Diversification is a technique of investing in various industries, financial instruments, areas, and resources in order to reduce volatility. The word diversification encourages the principle of spreading out investment into various sections to reduce specialization. Diversification of Nigeria Economy is simply government directives of amplification of investment in the economic activities into different sectors of the economy. However, economic diversification in Nigeria since gaining her independent in 1960 has been the top priority in the policies and programmes of all administrations past and present inclusive. But the question is, how far have we gone in economic diversification since the discovery of oil?
Nigeria Economy Before the Discovery of oil
Nigeria got her independent in independent in 1960, during which Agriculture was predominately the source of revenue for the nation. Having been blessed with numerous agricultural products all around the country, capitalizing on it towards the development and growth of the economy at large. Various regions in Nigeria were known for the availability of one gricultural product or the other, which the produce in commercial qualities and were able to export them too.
Invariable, contributing higher percentage than other economic sectors in terms of revenue generation for the country. Products like coffee and cocoa were produced in commercial quantities in the western part of the country; rubber, timber, and other cash crops were major in the southern part, palm kernels and palm oils major in the east while groundnuts skin and hides majors in the northern part of the country. The Agricultural sector then contributed to up 65% percent of the GDP and employed up to 80% percent of Nigerians.
Nigeria Economy in the Oil Era
Prior to the discovery of oil, we were to an extent experiencing some level of economic diversification. There was a favorable exchange rate, the educational system was reasonably effective. Despite the illiteracy rate which still lingers to date, but those who were opportune to go to school were certain about employment immediately after graduation. The industrial sectors then also had enormous prospects with the establishment of various industries like the Ajeokuta steel industry, textile industries in the North, refineries among others.
The discovery of oil in Nigeria (1956) at Oloibiri village in the present-day Bayelsa state and the “Oil Boom” in the 1970s have arguably believed to had caused deviation in Nigeria’s economic diversification. A massive drift from diversifying the economy to a mono-economy driven by crude oil became the faith of Nigeria’s economy. As more emphasis and investments were channeled to the oil sector.
Although crude oil discovery in Nigeria has played a significant role in the growth of the country’s Gross Domestic Product (GDP), not without its shortcomings. It has been scientifically proven that, for a country to achieve economic development and growth, the most embrace wholeheartedly the approach of diversifying economic process. National economies as thumb stated in his rule, should “not be heavily dependent on a particular sector to drive economic growth and development”. A nation should “not put all her eggs in one basket”.
Attempts Towards Diversification
After the discovery of oil and its adverts effect, a lot of programs have been drawn out and implemented with the utmost aim of diversifying the country’s economy. In the Agricultural sector, so many investment programs have been adopted towards solving the mono economic problem. Among the investment programs includes:
*Creation of Nigeria Agricultural Bank in 1973. *Integrated Agricultural Development Project (ADPs) in 1974. *Operation Feed the Nation in 1976. *River Basin Development Authorities (RBDAs) 1977. *Green Revolution in 1980. *Rural Banking Programme 1977. *Rural Agro-Industrial Scheme (RAIS) in 1981. *Agricultural Credit Guarantee Scheme Fund 1977. *Livestock Development Programme (LDP) 1981. *Accelerated Development Area Program (ADA) 1981. *75% subsidy on fertilizer 1977 to 1983. Et Cetera
The above programmes and other recent programmes like The seven (7) point agenda, Vision 20:2020, Cashless Economy policy, N-power initiative among others are policies and programmes promulgated and adopted by various administration with regards to Economic Diversification. To some extent, Nigeria’s previous and the current government implements the listed programmes and policies as a way to improve sectorial proficiency and encourage intellectual capacity in understanding the process of structural economic diversification for adequate development especially in the policies that upheld extirpation of poverty and adds to economic growth.
59 years down memory lane, diversification of Nigeria economy with no doubt can be referred to as an “elephant project”. It is so obvious that all the various economic diversification policies and programmes of the Nigerian government both past and present are full of prospect but the problem lies with its implementation. None of the policies can be said to have achieved all its mapped out goals and objectives and so, giving rise to it becoming an elephant project or policies.
It’s so disheartening that 59 years down the line after securing our independence, we are still battling with economic diversification. Most countries that got their independent same year with us has really gone far in diversifying their economy and have stood out globally in term of good governance as well as effective and efficient economic management.
It’s no doubt that diversification of the Nigerian economy is the way forward towards the nation’s economic growth and development. Considering the global economic situation, the Nigeria government and her citizens must reiterate their step and start to see things differently. The government should see to the adequate implementation of all the economic policies and programmes as regards to economic diversification.
Also, sensitization process should increase to reorient Nigerians to appreciate and join the government in achieving economic diversification goal. Government and Nigerians should see the importance of investing in other sectors as a necessity for achieving economic growth. These sectors when invested on will significantly influence the economy diversification positively, sectors like;
Tourism sector. Tourism sector inculcates and promotes the influx of foreign investors to explore the country invariable injecting cash into the economy and positively influence diversification drive.
Agricultural Sector. The agricultural sector is a sector that largely involves a higher population of Nigerians in term of employment.
Entertainment: When investment on, this sector which covers many aspects has proven without a doubt in our economy its potential and capacity to employ huge labour force and can promote foreign investment to a reasonable quota toward economic development as regards to diversification.
Other sectors include; Industrial Sector, power sector, Technology sector among others, which when paid emphases on, will no doubt increase export and boost Nigeria economy and help achieve the sole aim of economic diversification.
Although it will be fair to say that Nigeria’s economic diversification process is not the way it used to be, it’s definitely not the way it should be. All the bottleneck faced in achieving the desired goals of economic diversification must be tackled head-on. These disturbing issues which are as a result of egoistic and unpatriotic nature of most government personals and citizens.
We most all embrace the spirit of patriotism, thinking of what we can do for our country, rather than what our country can do for us, and genuinely practicing the lyrical words in both our national anthems and national pledge which include “to serve our fatherland With love and strength and faith”, “to serve Nigeria with all our strength”, “uphold her honour and glory”, among others. Until Nigeria government and her citizens start putting into practice these lyrical words to action, achieving economic diversification will only be a mirage.
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