reduce poverty and increase access to economic opportunities. In Nigeria, World Bank data shows that GDP per capita (i.e. the value of a country's economic output per person on the average) rose from $224 (at the current exchange rate) in 1970 to $3,221 in 2014. During the same period, the urban population rose continuously; from 17.8 percent of the total population in 1970, it reached 48.5 percent in 2015.

But the country’s GDP per capita did not grow continuously. It fell from $2,179 in 1981 to $270 in 1993, as oil prices fell from their historical highs. Since 2015, the country’s GDP per capita has maintained a downward trend, on the same factor of relatively lower oil prices.  

This means rural-urban migration depends on favourable market conditions to maintain positive economic trends. In Nigeria’s policy doldrums, however, this pattern of internal migration has led to the neglect of rural economic development and environmental degradation in the cities.

The tell-tale signs are mounting, which suggest that Nigeria’s urban population has become unwieldy. This may have become a significant disincentive to attracting foreign investment in the economy. When a Chicago-based investment banker visited Lagos in 2017, she said that environmental conditions are part of the metrics that are important to her in making investment decisions.

“What is it like with carbon emissions in Lagos?” she asked me during an outdoor cocktail reception hosted by the U.S. Ambassador to Nigeria, as she appeared to smell the air. Savvy investors like her are interested in great macroeconomic data and market size. But they are more interested in markets that combine these with low-carbon development and other environmental and social factors.

Because of, or perhaps in spite of, being Nigeria’s foremost commercial city, Lagos epitomizes rural-urban migration going awry in the country. Vehicular transportation in the city has become unbearably chaotic, not necessarily because of outsized number of vehicles on the roads. The city has attracted and is harbouring a large number of people who cannot appreciate, or learn, the traffic codes.      

In the 80s, young people like I was then, came from the suburban and rural parts of the country to Lagos to acquire higher education and thereafter build a good career. But today, a critical mass of internal migrants thronging the city have a different mindset. They are coming as career Okada riders and Keke drivers, or to engage in various forms of hustling activities that offer little chance of upward income mobility the legitimate way.

Nigeria’s uncontrolled rural-urban drift is making it impossible for our cities to become centres of excellence. The lowest common denominators are falling lower. Those already in for more than two decades are now bound to nostalgic feelings about city life in Lagos, when there was civility, pipe-borne water, and the societal race was to the top.

But what Nigeria has shied away from doing, China has done with astounding success. China strictly controls rural-urban migration. Chinese peasants require permits to settle in the cities. The country regulates the participation of its rural people in tourism to the cities to maintain city-life etiquettes and public decorum. China’s modern Hukou system, which was designed to ensure social, political and economic stability – which are eroding fast in Nigeria – has also ensured a broad-based economic prosperity across the rural-urban spectrum of the population.

Because of deliberate policy, China has been able to lift 800 million of its citizens out of poverty in just over the last five decades. China is reinforcing its economic successes, by investing more in education and infrastructure across the Mainland. Ultimately, Chinese rural dwellers would become more self-advised on labour mobility and participation in the local tourism. State controls will inevitably relax.

It is high time Nigeria embraced economic growth and development by design. This would necessarily include permitting policy dialogue on both population and internal migration. We must boost the productivity of the rural economy by retaining sufficient manpower there and supporting it with social, financial and policy investments. Without this element in a broad economic redesign, the country will not be able to achieve significant improvement in economic performance.

We have moved from effective economic planning in the 1960s and the 70s, to setting development targets and forgetting about them thereafter in the 80s, economic visions that were not implemented in the 90s, and the prevailing absence of vision and planning. It is time for a designer political economy for Nigeria.