Over the years, Nigerians have clamored for a diversified economy, that is not over-reliant on crude oil. Recently there have been several talks about agriculture being on the front-burner of our exports.
But the reality is that there is a gulf in difference between the revenue agriculture can bring in and what Oil currently generates. Despite the steady growth in the value of Nigeria’s agricultural exports over three years (2016 to 2018), the country’s agricultural exports to total exports remained below 2%.
During the period of independence, Nigeria was a major exporter of food to West African nations; Unfortunately, she has morphed into a net importer. With the advent of oil in the 1970s, fiscal and economic policy was one-sided, and the country’s domestic and foreign investments were on oil, at the expense of other sectors of the economy. Inadvertently, Government revenue has increasingly come from oil and remains hostage to volatile oil prices.
In a recent report, the National Bureau of Statistics (NBS) claimed that Nigeria earned close to N289.3 billion from the exportation of the top 10 agricultural produce between April 2019 and March 2020. The report asserted that both commodities (sesamum seeds and cocoa) accounted for over 60% of the country’s exports as they are the most sought after internationally. Comparatively, the top 10 agricultural produce made N289.3 billion across three quarters. These figures are relatively low compared with the Q2, 2020 proceeds of crude oil which stands at N1.6 trillion.
From the above diagram, Oil generated N1.6 trillion in Q2 2020, while the other commodities combined to record about N612 billion in Q2 2020. One trillion naira lesser (considering Oil prices were significantly low during that quarter). A 2018 report from PWC showed that oil revenue accounts for more than 80% of total value of annual Nigerian exports. Ironically, the agriculture industry contributed an estimate of 25% to total GDP in 2018, while the oil’s share of GDP was 8.6% over the same period. Since the agriculture sector is the largest contributor to Nigeria’s GDP, it has potentials to contribute a larger percentage of our annual export revenue.
Agriculture toppling Crude oil as our main export might be a tall order, but if we want to truly diversify from oil and create proper value, agriculture must give birth to an industry.
If agriculture currently employs, say, one million Nigerians; the agro-allied industry can employ five million in the value chain. In a monetary context, if Nigeria produces cocoa beans, which recorded over N30billion revenue in 2018, an industry that processes cocoa to chocolates & beverages would produce double the revenue or more.
Oil would be the main commodity for a long time, but it is possible to create more financial values from other commodities.
HSE Summit 2020 to deal with developing environmental problems and an untapped $4.5tr recycling industry
The HSE Summit builds consensus on national agenda towards waste recycling for improved economic opportunities.
The earth is below a number of strain however the maximum urgent is absolutely environmental. Some of those are, on the moment, past man’s manipulate even as others may be contained. A big quantity of those pressures has constructed steadily over time, as the arena populace grew and needed to be supported through growing industrialization.
Okinola A. Alabi and his colleagues on the Federal University of Technology, Akure and Federal College of Education, Oyo, stated that among 1950 and 2018, the arena witnessed the manufacturing of approximately 6.three billion tonnes of plastics and out of those, handiest 9% and 12% had been recycled and incinerated respectively.
Africa has a large proportion of this hassle. Nigeria, because the maximum populous country in Africa, is amongst the most important turbines of strong waste with an envisioned 32 million tonnes annually. From this number, plastic waste constitutes 2.five million tonnes. This is a large hassle for anybody and a critical challenge for any forward-wondering stakeholder. It is mainly worrisome for the organisers of Health, Safety and Environment (HSE) Summit 2020, who’ve themed the event; HSE in our DNA: Recycling to Wealth.
Global issues across the terrible effect of single-use plastics at the surroundings have led governments and organizations to act, with the European Union, China and numerous states withinside the United States pronouncing policies that discourage such. These policies usually consist of ban on plastic tableware and straws, ban on using non-degradable plastic baggage and ban on non-degradable single-use plastics.
With the highlight on stakeholders in industry, specifically International Oil Companies (IOCs) and makers of Fast Moving Consumer Goods (FMCGs), and with the extra strain that the Covid-19 pandemic has exerted on the arena withinside the starting of a brand new decade, there’s no higher time than now to start a planned circulate to consolidate a country wide schedule on monetary possibilities in recycling and the reuse of assets.
It may be very strategic to have the IOCs and FMCGs in any communique on plastic recycling. The IOCs produce the substances utilized in making plastics and the FMCGs use plastics withinside the packaging and distribution in their products. They have crucial roles to play in commitments in the direction of recycling.
Bringing collectively stakeholders in manufacturing, academics, government, policymakers & shapers, nonprofits and social engineers, the HSE Summit attracts from the intertwining problems of health, safety, surroundings, safety and social economics to construct consensus on country wide schedule on waste recycling for stepped forward monetary possibilities.
One of its promoters, Ken Etete, stated that the focal point of HSE conversations in Nigeria are presently round compliance-primarily based totally goals, which want to shift to conversations so as to underscore commitments to fixing environmental issues and on the equal time developing monetary possibilities. “All over the arena, there are conversations round environmental sustainability which can be tied to monetary possibilities to be derived from them; if we study this from a aid performance perspective, the possibility is round $4.five trillion consistent with the World Economic Forum,” Etete said, including that, “As Africa’s biggest economy, we ought to have lively country wide and nearby structures that have interaction stakeholders in industry, regulators, the academia and the overall public; that is what we are seeking for to do with the HSE Summit.”
Obviously, producers have a robust function to play here, what with the whole chain of operation sitting with them. Land pollutants, water pollutants, air pollutants and different animal and plant issues are a number of the affects of the source-produce-and-discard version this is generally available now. Experts have flagged this as an unsustainable manufacturing version. Fortunately, technology has hooked up that those assets may be utilized in greater green and more secure approaches and the waste they generate may be converted from one shape to every other to serve various purposes.
To this end, the summit will especially name IOCs and FMCGs in Nigeria to the desk and interact them on those issues. “Multinational organizations have typically executed a great process globally in truly articulating their sustainability targets and we can not take as a right the development that this represents, thinking about that lots of them submit sustainability reviews that preserve them accountable,” Etete said, adding, “There is but a want to localise this international verbal exchange in Nigeria.”
A look at the bright spot in the faltering economy
The telecommunications sector remains one of the fastest-growing sectors in Nigeria’s ailing economy.
The impact of the restrictive measures on economic activities coupled with the downturn in the oil sector was apparent in the recent Q2 GDP data, as the nation’s GDP declined by 6.1%. However, there were a few brights spots, particularly the telecommunications sector which posted a growth of 18.1% in Q2 2020 from 9.7% in Q1 2020, outperforming the services sector which contracted by 6.78% during the second quarter compared with the
growth of 1.57% in Q1 2020.
We believe the robust growth in the sector is reflective of the sturdy improvement in the sector’s fundamentals, as active mobile subscribers rose to 196.4m at the end of Q2 2020 from 182.3m in Q1 2020 while active internet subscriptions grew by 6% to 143.7mn in Q2 2020 from 136.m in Q1 2020. Similarly, broadband penetration grew to 41.3% in Q2 2020 from 39.9% in Q1 2020. We believe the growth in the telecommunications sector was further bolstered by advent of the global pandemic which led to the increased use of digital channels for daily routine activities ranging from telecommuting, entertainment and social engagements. This was evident in the performance of two of the listed players in the sector, MTN and Airtel, as they recorded data revenue growth of 49% y/y and 39% y/y respectively.
The telecommunications sector remains one of the fastest-growing sectors in Nigeria’s ailing economy and we believe the sector is critical in the nation’s quest to operate a well functioning digital economy. In our view, the medium to long term growth prospects of the sector will be supported by increasing smartphone penetration, favourable country demographics, a fledgling social media culture and rapid investment by the industry players to enhance the quality of network infrastructure. With internet penetration still below 50% (41.3% as at June 2020), we think significant potential exists for telecom and internet service providers in Nigeria to unlock its transformative potentials.
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