State-Capitalism in a Nigerian Context: A closer introspection, by Ibrahim T. Tumsah

I wrote about state capitalism with Nigerian characteristics a while ago, and my father asked me what i meant. This is in response to his question, in hopes that i will understand it myself.

There is a clamouring among the vast majority of youth in Nigeria for change. A move away from business as usual, away from the status quo. The angst is not random nor unfounded. The numbers speak for itself, Nigeria with its vast population of over 200 million— majority of which are between the ages of 18 and 30 finds itself the global capital of poverty with an estimated 120 million people living below the poverty line. It is an indictment on a country such as Nigeria to be the flag bearer of poverty. It did not always have to be this way, the country’s leadership since its independence in 1960 has continued to squander away its future and resources. Development has continually stalled while the leadership since those formative years has only gotten worse. Nigeria is a country without direction, unity or a defining ideology that unites its people to strive for its progress. In this, i find a problem. A multi ethnic, multi lingual, secular religious country should have an identifying ideology to unite its people.

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The umbrella of ideology provides the necessary framework for which the country can valiantly gallop to its vision. This makes the country have something to fight for, it provides a common ground for its development. As much as the youth want to rebel against our leadership, we must have an idea of what it is we want Nigeria to look like in the aftermath. Until and unless there is an ideological base for a popular mass movement, we will only end up back in familiar territory. The ideological battle is the actual work that needs urgent attention, energy spent elsewhere in protests and agitation only ends up in frustration. The foundation for this must be built solely with the consideration of Nigeria’s national peculiarities, history and culture. We must first form a consensus. This to a large extent inexorably determines what a nation and state craft is about. Having a solid ideological framework enables a country to withstand internal and external shocks if and when they come. This framework provides the architecture for which the population can get behind and build around. Without this, the nation is a deer in the headlights, directionless and wavering wherever the wind blows accordingly. In the world we live in and the international order the world is heading towards, it is of the utmost importance for the interest of Nigeria that we come up with a solid framework on how we see ourselves and how we interact with the world going forward. The future is going to be another battle for influence and state craft and our existence as a nation depends on it.

Once the ideology is established the political and economic structure becomes easier to maintain. Systems enable the ideology to operate its principles. A flexible system behind the ideology maintains the structure and keeps it full proof and water tight. After all, an ideology without a solid system to back it up will always falter, but a system and a modus operandi created to maintain this ideology makes its parts able to function autonomously without constant oversight or overreach between its parts. This coalescence of an ideology with systems creates a coherent policy framework for a functioning and efficient government structure. National security, foreign policy, economic policy, legal and constitutional laws will define the system. A system like this is built to outlast individuals and withstand internal and external shocks for the sake of posterity.

“No man ever steps in the same river twice, for it is not the same river and he is not the same man.” What does it say about us as Nigerians that want to move this country forward but keep doing the same things over and over again without realising that we might need to evolve and change our course of action and maybe perhaps try something different. Different does not always necessarily mean good or better but it can mean a fresh path to chart a course by taking bold steps to correct previous errors. The Obasanjo administration had the right idea selling some public owned companies through privatisation, but i believe it was a total farce in the way it was handled. A further step should have been taken by the government for clear oversight in the running of those critical sector assets. A structured privatising which allows the government to offer guidance whilst not completely selling off the governments ownership. This allows the government some structural powers and a stake in the success of that sector, for example the Dangote refinery. In caring for these industries the government can help mature and accelerate the industrial infrastructure at a tangible and measured scale. Doing this provides the right conditions for other newcomers into the sector in this sense the supply chain for that industry appears organically according to its needs, This approach prevents the rise of monopolies and promotes fair competition once the time is ripe for it.

For example, Agriculture is a crucial and fundamental yet vastly underdeveloped sector of Nigeria’s economy that could be one of the first to benefit at scale from a federal government and subnational perspective. We can learn a lot on how to develop our agricultural industry by emulating the Brazil model. Which entails; organising production and increasing output using farmers and large scale trading and export firms cooperatives. This model allows both the farmer and the enterprise to set output targets. As trust builds, they introduce and experiment with new crop varieties. The government provides guardrails and support for the firm, the firm supplies the seedlings and purchases the harvest at a fair market price, while the farmer is charged with planting, cultivation and achieving harvest targets. Light manufacturing plants will be set up in the short term in the environs to create a coherent network for the supply chain to achieve quick results and an easy transition before full scale manufacturing infrastructure are set up in the long term.
The idea should be nothing operates above the state and enterprise operates below it or at least in sync. Nothing operates beside the state, but it is channeled through the state. Unrestrained enterprise in the guise of capitalism is bound to self destruct the economy, giving way to dystopian realities. State authority must be wielded over enterprise to curb the free market excesses. This does not mean private enterprise has no say in the direction of state building, it just means the private sector and the state must operate in the same framework for targeted development and innovative projects that moves the nation forward at scale.

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Instead of the classic Western neo-liberal economic theory of capitalism where capital dictates for itself the rules for engagement in the free market. Here, the state remains above capital by restraining and regulating its inevitable excesses. In this way the federal government can encourage and incentivize the private enterprise industry in a specific sector; while it can measure and cap its profits to a certain extent and in most cases redirecting the profits back into providing essential services like human capital development, water, security, healthcare and education. This understanding fundamentally boosts the welfare of our society. This system restructures the civil service in a way that encourages workers to be involved in the success of their company or parastatal. Productivity increases while job security remains guaranteed. An employed person will not be worried about seeking another source of supplementary income unless they wish to. The individual company is responsible for running its day to day activities— seeking growth and profits, and the government is tasked with ensuring and providing the right environment for its success. However, the government must discourage and desist from making itself a welfare state. It must use a carrot and stick approach; where winners are rewarded and losers go out of business.

Universal free basic education should be state mandated and instituted in all 36 states till a child reaches their third year of junior secondary school, food will be provided to the poor. These are measured targeted at curbing the almajiri system and a means to address the large numbers of out of school children in Nigeria.

Leveraging on Nigeria’s excellent banking and fintech space, the financial sector can play a crucial role in the revitalization of Nigeria’s economic status. Using crypto technology and tapping into its potential, Nigeria can have the agency to opt out of the swift system or the “global plumbing” of international trade. This enables Nigeria to reconfigure its financial settlements in its own currency while trading internationally or with other African countries comfortably through its own financial architecture. This integrated system will liberate Nigeria from its dependence on the US Dollar and all the imported inflationary pressures it comes with. Using this system the Naira can derive goods trade in tokens and settle payments seamlessly. Initially, this trading system would be at a negligible margin but as it matures it could have the potential to be a significant faction of all our international trade settlements. This inherently makes goods affordable for the population easing the exchange rate crises. This does not mean Nigeria will completely stop using the swift or US Dollar at once, it just means Nigeria will have an alternative or parallel international infrastructure that enables autonomy and affords the ability to run a sovereign financial system that insulates the currency from external exchange rate volatility and lifts the burden of inflationary pressures from imported goods from around the world. Banks will primarily function as a source of raising funding and capital for innovation in state backed industrial projects.

Ultimately we can discuss ideas and ways to fix Nigeria as much as we want. The major change has to be a cultural and internal reorientation of Nigerian attitudes and behaviours in day to day circumstances. Morals, law and order must be paramount to every citizen that wants to live in a ‘working’ Nigeria. We must hold ourselves to account first before we can hold others to lofty standards. We must first recognize our collective flaws. A collective will for change can only come internally. The Quran teaches us that “Indeed, Allah will not change the condition of a people until they change what is in themselves.” (13:11). We must first take that first step, and the wind starts blowing in our favour. As a nation, cannot keep running away from our problems, uprooting our families to ‘working’ countries as immigrants. No matter where you go as an African/Nigerian you will always remain that.

The tide is turning in the internal politics of western nations who are now staunchly anti-immigration. Nigerians have no other choice but to fix the country ourselves— this takes will and courage. Being accountable for our own ailing country must be the foremost step to actual change in the country. National characteristics will always outlive regime change. As long as ordinary citizens remain stuck in their ways, no revolution or change in leadership will bear fruit or bring about an upheaval in the Nations fortunes. A leader is a reflection of his people because a leader comes from the same values as the people that elected him or her. Leaders are not unknown quantities that appear our of thin air in election years. They have lived and breathed the culture of their surroundings and any behaviour they display is not alien or foreign to that culture; it is just a manifestation of the said culture on a bigger scale.

However, it is unrealistic to expect the deep rooted dysfunction of Nigeria and Nigerianness to be dismantled overnight. These changes take time and effort. As long as there is a willingness for change and a fresh start, then anything is possible.

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