A Globalization Tool Nigeria Should be Using to Tackle Poverty
“How can anyone be on Tosin Adeoti ‘s wall and understand this government’s obsession with farming?”
I have never hidden my deep resentment for President Buhari’s much-loved policy of ‘Nigeria has able-bodied youths who should go back to the farm’.
In the face of globalization, it is a callous economic strategy.
In a post-coronavirus world, it’s a cold-hearted economic blueprint whose only output will be the mass production of poverty.
One of the greatest ways of growing a country’s economy is through export-based manufacturing. Britain, Germany, the United States, and China were built on the back of manufacturing. Remember I said export-based. If you don’t set up a structure for manufacturing companies in your domain to export, you’re fooling yourself. That’s why Nigerian companies use patriotism to manipulate you to buy from them. When they export, the ‘Buy Naija to grow Naira’ will obviously fail. But then this discussion deserves an entire article, so I will stop.
However, manufacturing, especially the type that China has managed to pull off, is incredibly hard. There’s only a handful of countries that have actually managed to jump into this export-based manufacturing stuff, and most of them are very close to one of the world’s technological hubs and are part of global value chains.
For instance, a 1000km-radius of Beijing (containing Tokyo and Hong Kong) provides 38% of the world’s manufacturing. 1000km around Stuggart in Germany and another 1000k around Detroit provide 40% of the world’s manufacturing. That’s almost 80% of the world’s manufacturing between these places.
Manufacturing development is actually very, very hard because geography really matters. Read Tim Marshall’s Prisoners of Geography or Thomas Sowell’s Poverty, Wealth and Politics.
Countries in Africa and South America that aren’t close to Stuttgart, Nagoya, and Detroit really have a hard time joining them. So the China model is really not open for most people, especially because of the way a country like Nigeria is structured.
However, the services industry, especially business support services, is a tremendous goldmine because of technology. Countries have deliberately built services industries worth billions of dollars. India is the world’s outsourcing hub projected to reach US$14.2 billion this month. Remember that Nigeria’s annual budget is US$34 Billion but the budget performance will likely be less than 50%, meaning while we budgeted to spend US$34 Billion, we will only have revenue of less than US$17 Billion.
Malaysia, Indonesia, Brazil, Costa Rica, the Philippines, and Egypt have mastered and are mastering taking jobs from developed countries and empowering their people.
To explain, this is what business support service outsourcing means: There are certain services some companies and individuals feel it’s better if they get someone outside their countries to do. Most of the time, it’s because of cost. For example, customer service. If someone wants to buy something on eBay and needs clarification, he doesn’t go to Ebay’s office. He either calls the customer service line or chats on the website. So eBay does not need to hire people in Britain when they can get any English speaker from around the world for much cheaper. They can train them online and they do the tasks very efficiently.
These tasks include but are not limited to human resource management, accounting, customer support and service, marketing, computer-aided design, research, design, content writing, software development, cyber security, diagnostic services, and legal documentation.”
Look at Kenya. The content writing service is booming. Kenya has created an enabling environment for companies and individuals in developed countries to seek out their people for academic writing. I recently read a Kenyan who makes $1000 a month from these writing gigs. The writing outsourcing industry is worth US$1 Billion and Kenya is said to be taking an elephant’s share of the money.
Look at South Africa. Amazon released a Press Release in June stating that it will add 3,000 virtual customer service jobs in South Africa. A 2020 McKinsey report finds South Africa holds an edge when it comes to so-called business process outsourcing (BPO) because of its ability to help companies lower the cost of doing business.
Over 3 million people are directly employed in India in the outsourcing industry and 10 million people are indirectly employed.
But Nigeria just continues to disgrace itself. When the folks in the technology industry came together to stop the harassment of its workers by the Police who have profiled IT workers as criminals, they were met with brute force.
While Nigerians are profiled as cybercriminals, Nigeria is not even in the top 10 countries with the most cybercriminal activities. Surprised? It’s true. Do you know the first? The United States. Second? China. Third? Germany. Nigeria is not in the top 20!
But you won’t think that listening to Nigeria’s president. As the country’s image continues to be pummeled, all the President could say during a 2018 panel appearance with world leaders at the Commonwealth Business Forum in London is that Nigerian youths are “lazy”. During a February 2016 interview with UK Telegraph, Mr. Buhari said Nigerian youths are disposed to criminality.
In a proactive country, the question that should be on the lips of our policymakers is, “How do we take advantage of technology to create millions of jobs for these talented young people?”
While the rest of the world encourages and provide enabling environments for young people to thrive in the evolving and very interesting world of digital technology, Nigeria encourages its youth to go back to the farm.
No country develops like this.