Conflict and the Decline of Private Sector

Malam Isa Yuguda

 

Iam happy to have this chance to contribute on this very important topic that will continue to deepen the search for sustainable peace in the North in particular and the whole country in general. No doubt, this is a search to which we are all committed, and in pursuit of which we shall never slacken.

Causes of Conflict

The occurrence of conflicts in society has been explained as a symptom of the competition or struggle for society’s scarce resources—whether by the elite in government for themselves or ostensibly on behalf of their areas or ethnic group or between nomads and farmers. They can also be explained as a violent expression given to what may be called ‘hierarchy of ethnic needs’—need for identity, security, recognition, right to participation and the psychological need for a feeling of autonomy.

Such conflicts are nothing new to the North but in the past, as in the case of the Tiv riots of 1958, they were restricted in an area, were short-lived and were neither communal nor religious. They didn’t result in any religious polarisation or tension that lasted for a long time. In 1967 the Araba riots and its reprisal swept the North and East, for the first time introducing the issue of overt ethnicity; and later, as a consequence, the civil war broke out; and, even though it involved the North, the theatre of conflict was very far away in the South-East.

The first major conflict of a religious nature to happen on Northern soil was the Maitatsine riots of 1980, and even though it was a largely Muslim affair, it marked a watershed. Since then there has not been a quiet, conflict-free decade in the North. In 1987, Kafanchan exploded and an ominous interreligious angle was added to the mayhem; and for the next quarter century, this would continue to hold the region and the nation to ransom.

After Kafanchan, there had been other flashpoints at regular intervals—Zangon Kataf in 1992, Tafawa Balewa and Kano in 1991, Kaduna in 2000, Jos in 2001, Kaduna in 2002, Yelwan Shendam in 2004, Maiduguri in 2006, Jos in 2008; and from 2009 to 2011, anti-state Boko Haram would straddle the landscape from Maiduguri, Bauchi, Damaturu,Potiskum, Zamfara, Suleja to Abuja; and Jos in 2011, among other places.

All these had religious undertones; but there were others, such as the ones between Tivs and Jukuns, between the people of
Billiri and Kaltungo and the Fulani and Karekare of Ngelzerma in which the antagonists were of the same religion. Whether religious, political, communal or ethnic, riots have now tended to be endemic in the North.

Religious riots had occurred ostensibly in defence of one or against the other, or in support of the adherents of one or in vengeance on behalf of the other. Politically-motivated violence might be in defence of a political idea or to promote the political agenda of some elite or a section of the country, or to protest the result of an election lost; and from there it took on a life all its own.

Communal riots had occurred as the byproducts of elitist struggles for space and control; but they would often wish to hide behind some historical grievances or seek to exploit those with a mentality of victimhood. And because of ignorance or gullibility of ordinary people, or, indeed, their willingness to be used, the elite had always found it easy to manipulate religion, ethnicity and historical grievances to their advantage.

Violence had often resulted as a way of dealing with tension between nomads and farmers over grazing land or in response to perceived official bias in handling the aftermath of clashes or as a result of an irresponsible misuse of the media. But whether religious, communal or political, the effect of the riots had been the same. In their wake, thousands of lives had been lost, inter-religious harmony and inter-ethnic trust had been shaken, and tension had risen as the security and law and order situation had deteriorated.

The Private Sector in the North

With the cities of the Hausa States and Kanem- Bornu Empire at the southern end of the trans-
Saharan trade routes, the North was the buffer and arena of exchange in the economic transactions that linked the great Sahara Desert and the littoral empires of old. But besides acting as middlemen for the desert-coast exchange, people in the North produced artifacts in their own right and they were agrarian. When colonialists arrived, they changed the direction of the economy. Commerce was no longer looking northwards to the Sahara: it was now made to look inwards as the agrarian economy of the North was turned into a cash-crop one to service British industry newly-furnished by the Industrial Revolution.

Even in pre-colonial times the North had a dynamic, progressive and market-oriented economy that thrived on trade in livestock and agricultural products, leather, iron and bronze works and handicrafts with the Arabs to the north and the coastal kingdoms to the south. But because of colonial economic development policies that encouraged the production of particular agricultural products and
trade in them with Britain, Nigeria’s development process has come to depend on external factors as it is today.

Despite the preponderance of oil, which still accounts for more than 70% of total Federal Government revenue and more than 98% of its foreign exchange earnings, it adds up to only a little more than 10% of GDP; while agriculture remains the mainstay of the economy, employing more than 70% of Nigerians, and accounting for almost 20% of GDP. Long term economic development should have based policy on an agriculture-led strategy.

Instead a wild variety of development strategies were tinkered with, used and dumped. None of the development strategies employed
seemed to have worked—whether it was import substitution, backward integration, establishment of industrial estates and industrial development centres, export-led growth or the structural adjustment programme, SAP; and of particularly negative consequence has been the stoppage of the national development planning process that came with it.

The ostensible objective of the 1986 structural adjustment programme, SAP, was to restructure the
economy and diversify its productive base in order to reduce total dependence on oil and imports. The main features of the programme were trade liberalization, deregulation of the financial sector and of Naira exchange rate, and the removal of subsidies and the privatization of public sector enterprises.

But the result of SAP had been to further impoverish the people and aggravate this decline; and instead of sharing a national cake, the people ended up sharing national poverty. In reality, the decline of the private sector in the North began a long time ago, precisely when the economy came to depend on oil; and policy emphasis shifted from agriculture to heavy dependence on oil, services and importation of finished products.

The cultivation and sale of cashcrops and associated local industries, which had been the region’s mainstay, declined; with the result that the textile industry which had developed around the cities of Kano and Kaduna has now shut down.

Conclusion

All the factors necessary for the development of a robust private sector and the successful take-off of a modern industrial economy are there, as there were before. The region is endowed with an extensive, fertile, mineral-rich arable landmass more than 600,000 square kilometers in area that can, with the right policies and the right quantity of subsidies, support a variety of agricultural activity that can feed and make the region a net exporter of food as it supports a multitude of agro-allied industries.

Under the current climate, these potentials will remain largely unrealized, because the violent conflicts that have engulfed the North have seriously undermined the conduct of business operations and have ruined the foundation of economic development upon which we must base any effort to rebuild it.

As violence rises, sources of financing for business dry up as investor confidence vanishes. The investor must be brought back and his confidence restored; and with the right assurances and incentives, this shouldn’t prove difficult. But conflict is not the only variable that has kept the private sector in decline. Besides the issue of conflict, the basic causes of the weakness and low level of investment in the private sector in northern Nigeria are the lack of basic, functional education and the dilapidated state of socio-economic infrastructure, poor service delivery, and high levels of corruption and people’s low purchasing power.

The future economic growth of the North will require greater and easier access to micro-finance, other banking services suitable for medium-sized enterprises and other venture capital for large businesses. At the same time, conscious effort must be made by the leadership to diversify the base of the local economy by developing its traditional agricultural base, promoting small-scale industries and resuscitating manufacturing.

But first, the region must begin the great task of rehabilitating the extensively dilapidated infrastructure and poor social services—roads, power and water supply, health care and education. The governments of the states of the region must consider as a matter of the highest priority the planned development of the region’s human capital by imparting the right type of general education, modern skills of technical and economic analysis for those who will grow the region’s economy. With the highest number
of children not going to school in the whole world, the North leads the world in illiteracy, and this is something that must be reversed with immediate effect.

It must repair, complete and harness and exploit the potentials in the many abandoned hydro-electric power projects for the supply of electricity and for irrigation; and find and exploit alternative sources of power supply, and the future looks like it is going to go chiefly wind and solar. The Northern environment itself has been so much abused that to all intents and purposes, it is hostile to the development of local entrepreneurship.

The great Sahara Desert is no longer next door— it is the door, because it is already with us, along with many of its unsavoury effects. At independence, for instance, Lake Chad occupied an area of 25,000 square kilometers; but today, it is 2,500 square kilometers, a mere 10% of its former size— the 90% had been devoured by the desert.

Now, more than anything else, government must take charge of the security and law and order situation in the region. It must ensure that there is in place a regime of the rule of law, respect for human rights and equality before laws which must be transparent. It must fight and be seen to fight corruption; because even after its conflict resolution mechanism has been put in place, it needs to do all it can besides to convince and attract both foreign and domestic venture capitalist to invest.

But while we should all be worried about the revival, growth and further development of the private sector in the North, our priority should be more to end this cycle of violence, not least because there can be no meaningful development without an end to it, in any case. And when the cycle of violence is finally broken, private equity investors within and outside the country may begin to disregard the other elements that go to make the cost of doing business in Nigeria too high and restart investments in the North; and this is not impossible, because, in spite of everything, Nigeria remains the biggest market in Africa and the North potentially the most lucrative.

The North still enjoys comparative advantage in agricultural production—for food and for cash crops. It also has several unutilized and abandoned irrigation projects across the Northern landscape that can be put to good use. With the right policies, guided and supported large-scale mechanized farming, a few states in the North can feed the whole country and help stop the ruinous importation of food into the country.

And with the right incentives, cotton production can pick up to feed and revive the moribund textile industries that litter the Northern landscape. But before that can happen, the Federal and Northern states’ governments must deal squarely with the issue of power supply and the rehabilitation of other infrastructure. With the right political will, this can be done within the space of a single term.

In order for all this to work, the region must be in the forefront of the effort to source and make available affordable funds for all sorts of investment uses—from micro-credit for the small-scale entrepreneur to large capital outlays for industrial development and other business opportunities in manufacturing, solid minerals development, communications, electronics and information technology and banking.

Perhaps the first and most realistic step to take is to rediscover the secret and work culture of the New Nigerian Development Company, NNDC, and revive the conglomerate and make it the hub of the total industrialisation of the North; and its most important fallout will be the revival of the private sector in the North.
•Yuguda is the Governor of Bauchi State

Courtesy  Thisday Backpage