Jide Akintunde, Managing Editor/CEO, Financial Nigeria International Limited
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The blind sides of governance in Lagos 13 Jan 2017
Lagos State Governor Akinwunmi Ambode is an “action governor.” In the course of the campaign for his election in 2015, he created a momentum for his support with a picture in which he rolled up his shirt sleeves, depicting his readiness to work for the people of Lagos. Before that point, he had cut the image of a leisurely man, who was in love with the superfluity of the Yoruba traditional four-piece agbada attire.
Governor Ambode has since his inauguration swung into action. He has been attending to some exigent needs of Lagosians. Some of his actions include dealing in rice distribution on behalf of Lagosians, organising carnivals, extending the lay-bys of major roads, and building pedestrian overhead bridges. But Lagos that will transform into a modern city requires more than superficial actions. The challenges of the transition are quite enormous.
Lagos is generally rowdy. There is hardly any part of the sprawling city that escapes its rowdiness. Around Alausa, seat of the government, traffic is always chaotic, including when it is light. For instance, the commercial auto rickshaws (keke Napep) are seemingly excluded from observance of traffic signs. So they run the red lights even as traffic officials watch on. The anomalies persistently displayed by the other road users, within a stone’s throw of the office of the governor, demonstrate the general absence of civic enlightenment in Lagos amid the helplessness of the authorities.
Lagos is unsanitary. Although the government has been responding to the need for better waste management in the city, residents continue to dispose their refuse indiscriminately. With rapid urbanisation driving overcrowding, homelessness and poor sanitary practices, Lagos remains one of the major commercial cities of the world where residents practise open defecation, which pollutes the air, contaminates surface water, creates an eyesore and spreads diseases. With its mainly uncovered gutters, the ugliness of Lagos is on display during and off the rainy season. The unsanitary conditions of the city drills down to the homes, driven by the perennial inadequate water supply.
Lagos lacks modern infrastructure. The city is either noisy – from the sounds of generators – or in darkness, owing to the scanty supply of grid electricity. Much of the paved roads in the city are pothole-ridden. The reform of public transportation, which began about a decade ago, has so far delivered a makeshift bus rapid transit system. Projects to deliver improved level of modernisation in the transport system have been behind schedule by a few years now. As such, Lagosians are long-suffering people, enduring great difficulties when commuting.
Lagos is a city of the urban poor. This is in spite of the contribution of the city to the growing population of the Nigerian middle class, and despite being home to Nigerian billionaires. Any sense of economic progress in Lagos is neutralised by the large population of longstanding residents and new migrants from around the country, who are without adequate education, skill, and entrepreneur-ship beyond running trades on the streets and decrepit shops. Thus real opportunities for wealth and employment creation are limited than the large, boisterous population would suggest.
To further compound the troubles of doing business in the state, businesses have to pay multiple taxes and also suffer harassment from the local government tax officials. All this, invariably, discourages business formation and inhibits enterprise growth in the state.
And, as a consequence of the above, Lagos is not a “centre of excellence” as it is claimed by its moniker. Even worse, the hope of Lagos of excellence is diminished by mostly poor quality educational standards in the state. Lagos State University is not one of the top-ten universities in Nigeria (National University Commission Ranking 2016); and no university in Lagos is among the top 15 in Africa (Times Higher Education 2016). The quality of the public elementary and secondary schools in Lagos fails to meet informed expectations of the commercial capital of Africa’s largest economy. This will only herald a future Lagos that is populated by social misfits.
Lagos enjoys gratuitous advantages of a former federal capital. Until the seat of the federal government moved to Abuja in 1991, Lagos combined the privileges of being the political and commercial capital of Nigeria. The three bridges linking the Lagos mainland with the island were built by the colonial and federal governments. Without the legacy infrastructures including ports, rail lines and the longest paved roads, which Lagos inherited from the colonial and federal governments, the inadequacy in the governance of Lagos State would have been further exposed beyond what has been self-evident.
Riding on the historical public investments and taping the large population, private investments have accelerated the Lagos GDP to $90 billion (27.5 trillion). With this, the Lagos State Government (LASG) generates estimated $82 million (N25 billion) in monthly internally generated revenue (IGR), mostly tax incomes. This supports the viability of the state. But in spite of the high IGR, Lagos is dependent on further private sector donations to provide security, support employment generation, and deliver its substandard public education.
A dilapidated public school building in Mushin, Lagos.
High revenue has hardly motivated the government to embrace serious reform in order to deliver better services to individual and corporate Lagosians. Even in its bread and butter area of taxation, Lagos is not a pacesetter in the country. It takes two days to register for personal income tax payable to the Lagos State Internal Revenue Service, while it takes half the time to register for income tax and VAT payable to the Federal Inland Revenue Service, according to World Bank’s Doing Business report 2017.
Lagos’ IGR has been markedly leveraged over the past few years. Without any public-funded major infrastructure project already delivered, Lagos State’s external public debt has risen quite sharply above subnational trends. According to the Debt Management Office, Lagos’ share of Nigeria’s subnational foreign debt of $3.65 billion, as of June 2016, was $1.4 billion or 39% of the total. The state’s local debt stock of N218 billion was the second-highest among the states, according to DMO’s figures for December 2015.
The combination of Lagos’ high IGR and public debt is incongruous with a state that has inadequate infrastructures, and where residents have to provide for themselves water, while public schools are substandard. But the state government often distorts this reality by touting narrow narratives on the relative economic stature of the state.
Nevertheless, Lagos remains a place of real possibilities. The population is youthful, representative of Nigeria’s demographic advantage. Lagos also harbours substantial ethnic and racial diversities – although it would appear it does so half-heartedly. Lagos’ diversities support any aspiration the state has to be a centre of innovation.
As Governor Ambode notes, Lagos is poised to become the third-largest African economy, were the state a sovereign. The Lagos State GDP is already the biggest in Sub Saharan African, minus South Africa and Sudan. Lagos’ large population of estimated 20 million is a boon for consumption. Local and multinational businesses investing in FMCGs have substantial opportunities to grow. High brands can also leverage the sophisticated taste of Lagos’ affluent and upper middle classes.
Growth in commerce is supported by the substantially developed Nigerian banking system. The indigenous and local subsidiaries of multinational banks in Nigeria have their headquarters in Lagos. And given that Lagos remains the most advanced amongst Nigeria’s cities, the nation’s best-trained and experienced manpower and returnees from the diaspora mostly reside in the city. This has been driving an active real estate market. Indeed, much of the potential for real estate expansion, which lay in redevelopment, is currently almost infinite in Lagos.
Lagos harbours several growth industries within its services sector. The liberalisation of education in Nigeria has provided opportunities for private sector investment in the educational sector. But demand for high quality education by well-to-do Lagosians remains unmet. Given the need to build prestige into education in Lagos, the opportunities for investment in quality educational institutions, including first-world universities, are still waiting to be tapped.
Substantial investment opportunities are also in the health sector. A significant proportion of the estimated $3 billion spent annually in medical tourism overseas by Nigerians comes from Lagosians. While in recent times the Lagos State Government has invested in medical education as well as upgrading its healthcare facilities, these efforts are significantly short across the levels of demand for healthcare in the state. As an example of potential returns on private investment in Lagos healthcare, the health diagnostic facilities setup by the Indians are enjoying tremendous patronage. Patients are on long queues daily at the facilities.
Modernising Lagos requires the government to set new priorities. In the meantime, the policy-thinking in Lagos is pretty much dominated by physical infrastructural development. But a city cannot develop by leaving its people behind. A modern Lagos would be fundamentally defined by the enlightenment of its residents.
One basic reason the Lagos State Government should invest more in public education and enlightenment of Lagosians is that it is the most effective strategy to foster public order. For the government to be able to enforce traffic regulations, for instance, the number of road users wilfully or ignorantly flouting them must reduce significantly. But if most Lagosians remain disposed to not obeying the regulations – as is currently the case – enforcement capacity would be overwhelmed, and the description of Lagos as an “urban jungle” by then President Olusegun Obasanjo, in 2001, will continue to stick.
LASTMA official trying to arrest a "danfo" bus driver in Lagos.
Chaotic traffic – quite different from heavy traffic or “go slow” – heightens the sense of insecurity and is a scare factor for tourists. A less chaotic Lagos also has to be a clean city. The government has to orientate residents towards best practices in waste disposal and rein in industrial practices that promote environmental degradation.
Another strategic shift the state government has to make is to co-opt residents into the implementation of its modernisation policies. This will make policy implementation cheaper and more sustainable. One way to exemplify this is the greening programme of the government, which in recent years started under the immediate past governor, Babatunde Fashola. The programme appears to see the government as solely responsible for a green Lagos by contracting the planting of trees and grasses along the roads and in the public parks. Meanwhile, new residential and commercial real estate continue to spring up without ample greening. So quite simply, the government could specify the designation of green areas for any development plan to be approved. If such a regulation is in place, compliance must be enforced.
Lagos also needs to embrace its diversity. In stark terms, Lagos ought to be a place of equal opportunity for all residents. Lagos that is “a no man’s land” is consistent with its cosmopolitan aspirations. But during the 2015 election, we witnessed a very dark side of Lagos that suppressed votes of non-indigenes and threatened ethnic Igbos with genocide, if they didn’t vote for a certain governorship candidate. Hopefully, this ugly history would never be repeated. But because of it the government has to start dismantling all forms of discrimination in the state. Lagos has to lead in full assimilation of all its residents, even if other states are not doing so. No other state in Nigeria has close to the level of investment by non-indigenes as Lagos. The point being made may be blurred by a myopia, but one can envision a time when Lagos would have to compete for investments with other Nigerian cities, like what happens now between Dubai and Abu Dhabi.
There is no doubting the potential influence of Lagos in the transformation of Nigeria. But for the potential to become a reality, the standard of governance has to improve much better than we have seen in recent years. Fostering public enlightenment, citizen participation and embracing diversity are key to modernising Lagos and building on its head-start advantages over other Nigerian cities.