Oyewole O. Sarumi |PhD|

The Ideology of Diplomacy Strategy and its effects in Building A Stronger Economy.

The Ideology of Diplomacy Strategy and its effects in Building A Stronger Economy.

Outlines/Coverage

▪ Introduction

▪ Definitions – ideology, diplomacy, strategy and Ideology of Diplomacy Strategy

▪ The Economic Systems

▪ Periscoping the Nigeria Economy

▪ General Challenges in Economies of Nations

▪ The Challenges Facing Nigeria Economy

▪ What Makes A Country’s Economy Strong

▪ Growing the Economy: Separating the Myths from the Facts

▪ Making Nigeria Economy Stronger: Deploying the Ideology of Diplomacy Strategy

▪ Conclusion

Introduction

▪ It is a sad commentary on political developments in Nigeria that after fifty years of independence, we have not produced enough evidence that Bernard Shaw could be wrong after all, when he noted long ago that “we learn from history that we learn nothing from history”.

▪ How Nigeria can be in this pitiful economic state leaves one to wonder ‘what the heck’ when nations like Malaysia, Indonesia etc. that got independence within five year range have been turned into economic wonders among nations!

What Determines a Healthy Economy?

▪ A human body, be it alive, unhealthy or dead, has the same volume of blood. The difference lies in circulation. We are healthy when our circulation is maximized, and our body begins to fail when our circulation is inhibited.

▪ The same is true for economies. All entities — individuals, companies or countries — are healthy to the extent that they have circulation. For a country, money is the equivalent to the body’s blood. And if the money is not flowing properly, the nation’s economy suffers.

▪ Whatever hinders the flow of money in circulation is ‘blood clot’. Sometime, the federal government is equivalent to a blood clot within the economy. It stops the flow of money by removing it from the system and distributing it to largely ineffective government programs, causing the system to work harder in order to compensate.

▪ The extent to which we have increasing government intervention correlates to the amount of money being pulled out of the country’s bloodstream. One such example is income tax.

Definitions - Ideology

▪ A system of ideas and ideals, especially one which forms the basis of economic or political theory and policy.

OR:

▪ A collection of beliefs held by an individual, group or society. It can be described as a set of conscious and unconscious ideas which make up one's beliefs, goals, expectations, and motivations.

Definition - Diplomacy

▪ An instrument by which a state (or, by extension, an organization or individual) attempts to achieve its aims, in relation to those of others, through dialogue and negotiation.**

**http://www.businessdictionary.com/definition/diplomacy.html

Definition - Strategy

▪ “The direction and scope of an organisation over the long term: ideally, which matches its resources to its changing environment, and in particular its markets, customers or clients so as to meet stakeholder expectations.” - Johnson & Scholes 'Exploring Corporate Strategy: Text and Cases'

▪ ‘Strategy is a long-term plan of action designed to achieve a particular objective or goal.

▪ Strategies are used to make future challenges easier to deal with.’

Definition - ‘Ideology of Diplomacy Strategy’

▪ From the foregoing, we can define the ‘ideology of diplomacy strategy’ in the context of this lecture as follows:

▪ “A system, body or instruments of beliefs, ideas and skills used to negotiate plan of action and/or destination with organisation or people through sharing information that will help both parties to come to a unified agreement on matters of interest without hostility.” [Oyewole Sarumi 2016].

What is Economy?

▪ An economy consists of the economic system of the country or the area, the labour, capital and land resources and the manufacturing, production, trade, distribution, and consumption of goods and services of that area.

Understanding the Economic Systems

• The three questions that every country must answer when developing its economic plan are:

1. What goods/services will be produced?

2. How will goods/services be produced?

3. Who will consume the goods/services?

• The way a country answers these questions determines what kind of economic system it will have:

▪ Traditional Command Market

Kind of Economic System

• The way a country answers these questions determines what kind of economic system it will have:

Traditional Command Market

TRADITIONAL COMMAND MARKET

• All economic decisions are based on customs, traditions, & beliefs of the past.

• People will make what they always made & do the same things their parents did.

• The exchange of goods is done through bartering.

• Bartering = trading without using money

• Some examples: villages in Africa & South America, the Inuit in Canada, Aborigines in Australia.

• All economic decisions are made by the Government.

• The government owns most of the property, sets the prices of goods, determines the determines the wages of workers, plans what will be made…everything.

• This system has not been very successful. More and more countries are are abandoning it.

• This system is very harsh to live under; because of this, there are no PURE PURE command countries in the world today.

• Some countries are close: Cuba, former Soviet Union, North Korea, former East former East Germany, etc.

• All of these countries have the same type of government: Communist! The The government is in control of everything.

• Economic decisions are made based on the changes in prices that occur as buyers & sellers interact in the market place.

• The government has no control over the economy; private citizens answer all economic questions.

• In a truly free market economy, the government would not be involved at all. Scary…

• There would be no laws to make sure goods/services were safe. *Food! Medicine!

• There would be no laws to protect workers from unfair bosses.

• Because of this, there are no PURE market economies, but some countries are closer than others.

• Some Examples: US, UK, Australia, etc.

So …… What??• Since there are no countries that

are purely command or purely market, what does that make them?

• Most democratic countries have some characteristics of both systems, so we keep it simple and call them: MIXED

• Of course, most countries’ economies are closer to one type of system than another.

• GDP is the total value of all the goods and services produced in that country in one year.

• It measures how rich or poor a country is.

• It shows if the country’s economy is getting better or worse.

• Raising the GDP of a country can improve the country’s standard of living.

• To increase GDP, countries must invest in capital goods:

• All of the factories, machines, technologies, buildings, and property needed by businesses to operate.

• If a business is to be successful, it cannot let its equipment break down or have its buildings fall apart.

• New technology can help a business produce more goods for a cheaper price.

• To increase GDP, countries must invest in human capital.

• Human capital is the knowledge and skills that make it possible for workers to earn a living producing goods and services.

• This includes education, training, skills, and healthcare of the workers in a business or country.

• Like all countries with democracies, Nigeria has a mixed economic system.

• However, because of a long period of military dictatorship, Nigeria’s poorly organized economy is struggling to move away from a command system.

• Nigeria would like to become a strong leader in the world’s oil market, but poor organization and corruption are obstacles that the country must correct and overcome.

• Nigeria’s GDP is $455.5 billion (US dollars).

• It is ranked 31st in the world.

• The GDP per capita (value of goods and services produced per person) is $2,800.

• Country comparison to the world: 180

**www.Theodora.com/wbfcurrent/nigeria/

• What are Nigeria’s major natural resources?

• natural gas, petroleum, tin, iron ore, coal, gold, limestone, niobium, lead, zinc, & arable land

• Nigeria has rich oil deposits.

• The country's petroleum sector is the focus of Nigeria’s economy.

• The United States gets almost 17% of its imported oil from Nigeria.

Nigerian Oil Spill, 2011

• What percentage of the land is arable (capable of being farmed)?

• 38.97%

• What are the major agricultural products?

• cocoa, peanuts, cotton, palm oil, corn, rice, sorghum, millet, cassava (manioc, tapioca), yams, rubber, cattle, sheep, goats, pigs, timber, fish

▪ The Buhari administration made appreciable progress in the agricultural sector. According to the NBS report, the agricultural sector share of GDP was 28.65% (representing the largest share since the 1970s), from 22.55% in Quarter 2 of 2016 and 20.48% in Quarter 1 of 2016.

▪ The Federal Executive Council (FEC) recently approved an agriculture promotion policy called “Green Alternative” (2016-2020).

https://www.naij.com/1055979-breaking-woes-nigeria-economy-shrinks-2-2-infographics.html

Currency e

• What’s produced in Nigeria’s factories?

• crude oil, coal, tin, columbite, rubber products, wood, hides and skins, textiles, cement and other construction materials, food products, footwear, chemicals, fertilizer, printing, ceramics, steel etc.

• Agriculture accounts for 70% of Nigeria’s economy.

• Nigeria’s chief exports include:

• Petroleum and petroleum products (95%), cocoa & rubber

• Nigeria specializes in exporting oil.

• Unfortunately, the emphasis on oil production has left other parts of Nigeria’s economy disorganized.

• Nigeria has to import food to feed its growing population.

• What percentage of the population over the age of 15 can read and write?

• Males – 72.1% ] 61.3% for the whole

• Females – 50.4% ] population.

• How long are students expected to stay in school?

• Males – 10 years old

• Females – 8 years old

Nigerian School

• What percentage of people do not have jobs?

• 23.9% of Nigeria’s workforce is unemployed.

• What percentage of people live in poverty?

• 70% of Nigeria’s population cannot meet basic needs.

▪ 51.53 million [2011 est.]

▪ Labour force by occupation:

▪ Agriculture: 70%

▪ Industry: 10%

▪ Services:20%

▪ Unemployment rate: 23.9% [2011 est.]

General Challenges in Economy of Nations

▪ The strongest economies should be those with three characteristics:

▪ public policy that places the highest priority on economic growth relative to other objectives

▪ No significant debt overhang

▪ Rising productivity among the workforce due to the diffusion of modern technology and business practices.

▪ Of all the economic indicators, the three most significant for the overall stock market are inflation, gross domestic product (GDP), and labor market data.

ECONOMIC CHALLENGES:

▪ 1. Business Environment: Inclement and harsh

▪ 2. Foreign Investment: Declining

▪ 3. Exchange Rate: Depreciating

▪ 4. Inflationary Pressure: Building Up

▪ 5. Foreign Exchange Reserves: Depleting

▪ 6. Industries closing down or relocating Abroad

▪ 7. Electricity and Gas Shortages: Aggravating

▪ 8. Relations with International Financial Institutions Including like World Bank, ADB: Improving

▪ 9. Exports Growth: Turning Negative

▪ 10. Corruption: Continuing and Thriving

▪ 12. Unemployment: On the increase

▪ 13. Insecurity & Sabotage of pipelines: Not too good

▪ 14. Debt owed: State Governments are owing workers’ Salary even after bail-out by FG

▪ 15. Domestic Investment : Not expected to Pick up

What to expect:

▪ 1. Political manoeuvring with adverse consequences on the economy.

▪ 2. Mobilization of people through taxation will take front burner.

▪ 3. Expenditure is expected to rise further with budget deficit

▪ 4. Political leadership will be struggling with the economy.

▪ 5. Energy shortage (electricity and gas) to aggravate further.

▪ 6. Politics is likely to dominate economics.

▪ 7. Improvement to infrastructure investment decisions

Economic Problems

▪ Economy affected by escalating attacks on Pipelines in the Niger Delta.

▪ Economy in recession – defined by rising unemployment, high inflation, increase in poverty index, reduced GDP, decline in stock market and housing market.

▪ Increasing production costs.

▪ Diversion of funds to counter terrorism.

▪ Energy shortage.

▪ Multiple Tax system.

▪ The ineffectiveness of cost of government;

▪ Unnecessary regulatory complexity;

The Challenges Facing Nigeria’s Economy

▪ The state of the society is defined by the effectiveness of the political leaders, great and well established social institutions. The multiplier effect of these results into a developed economy and people with superior quality of life.

▪ In such a clime, citizens empowerment become top priority in governance as the proper fixing of infrastructures and institutions propel the economy and create employment for the millions churn out by the educational institutions littered across the nation.

▪ Where the contrariwise is the norm, the state of such society is characterised by the ineffectiveness of the political leaders and poor social institutions which consequently cripple the economy and pauperized the people.

▪ These myriad problems in the society exerts untold pressures on the people to do all sorts in pursuance of daily living.

▪ In Nigeria, the promises of resolving the nation’s socioeconomic and political problems became the hallmark of political leaders over the years raising people’s hope by painting glowing picture of their development plans which they never pursue once in office.

▪ The answer to the challenges facing the Nigerian economy seem not to be in the hands of these present crop of leaders who are self serving, but in the hand of the people who should rise up and make demand for political leaders voted for to perform.

1. Human Development Challenges: ▪ Human resources play an immerse role in the success

or failure of any organization or nation in terms of capability and strength of character. In Nigeria, most of the problems facing the economy are a reflection of the poor quality of human development and management.

▪ Why? Education, which plays a critical role in human development and the economic health of the nation, has been neglected for decades (Krueger and Lindhal, 2001).

▪ The lack of high quality work force to propel the economy is owing to the inability of the nation’s educational system to perform its basic objectives. The system lacks adequate funding (for research and innovative ideas, etc.), lacks good planning and management, teaching materials and good quality teachers at all levels, and with poor governance and infrastructure, among others.

▪ Good quality education or value education involves ‘educating for character’, good ‘moral values’ and civic responsibility shape the character of nations. No nation would make any meaningful socioeconomic and political stride without viable educational institution. Our schools lack the tools to produce good quality graduates to manage the affairs of the nation. Majority of graduates workers lack the skills that drive human productivity.

▪ The immediate gains of education benefit the children themselves: learning key academic concepts, developing social skills, building self-confidence, and establishing positive relationships with peers and mentors.

▪ These individual benefits accumulate over the long-term to serve as a core foundation for strengthening our state economy. In general, states with better educated workforces have stronger economies with higher living standards.

2. Leadership challenges:

▪ Good, progressive leadership is a prerequisite for any country to thrive and be successful. The leadership of a country or state is a complex and monumental task.

▪ The leadership problem that has confronted Nigeria since independence seems to be worsening due to the rapid deteriorating state of the polity.

▪ The society that lacks committed political leadership would find implementation of developmental programmes difficult.

▪ Leadership is a process of getting things done through people,” and it means responsibility and having ‘passion for the purpose and the mission of the organization’ or society one leads (Northouse, 2007).

▪ The present crop of leaders fail to understand that performance is the only standard by which leaders are judged. Nigeria’s development rests with good leadership and better governance.

▪ Good leaders are transparent and always driven with the need to produce positive results. As Fullan (2001) notes, “Leadership, if it is to be effective, has to have an explicit [making-a-difference] sense of purpose ... and be ultimately assessed by the extent to which it awakens people's intrinsic commitment, which is …mobilizing of everyone's sense of moral purpose.”

▪ State or national leader in Nigeria and elsewhere for that matter should be a combination of many virtues. He/she (subsequently designated as he) should be, honest, knowledgeable, humble, fair-minded, compassionate, empathetic, and always ready to learn.

▪ To be successful, once elected and installed, a leader should rise above his electorate and partisanship and become leader for all. He should be a perpetual student of the complexity of the human condition; he should strive for equitable justice for all citizens, and he should be a custodian of the environment.

▪ A leader should have the potential to mould the present in a way that will promote a successful future for the country.

▪ While the development of a nation requires good leadership it also requires appropriate division of labor because it is unrealistic to expect a leader to do everything by himself.

▪ A county’s leader should be sensitive to the fact that we now live in a complex world where the ability to accomplish most tasks requires the pre-acquisition of a lot of basic knowledge, expertise and experience.

3. Governance challenges:

▪ Related to leadership problem is bad governance. Governance is defined as a system of values, policies, and institutions by which a society manages its economic, social, and political affairs through interactions within the state, civil society and private sector.

▪ Role of the masses: The masses themselves should be aware that consciously or unconsciously they too play a big role in making their country or state what it is. They do so by the leaders they choose to govern them, by the tasks they devote their time to, by how well they perform in their differing vocations and by how they treat one another.

▪ Governance comprises the mechanisms and processes for citizens and groups:

▪ To articulate their interests,

▪ To work together and mediate their differences, and

▪ Exercise their legal rights and differences, and

▪ Exercise their legal rights and obligations with rules, institutions, and

▪ Practices that set limits and provide incentives for individuals, organizations and firms.

▪ Bad governance (political, economic and social governance) - the three dimensions of governance is among the major causes of the problems facing the nation as it is threatening to undermine the nation’s democratization process.

▪ People are not allowed equal economic opportunity and freedom to participate in the political process.

▪ The problem with Nigeria is that the system lacks checks and balances (or mechanisms) to control the autocratic tendencies in government and to hold political actors accountable for their actions.

▪ Our politicians do not practice ethical politic and their actions do not add values to the system. Lack of ethical politics and values and politics of hate and destruction contribute to the economic and political hiccups in the society.

▪ The people should be politically active to get the government and the politicians to listen and act right.

▪ Political pressure from the people could determine the type of policy the government would choose for execution.

“One should always be mindful that whenever fate puts one in a position of service to society due to a unique talent or training, failure to serve and serve honourably is a violation of moral responsibility”. - Prof. Dike Kalu 2016

4. Corruption Challenges:

▪ Corruption is a global scourge, Nigeria appears to suffer the most from it because the leaders are pathologically corrupt.

▪ Nigeria nation seems to have a “ culture of corruption”. The huge sum of money earned from crude oil has disappeared through political elite cooperative corruption.

▪ A bunch of our political leaders are so rich through our commonwealth, while the nation is gasping for life.

▪ The wealth of a country is closely linked to the level of corruption. Corruption means that individuals who work hard or have good ideas do not get the benefit of their efforts - it all ends up going in bribes of one sort or another.

▪ So nobody tries hard to do anything but get to a place where they, too, can extort money and the country is stuck in basic poverty.

▪ The present government is making a headway, but lack adequate support from the people, political class and relevant institutions.

5. Infrastructural challenges:

▪ One of the main challenges facing the economy are poor social infrastructures; bad roads, moribund rail and waterways transportation, erratic power supply, limited access to potable water and basic healthcare, etc.

▪ Building a vibrant economy or restoring growth to a sluggish economy takes resources, to ensure long-term growth and prosperity.

▪ Nigerian must use her rescores wisely, invest in advanced technology and rebuild the infrastructures without which the economy will not gain from the power of productivity.

6. Institutional challenges:▪ Institutional challenge remain the bane of Nigeria’s

underdevelopment in the comity of ‘classmate’ nations. The police, education, health services, judiciary, legislature, financial institutions, regulatory agencies, and much more are in a state of anomie.

▪ Legal, political environment, policy framework: Whether the legal and political environment allows economy to flourish or not is a sine qua non for the economy to be poor or developed.

▪ The plethora of policies in the society is ineffective due to broken and dilapidated institutions.

▪ The regulatory agencies in the society (SON, NAFDAC, FRC, INEC, EFCC, CBN, CAC, SEC, etc.) are not free from political interference to operate effectively.

7. Environmental and Public Health Challenges

▪ The environmental and health standards of Nigeria are in a bad state. The health system in Nigeria does not adequately serve the population. The average Nigerian life expectancy is 38.3, according to the World Health Report, one of the lower life expectancies in sub-Saharan Africa.

▪ The government needs to play a bigger role in providing proper waste disposal systems and better healthcare, particularly in neglected rural areas. Environmentally sustainable disposal practices, like recycling, should be adopted.

▪ Those who vandalize oil pipelines should be pursued more aggressively and punished for causing oil spills. Bush burning must be limited so that the micro-organisms that promote crops output can thrive.

▪ Hospitals need better funding. The state must take steps to keep qualified young doctors in the country, perhaps by giving them more important roles in public health administration.

8. Civic Pride and Patriotism Challenge

▪ Nigeria suffers from a deficit of civic pride and collective responsibility. Wealthy Nigerians do little to use what they have to help the masses. Instead, they transfer their money to foreign banks rather than making it useful for the nation. When these wealthy men want to go on holiday, they travel to United States or Canada, and many emigrate to the developed world rather than spend their money here.

▪ Citizens should cherish the goods manufactured in Nigeria, and wealthy Nigerians should invest their money in local industry to encourage development. With this, more jobs will be created for the masses. Economic freedom should be encouraged in the country for better business growth.

▪ This lack of civic engagement has real economic consequences. The masses do not purchase the goods manufactured in Nigeria because they believe they are inferior. Instead they spend money on goods created in Europe, which doesn’t benefit businesses or ordinary workers in Nigeria.

▪ When local industry is discouraged, the Nigerian government spends more on imported goods. Even as an exporter of crude oil, Nigeria imports its refined oil from other countries, and will have to sell its agricultural products and goods from factories to abroad in quest of capital formation and pooling.

9. Macroeconomic challenges:

▪ Policy inconsistency and greed are among the causes of the haemorrhage in the economy (Eichengreen, 2004).

▪ Every administration that comes on board takes on a new policy initiative instead of building on the previous ones.

▪ Nigeria has toyed with a series of ineffective and poorly implemented policies that has stunted economic development.

10. Market challenges:

▪ Lack of genuine competition in the system is among the challenges facing the economy. Real capitalistic economies are controlled by market forces or what Adam Smith brands the ‘invisible hand’ of the market.

▪ The self-regulating nature of the market determines where one lives and works, how much one earns, and what one can buy.

▪ Every economy (developed, developing or underdeveloped) needs some form of government intervention, Nigeria’s leaders are yet to heed the advice of Adam Smith in 1776 that the state should not unnecessarily interfere in the economy.

▪ In Nigeria, the federal government has virtual monopoly of setting the prices of petroleum products and other goods and services.

▪ The federal government raised the prices petroleum products without considering the distributive negative consequences on the economy always raising the stick of subsidy to just this unleachment of hardship on people.

▪ Government should provide the enabling environment for a healthy economic competition, and allow the law of demand and supply (not personal idiosyncrasies) to regulate prices for the well-being of the society.

▪ Market forces (and competition”) would drive ineffective organizations out of business and open up more market to well-managed corporations.

11. Marketable Surplus of Agriculture challenge

▪ Increase in agricultural production accompanied by a rise in productivity is important from the point of view of the development of a country. But what is more important is that the marketable surplus of agriculture increases. The term ‘marketable surplus’ refers to the excess of output in the agricultural sector over and above what is required to allow the rural population to subsist.

▪ The importance of the marketable surplus in a developing economy emanates from the fact that the urban industrial population subsists on it.

▪ Since Nigeria as a country has failed to produce a sufficient marketable surplus, it is left with no choice except to import foodgrains which has caused a huge balance of payments problem that contributed to the present recession.

12. Capital Formation Challenge

▪ The strategic role of capital in raising the level of production has traditionally been acknowledged in economics. It is now universally admitted that a country which wants to accelerate the pace of growth, has no choice but to save a high ratio-of its income, with the objective of raising the level of investment.

▪ There is no sector with free money. Good sector is built through dedicated production and hard work. When the government talks about diversification, the expectation is to jump into another sector where free money could flow. There is no such other sector.

▪ Any sector that would bring revenue would need the hard work of production. Is the government and the people of Nigeria ready to engage and proceed in this direction? Time will tell.

▪ The Federal Government sets out a huge budget with massive revenue expectation from the Customs, FIRS and Ports Authority in a recessive economy.

▪ They forgot something: there would be a decline in importation under recession.

▪ In the same vein, State Governments are projecting massive increases in tax collection even without any projected improvement in production capacity. Haba!

▪ The role of productivity in determining living standards is important for nations as it is for individuals. According to Mankiw (2001) the productivity of a society is determined by many factors including physical and human capital, natural resources, and technological skills and knowledge.

▪ In economics, when production increases, tax accruing to government increases, so government should be interested in helping to expand and increase production by churning out favourable fiscal and economic policies that support evolution of a productive base. It is an exercise in futility when you want more taxes even where production is plummeting.

▪ Great reliance on foreign aid is highly risky, and thus has to be avoided. Economists rightly assert that lack of capital is the principal obstacle to growth and no developmental plan will succeed unless adequate supply of capital is forthcoming. This is only made possible where the economy is supported by a well developed productive based that supplies both local and foreign markets

13. Inability to Exploit Natural Resources Challenge:

▪ The principal factor affecting the development of an economy is the natural resources. Among the natural resources, the land area and the quality of the soil, forest wealth, good river system, minerals and oil-resources, good and bracing climate, etc., are included.

▪ For economic growth, the existence of natural resources in abundance is essential. As discussed above, Nigeria has a huge reservoir of natural resources, but remain poorly exploited. A country deficient in natural resources may not be in a position to develop rapidly. In fact, natural resources are a necessary condition for economic growth but not a sufficient one. Japan and India are the two contradictory examples.

14. Political Parties without Ideology:

▪ The multitude of political parties devoid of discernible modern political ideologies is a part of the problems facing Nigeria today.

▪ The politicians thrive on ignorance. In advanced economies and true democracies, there are inherent ideological ‘wars among political parties that drive democracy and economic development.

▪ In such nations people of similar ideology congregate under a party, push their agenda and build a strong democratic government.

▪ In the process of selling their ideologies (vision, values and beliefs) to the public, political parties help to shape the political culture of nations and promote development.

▪ In Nigeria, politicians shuttle from one party to another to achieve their selfish purpose, and many of them would disappear into the thin air after collecting their share of government grants.

▪ They are obstacle to political and economic development as their activities have negative impacts on the polity.

▪ Government should stop the grants INEC gives to political parties so that political parties that are there just to collect the grant would disappear.

15. Lack of True Federalism

▪ Lack of true federalism is among the challenges facing Nigeria. There’s too much power at the centre, with the federal government wielding enormous power, as it doles out monthly allocation to states and local governments and controls the mineral resources in their domain.

▪ The basic tenets of federal system is flagrantly violated which make the polity toxic.

▪ The Nigerian economy may not grow and the society may not change positively until the political parties and politicians learn to play by the rule.

16. Disrespect for the Rule of Law:

▪ Disrespect for the rule of law was rampant during the Obasanjo administration. It was an era of selective justice, with a set of laws for the rich and well-connected and another for the poor. Although disrespect for the rule of law has reduced, it has not stopped completely.

▪ There are still some unresolved electoral cases from the 2007 elections.

▪ The judiciary – the bar and bench are presently under scrutiny due to culpability in corruption cases.

17. Insecurity Challenges:

▪ Many insecurity issues bedevilling the nation cannot allow for any meaningful economic development.

▪ Some of these security challenges have been briefly highlighted below.

▪ Also, drawing copiously from existing literature on insecurity in Nigeria, the aetiologies of insecurity within Nigeria is twofold:

▪ Remote and

▪ Proximate causes.

Areas of Nigeria’s Security Challenges

1. The Niger Delta Crisis

2. Kidnapping in the South-East/West Zones of Nigeria

3. The failure of security agencies in the country.

4. The judiciary arm of government

5. Indecisiveness on issues bothering on insecurity on the part of the government

6. The Hydra-headed Unemployment

7. The issue of lop-sided development of the country.

8. The Boko Haram Terror Machine

9. Ethno-religious conflicts

10. Porous Borders

11. Systemic and political Corruption

12. Hired Assassins

13. Armed Robbery

14. Poverty & Illiteracy

15. Unending Call for re-structuring of Nigeria.

16. INEC and lack of trust for transparency during elections.

Remote Factors

▪ The remote factors include such causes as follows:

▪ Absence of Institutional Capacity Resulting in Government Failure

▪ The Gaping Chasm of Inequality and Absence of Fairness and Justice

▪ Ethno-Religious Conflicts

▪ Disconnect between the People and Government

▪ Weak and Poorly Funded Military Establishments

▪ Interagency Rivalry

▪ Non-Prosecution of Perpetrators of Violence In Nigeria

▪ Loss of Socio-Cultural and Communal Value System

Immediate and Proximate Factors

▪ According to Achumba et al, the proximate factors that have contributed to the state of insecurity in the country are:

▪ Porous borders,

▪ Rural-urban drift,

▪ Social irresponsibility of companies resulting in negative externalities which provoke social unrest within their host communities,

▪ Unemployment and

▪ Poverty and

▪ Terrorism, among others.**All these factors combine to create the

sultry security situation in the country.

What Makes A Country’s Economy Strong?

The 6 Goals of Economic Society

▪ The rich countries are rich because they have higher per capita income, higher efficiency.

▪ Efficiency is one of the six goals of society, but not the only one.

1. Security

▪ The first of the six goals is security:

▪ Personal security,

▪ Property security and

▪ Job security.

2. Efficiency

▪ The second requirement will be efficiency.

▪ Efficiency is defined as the average value that every individual creates in a given period of time.

3. Equity

▪ The third factor would then be equity (or justice, fairness), meaning that every individual has the same opportunities and is subject to the same limitation, which is law.

Definition for Equity is…

▪ …..the situation when the ratio between the value that any individual in the society creates and the domain that he/she controls equals to the ratio between the value that any other individual in the society creates and the domain that any other individual controls.

4. Social Freedom▪ The fourth factor will have to be social

freedom. What is social freedom? We have to understand what freedom is in the first place.

▪ Freedom means no limitation or restraints. There are two kinds of limitation. First, Natural limitation that comes from nature.

▪ Second, this kind of limitation is man-made, such as limitation in expression or thoughts, mobility, choice of occupation and the like. They are called social limitation. Natural freedom is without the limitation of nature, and social freedom is without the limitation of society.

Natural Freedom

▪ The fifth factor is therefore natural freedom in terms of time and space and the like.

6. Equality

▪ The sixth factor is equality, meaning an equal distribution of wealth.

Figure 1

▪ These six social requirements contradict one another.

▪ As shown in figure 1 here, dotted lines indicate contradictory relations and solid black lines demonstrate complementary relations. Where there is no line, there is no direct relation.

▪ Figure 1 has seven dotted lines and two solid black lines, indicating nine different kinds of relations:

The Social Requirements:Possible Scenarios/Combinations

▪ Security and Efficiency

▪ Social Freedom and Equality

▪ Social Freedom and Security

▪ Efficiency and Natural Freedom

▪ Social Freedom and Efficiency

▪ Efficiency and Equity

▪ Social Freedom and Equity

▪ Equity and Security

▪ Equity and Equality NOTE: There is no perfect social system in this world

Why did Japan develop so fast after WWII?

▪ According to figure 1, one has to sacrifice some degree of security in return for efficiency. Japan lacks natural resources and the sense of security, with her back to the wall, she develops intellectual resources.

▪ According to Guinness Book of World Records (1989), Japan has the highest average intelligence quotient in the world. Since Japan lost in the WWII, she has been forbidden to have military expenses anywhere more than 1% of her gross national product. She therefore has saved tremendous wealth from military spending. Japanese scientists and engineers design and manufacture many quality industrial products with reasonable price for civil use and export them to the world. They do not operate like the scientists and engineers of the other countries, wasting time and life in designing and manufacturing weapons. After the WWII, Japan adopted a democratic system with the rule of law. Her people enjoy sufficient social freedom with the system of law guaranteeing a fair competition as much as possible. The combination of all these factors has created an economic miracle.

Others Things that Makes A Country’s Economy Strong are……

• Capital Formation

• Desire to develop

• Social Organisation: Mass participation in development programs is a pre-condition for accelerating the growth process.

• Technical know-how and general education

• Conditions in Foreign Trade

• Marketable Surplus of Agriculture

▪ Natural Resources

▪ Geography

▪ Population

▪ Physical & Social Infrastructure

▪ Human Resources

▪ Political Freedom

▪ Good Governance

▪ Government Policies: Legal, political environment, policy framework

So, What Makes Economy Grow?

▪ The economy grows when individuals and businesses succeed in recognizing new markets and new opportunities and accept the risks involved in pursuing these opportunities in the hope of earning income.

▪ Why are some countries poor?

(1) They have lower average IQ.

(2) Higher military expenditure.

(3) Dictatorial government.

(4) Centrally planned economy.

HOW DO YOU RATE NIGERIA??

▪ Schramm said:

▪ “The single most important contributor to a nation’s economic growth is the number of startups that grow to a billion dollars

in revenue within 20 years.”

▪ But what really matters is a hundred or so companies, per year, that launch, find a market, execute, scale, learn, adjust and sail over the billion-dollar mark within two decades.

▪ If Nigeria is serious about building a strong economy, it had better get serious about removing the tax and regulatory barriers for these kind of startups with the potential to scale. Also, infrastructural deficits should be quickly corrected while the institutional framework to support this initiative is put in place.

Growing the Economy: Separating the Myths from the Facts

MYTH #1: Government spending grows the economy by pumping new money into it.

▪ FACT: Every dollar that government “injects” into the economy must first be taxed or borrowed from families, businesses, or other nations.

MYTH #2: Government spending makes people more productive.

▪ FACT: Government spending often encourages behavior that has bad economic consequences.

MYTH #3: The federal government should bail out faltering industries and states to revive the economy.

▪ FACT: Bailouts harm the economy because they reward reckless private and state spending, leaving it unchecked and effectively encouraging more of the same in the future.

▪ The Greek philosopher Aristotle once said, “If you want to encourage something, reward it. If you want to discourage it, punish it.” His words ring true 2,500 years later.

MYTH #4: Public works projects stimulate the economy by creating new jobs.

▪ FACT: In the short run, public works projects have no real effect on overall unemployment.

▪ They simply displace resources that could be used to create jobs in the private sector and move those resources to the government payroll.

MYTH #5: Tax cuts simply pad the pockets of the rich without helping a weak economy.

▪ FACT: Smart tax cuts encourage work, savings, and investment to help stimulate economic growth that benefits people across the board.

Making Nigeria Economy Stronger: Deploying the Ideology of Diplomacy Strategy

**This may not be too late if it can be pursued…

▪ At the recently concluded 22nd Nigerian Economic Summit in Abuja, President Mohammed Buhari said this:

▪ “…we need to diversify the economy so that we will never again have to rely on one commodity to survive as a country so that we can produce the food we eat, make our own textiles work; produce most of the things we use and create the right environment for young people to be able to innovate and create jobs through technology.”

**www.dailypost.ng/2016.10/10/

…BUT WE NEED TO DEPLOY SOME DIPLOMACY TOOLS TO RESOLVE

MOST OF THESE CHALLENGES BEFORE WE CAN DIVERSIFY EFFECTIVELY….

The Deployment of Ideology of Diplomacy Strategy

▪ Some of the problems facing Nigeria today require common sense solutions, others would involve sophisticated framework of ideas (debate, discussion and decision making) and application of modern technologies.

▪ Albert Einstein said that, the specific problems we face today cannot be solved at the same level of thinking we were when we created them’.

Recap…..

▪ Diplomacy is the employment of tact to gain strategic advantage or to find mutually acceptable solutions to a common challenge, one set of tools being the phrasing of statements in a non-confrontational, or polite manner.

What Ideology of Diplomacy Strategy Involves….▪ The sophisticated framework of tapping ideas that will help in building a strong

economy in Nigeria involve the effective deployment of the ideology of diplomacy strategy. [IDS]

▪ IDS would involve the following:

▪ Debate

▪ Discussion

▪ Negotiation

▪ Advocacy using CSO

▪ Town hall meetings

▪ Leaders’ conferences

▪ When done properly, it helps government in decision making that will help the economy to blossom.

Who Should be involved..

▪ State Actors: Civil servants responsible for the planning and economy, elected and appointed officials in both the executive and legislature, diplomats learned in trade, commerce, finance and economy.

▪ Non-state Actors: Civil Society Organisation, Trade Associations, Chambers of Commerce and Industries, Manufacturing Association/Groups, relevant NGOs, Corporate Bodies, Local leaders, Professional Groups, Technocrats, Academia, concerned agitators, etc.

The NEED for DIALOGUE to resolve

these ECONOMIC Challenges in a

pluralistic society like Nigeria is the

ONLY option to build a strong nation.

Why did Singapore become an economic success?

▪ Its strategic location and natural harbour helped.

▪ Welcomed foreign trade and investment.

▪ The government was kept small, efficient and honest.

Time to halt HARD Power usage!!!

▪ The TIME to stop using HARD DIPLOMACY through coercion and force is NOW. We can’t find a long list of nations that used this methodology to grow their economy.

▪ As already reported from the Guinness Book of Records, after the WWII, Japan decided not to allocate any fund to military wares, but diverted huge money to develop her industrial base, and today, they are among the G7 nations, and making waves with a vibrant growing economy

What a 'Strong Economy' mean to the Average Citizen?

▪ Supporting education initiatives.

▪ Supporting family wage jobs and firms.

▪ Focusing on tourism to increase revenue to businesses in communities.

▪ Facilitating community input on issues such as transportation, technology, health care, education, legislation, etc. and strategizing ways to meet the needs of the community.

▪ Working on government policies that promote, rather than inhibit, job-creating investments in technology.

▪ Improving public support and reducing the red tape and regulations that can delay vital projects and new investments.

▪ Improving access to insurance for those who don’t have it, without jeopardizing the coverage of those who do.

Conclusion

▪ Nigeria is today insufficiently developed because she imposed under-development on herself. With the globalization of the economy, Nigeria government need to wake up from this long slumber, and start building legacy for future generations. This is achievable with vibrant productive sectors enabled by favourable policies to create wealth where jobs are nurtured and protected. In short, we need a production economy.

▪ Corporations like the IOCs, TNC will not protect Nigerian and create the needed jobs that will make our nation strong economically. It is important to remember that corporations exist only to make a profit. To move beyond growth, businesses must seek new financial models, ownership structures and ways to measure impact.

▪ The Federal Government must provide a nurturing setting for the development of privately owned and employee owned businesses and new technologies that will help grow/diversify our economy. When these businesses flourish, the economy gets stronger. Small business incubators have an excellent record of rejuvenating local economies.

▪ However, with dilapidated infrastructures and weak institutions, such business will suffer atrophy. It is possible to make Nigeria economy strong and productive if our political leaders will start to govern as it’s done in developed nations.

▪ So, for the economy to grow, and for businesses to thrive, the institutions responsible for human capital development should be properly funded, equipped and managed to enable them produce advanced skilled manpower to manage the affairs of the nation.

▪ Also, the ease of doing business should be friendly and faster, while the infrastructures and requisite institutions should be functioning at optimal level to create an enabling environment for SMEs to thrive and FDIs to come in.

▪ The strategic role of capital in raising the level of production has traditionally been acknowledged in economics. It is now universally admitted that a country which wants to accelerate the pace of growth, has no choice but to save a high ratio-of its income, with the objective of raising the level of investment.

▪ Whatever be the economic system, a country cannot hope to achieve economic progress unless a certain minimum rate of capital accumulation is realized. However, any country that wishes to make spectacular strides will have to raise its rate of capital formation still higher. Wither Nigeria in this situation?

▪ In every nation, development activity is not a mechanical process. The pace of economic growth in any country depends to a great extent on people’s desire to develop. If in some country level of consciousness is low and the general mass of people has accepted poverty as its fate, then there will be little hope for development.

▪ According to Richard T. Gill, “The point is that economic development is not a mechanical process; it is not a simple adding-up of assorted factors. Ultimately, it is a human enterprise. And like all human enterprises, its outcome will depend finally on the skill, quality and attitudes of the men who undertake”.

It depends on your point of view

References Consulted

▪ Barry Eichengreen 2004. productivity growth, the new economy and catching up. Review of international economics, Vol.12, Issue 2; pg.243-245.

▪ Krueger, A.B, Lindhal, M. 2001. Education for Growth: Why and for Whom? Culled from https://ideas.repec.org

▪ Peter Northouse, 20007. Leadership: Theory and Practice. 6th edition. From https://www.corwin.com

▪ Oyewole Sarumi. “Challenges Facing Nigeria Economic Development”. Culled from drwoolay.wordpress. com/2015

▪ Anna Mar. 15 Diplomacy Strategies For Negotiations. Culled from http://training.simplicable.com/training/new/ on Nov. 19, 2015

▪ Michael Fullan (2001). Leading in a culture of change, CA: San Francisco, Jossey-Bass

▪ Victor E. Dike. Governance and Nigeria’s Weak Institutions: Is the 2020 Project Achievable? Culled from http://www.gamji.com/article8000/NEWS8396.htm

▪ Mike Uzochukwu. What Are The Problems Facing Nigeria Today. Culled from http://nigerianobserver news.com/2015/05/

▪ What makes an Economy Strong? Culled from http://www.quora.com/2014

▪ Economic Settings For Policy And Growth. Culled from www.strongbuilding.com.au

▪ How to build a strong economy? Architecture jobs. From www.marketplace.org

▪ Lee Kuan Yew’s Singapore: An astonishing record | The Economist. www.economist.com

▪ What are the criteria to be consider for an economy of any country to be called as strong economy? – Quora. From www.quora.com

▪ Building a Strong Economy: The Roles of Education, Transportation, and Tax Policy –MassBudget. From www.massbudget.org

▪ On what factors does the economy of a country depend? – Quora. From www.quora.com

▪ What -grows-an-economy Culled from http://www.forbes.com/sites/richkarlgaard/2010/10/20//2/#658e 56671b34