Sanusi Lamido Sanusi: Nigeria's economic development aspirations and
the leadership question - is there a nexus?
Speech by Mr Sanusi Lamido Sanusi, Governor of the Central Bank of Nigeria, at the
2nd General Dr Yakubu Gowon Distinguished Annual Lecture, Lagos, 19 October 2012.
* * *
Protocols
1. It is indeed a great honour for me to be invited to be a part of the 2012 Yakubu Gowon
Foundation (YGF) Distinguished Annual Lecture Series, the second in the series. I consider
it, a unique opportunity and privilege to be asked to present this year's Annual Lecture, which
is to commemorate the 78th Birthday anniversary of an illustrious and eminent Nigerian,
General Dr Yakubu Gowon, GCFR, for his invaluable contributions to the continued
existence and development of our dear nation. Permit me to crave the indulgence of the
distinguished personalities gathered here, to express my sincere appreciation to the
Management of the YGF for tenaciously pursuing the vision of the founding father of the
YGF, of making the world and, indeed Nigeria, a better place. This vision encompasses
amongst others: supporting communities to have access to sustainable healthcare,
education and agriculture as well as fostering peaceful co-existence through strategic
partnerships. This vision remains a laudable and important trajectory for the elevation of
mankind.
2. I would like to start by placing on record, the immeasurable and unforgettable
contributions of the Celebrant, to ensuring that the country remains an indissoluble and
indivisible entity through his committed, engaging and conciliatory leadership style which he
bestowed on Nigeria during, unarguably, the most difficult and challenging times of her
existence. The task "To Keep Nigeria One" and his vision of "a united and prosperous
Nigeria" which he led during the trying period of the nation would have remained a mirage if
not for the commitment and doggedness demonstrated by him and other compatriots living or
dead. In the same vein, it can be said that the economic foundation of modern Nigeria began
with his administration's pursuit of infrastructural expansion through the construction of
numerous road networks, waterworks, airports, educational institutions, dams and power
infrastructure, etc., across the length and breadth of the country. Others include the
decimalization of the Nigerian currency, the establishment of the National Youth Service
Corps Scheme and the judicious spending of the petro-naira, which providence bequeathed
on the nation in the early/mid-1970s, to mention a few.
3. It is against this background of his achievements in leadership and the current public
perception of a disconnect by the leadership with the developmental quests of the country,
that I have, with the liberty accorded me by the organizers, chosen "Nigeria's Economic
Development Aspirations and the Leadership Question: Is there A Nexus?" as the title
of my discourse at this distinguished gathering today. This choice is also to provoke our
thoughts on the need to accelerate the process of grooming and development of leadership
across the various strata of our society. You will agree with me that it is appalling to observe
that five decades after Nigeria's independence, our nation has remained beleaguered with
the challenges of leadership, particularly, those imbued with selfless and unflinching desire to
steer the course of our economic development and national unity.
Nigerian economic development aspirations
4. As you will recall, in the quest to improve the material well-being and welfare of the
citizens, various governments have over time embarked upon numerous developmental
policies, plans, programmes and projects. Notable among these was the First National
Development Plan (1962-1968), which was designed to put the economy on the path of
accelerated growth by prioritizing agricultural and industrial development as well as training of
high-level and intermediate manpower. The Second National Development Plan (1970-1974),
through to the Third National Development Plan (1975-1980), were devoted primarily to
reconstruct and rehabilitate infrastructure that were destroyed during the civil war years. This
period witnessed massive investment of resources into the rehabilitation and construction of
new infrastructural facilities.
5. Moreover, the Fourth National Development Plan (1981-1985) was designed to reduce
the dependence of the economy on a narrow range of activities and broaden the economic
base as well as develop the technological base. The economic downturn of the early 1980's
necessitated the implementation of Economic Stabilization Measures and later the Structural
Adjustment Programme (SAP), which was aimed at creating a more market-friendly economy
and to encourage private enterprise through the removal of cumbersome administrative
mechanisms in economic management. The economic deregulation and liberalization
policies of the late 1980's and 1990's had the goal of fostering effective allocation of scarce
resources. Furthermore, Nigeria's Vision 2010 was aimed at "transforming the country and
focusing it firmly on the path to becoming a developed nation by the year 2010". According to
the document, the private sector was expected to be very active, within a market-oriented,
highly competitive, broad-based, private sector-driven development process. In addition, the
return of democratic governance in the country in 1999, brought along with it the introduction
of a series of reforms, aimed at redressing the distortions in the economy and restoring
economic growth. The National Economic Empowerment and Development Strategy
(NEEDS) of 2004 was a home-grown poverty reduction, value-reorientation and
socioeconomic development strategy for the country.
6. Let me reiterate the fact that all plans, programmes and visions enumerated above,
were to guarantee Nigeria's economic development by altering the model of economic
structure of production and consumption pattern, reduce dependence on oil, diversify the
economic base, generate employment, create a globally competitive and stable economy.
Looking back, it is clear that the economy has not actually performed to its fullest potential,
particularly in the face of its rising population. The Nigerian economy has grossly
underperformed relative to her enormous resource endowment and the achievements of her
peers/other developing nations with similar characteristics. This is, particularly so, because
agriculture has remained largely peasant, while the high contributions of the tertiary sector to
output suggest that the sector is not really servicing the Nigerian economy but, indeed, other
economies. Little wonder then that the diversification index remains below 0.4 per cent over
the years in spite of the numerous reforms that have been put in place.
Comparison with countries with almost equal economic standing at Nigeria's
independence
7. Nigeria's economic performance has been rather weak and does not reflect its level of
resource endowments, especially when juxtaposed with the experiences of some emerging
Asian economies that faced similar challenges and choices about five decades ago. A
number of East Asian countries, notably, China, Indonesia, Malaysia and Singapore were far
behind Nigeria in terms of GDP per capita in the 1970s. Today, these countries have
transformed their economies and are not only miles ahead of Nigeria, but are also major
players on the global economic arena. In 1970, while Nigeria had a GDP per capita of
US$233.35 and was ranked 88th in the world, China was ranked 114th with a GDP per
capita of US$111.82. However, with the visionary leaderships and the collective resolve of
the citizens, China had recorded an impressive average annual growth rate of GDP of
9.5 per cent at the start of its market reforms in 1978 to 1994. Thereafter, China has
sustained this rapid growth, perhaps, the highest in the world and has been transformed to
the second largest economy in the world behind the USA.
8. Distinguished ladies and gentlemen, it is instructive to also note that the experience of
Indonesia offers us a great deal of lessons due to the fact of being a plural society with over
200 languages and ethnic groups and a population of over 250 million. Indonesia with a per
capita income of about $55 in 1965, has recorded a faster growth by year 2000 compared
with other major emerging markets. This was made possible by the good leadership that was
able to surmount the numerous challenges, and achieved tremendous growth and
development such that it now towers over Nigeria in all material aspects of development. As
a matter of fact, being the largest economy in South-east Asia, the government has
introduced wide-ranging reforms. These included the pro-poor, pro-growth, pro-employment
economic policies coupled with the removal of artificial economic distortions, as well as the
promotion of conservative fiscal policies, which resulted in a fiscal deficit of less than
2 per cent, among others. By 2011, Indonesia's per capita income had risen to US$2,981,
with more than 60.0 per cent of the population having access to safe water, compared with
39.0 per cent for Nigeria.
9. With a per capita GDP of US$299 in 1960, Malaysia has successfully transformed from
a producer of raw materials to an emerging multi-sector economy. In 2011, the real GDP
growth rate stood at 5.2 per cent, while the population living below the poverty line is less
than 4.0 per cent, with unemployment projected at 3.1 per cent. Electricity production was
about 118.2 billion kw/h while consumption stood at 93.8 billion kw/h. Foreign exchange
reserves stood at US$129.6 billion while her total debt stood at about US$78.2 billion. The
transformation of the country's economy from mono-primary product exporter to a dynamic
and vibrant industrialized nation has been linked to a variety of pull factors namely, political
stability, prudent and influx of foreign investors, business-friendly policies, productive
workforce, developed infrastructure that is comparable to that of any western country, and a
host of other amenities making the country a good destination for foreign investments. By
2011, Nigeria was still lagging behind with GDP per capita income of $1,500 compared with
Malaysia's US$2,981 and 87.0 per cent of population having access to safe water.
10. In 1960, Singapore's GDP per capita was $395 which grew to $925 by 1970, while
Nigeria's rose from US$96 to US$219. By 2011, with GDP per capita income of US$1,500
Nigeria was seriously lagging behind Singapore's US$43,865 per capita GDP. The
proportion of the population with access to safe water increased to almost 100 per cent of the
population of Singaporeans. Today Singapore ranked as the world's 2nd most open
economy in the Asian Pacific region. The country is highly developed, and operates under a
successful free market system and an environment devoid of corruption. The government
runs efficient and competitive tax rates and low public sector expenditure. The regulatory
environment has been flexible and transparent with a strong tradition of openness to global
trade and investment, which continued to boost the country's productivity. As a fall-out of
best practices, the private sector has been the source of Singapore's economic success,
while the government continues to play a proactive role in guiding its economic development.
The country is ranked as the 3rd wealthiest nation in the world. The Singapore miracle was
made possible by years of successive visionary leadership that were able to transform the
economy through consistent policies.
11. A cursory examination of these three emerging economies reveals how these
economies have been remarkably transformed over a space of 50 years. A closer look at the
aforementioned indices signaled to the fact that Nigeria failed to keep pace with its
contemporaries, despite being more resource endowed than these countries. As a matter of
fact, history has it that Malaysia at the early stage of its development procured improved
oil-palm and rubber seeds from Nigeria and became the world's largest palm-oil
producer/exporter and a major exporter of rubber, with Nigeria having nothing to show for it,
but instead has become a major importer of these commodities.
12. Perhaps, at this point we must ask ourselves why these countries fared better than
Nigeria. The obvious answer no doubt points to the leadership question. Today, these
countries have been able to successfully surmount the economic quagmires that
characterized their economies at the early stages of development having transited from
poverty, corruption and political imbroglio into a more stable and prosperous nations.
Therefore, the success stories of these East Asian countries attested to the truism that
leadership plays a crucial role in the development of any society. The commitment and good
governance by the leaders in these environments translated the societal aspiration and
vision into concrete terms as demonstrated in the amazing economic and political progress.
Visionary leadership and good governance, no doubt, remains the hallmark of pushing the
growth and development frontiers as well as accelerating the pace of economic progress. We
can, without any fear of contradiction assert that these leaders were nationalists, visionaries
and uncompromising leaders in their various rights.
13. At this juncture, it will not be inappropriate to affirm some of those leaders who
championed the course of development in their countries. Mohamad Mahathir of Malaysia,
Jiang Zemin of Peoples' Republic of China, Lee Kuan Yew of Singapore, Suharto of
Indonesia, to mention a few, were reformers and change champions in their own right. The
former Prime Minister of Malaysia, Mahathir Mohammed was responsible for the creation of
a world class economy in Malaysia, and was able to guarantee higher standards of living,
higher literacy and higher life expectancy for his people. Accordingly, he implemented
appropriate economic policies to encourage enterprises in Malaysia to grow and expand by
adopting latest technology and management practices and ultimately compete globally.
Mention should also be made of the former President Jiang Zemin of the Peoples' Republic
of China. His leadership qualities were extolled for exposing centralized communist
economic system to capitalist market stimuli and achieving spectacular progress for China.
What can be gleaned from the Asian experience
14. Certainly, the rapid growth in Asian emerging economies has the potential to provide
some lessons to Nigeria. The remarkable success of the economies of the Asian countries
raises the question of factors that accounted for these success stories. The Asian miracle
was able to create resources which were managed efficiently to promote economic growth
and development. The structure has helped in freeing the countries from corruption as
resources are directed to areas that produce high economic returns.
15. An indispensable lesson from the East Asian experience is the pivotal role that the
political leadership played in directing their growth paths toward ensuring economic progress
and development. This also underscores the importance of a stable and enduring political
environment that is conducive for establishing the ideal condition for economic and industrial
take-off, particularly focusing on technology-driven industrialization to support exports. The
political stability should encompass adequate security to foster the requisite environment
under which business and commercial activities can thrive.
16. Another important lesson from the Asian Tigers is the systematic and coordinated
policy intervention by the government to steer the economy to the right path. Worthy of
mention is the areas of industrial policies directed at developing strategic sectors of their
economies as well as the cooperation between the private sector and the government.
Government policies were primarily geared to ensuring private sector competition between
small and large companies as well as promotion of export-led growth.
17. The issue of research and development, (R&D) was at the front burner of the
development strategies of the Asian nations. These countries were able to adapt and
customize the products of R&D as the bedrock of their technological advancement to support
the export-led growth strategy. The adaptation of R&D was instrumental to ensuring the
diversification and widening of the export base.
Challenges of Nigeria's economic development and the leadership question
18. Let me state emphatically that though the Nigerian economy has achieved some
considerable progress, the accomplishment is far below her realizable potentials given her
abundant human and material resource endowment. The country is still grappling with
numerous challenges, which has continued to militate against the achievement of economic
transformation. First, from the standpoint of leadership, the country is seriously beset with
numerous shortcomings in the leadership arena, be it in the spheres of politics, corporate or
at the community level, etc. In fact, the case of Nigeria could be rightly classified as
leadership decadence across all spectrum of human endeavour. The bane of leadership in
our environment could conveniently be grouped into the following broad categories.
•
Prevalence of executive/legislative/judicial lawlessness and corruption within the
body polity as the personal interests of many leaders override collective goals. The
frenzied quest for wealth over and above all other considerations has rendered
leadership most ineffective.
•
Abuse and manipulation of ethnic relationship by leaders in authority by way of
nepotism, tribalism, favouritism and religious bigotry.
•
Lack of leadership education and skills to discharge expected roles and perform
leadership duties effectively.
• Inadequate motivation of subordinates and followers leading to disconnect in
leadership and followership relationship.
19. Second, the economy is yet to achieve the necessary structural changes required to
jump-start rapid and sustainable economic growth. The attitudinal and structural changes
needed for economic transformation are still very much lacking. This is traceable to the
manifestations of structural rigidities occasioned by the apparent weak linkages existing
among the primary, secondary and the tertiary sectors of the economy. The huge foreign
exchange inflows from oil have also not been effectively harnessed to ensure a
comprehensive diversification of the economy.
20. Third, the economy is faced with widespread dilapidated and dysfunctional economic
and social infrastructure. This has hindered the growth of the economy, and was the result of
decades of neglects, weak technological base and poor maintenance culture over the years.
It is also a reflection of the low research and development efforts on the part of the
government.
21. Fourth, corruption has become endemic and has continued to ravage the entire strata
of the society. In fact, corruption is a direct result of the weak leadership, poor value and
reward system in the country. According to the Transparency International 2012, Nigeria's
position in the Corruption Perception Index for 2011 was 143 out of a total of 183 countries
with a score of 2.4/10, which clearly reveals Nigeria as one of the most corrupt countries in
the world.
22. Fifth, the menace of weak governance constitutes a serious challenge to the various
efforts and reforms meant to achieve economic growth for sustainable development. Thus,
the prevalence of weak institutions, poor governance as well as poor ethical standards in
most public and private organizations, constrain the realization of economic policy objectives
of the government. The effect of all these have permeated the country's regulation and law
enforcement, rendering them ineffective.
23. Sixth, is the environmental factor, particularly the weak investment climate, owing to
the legal and institutional challenges as well as the spate of insecurity, which has continued
to constrain massive flow of investment in the key potential wealth-creating and employment
generating sectors of the economy.
24. Finally, policy incoherence and inconsistencies and occasional policy somersault also
pose a major constraint to economic development in Nigeria. Though, government policies,
plans and initiatives tend to be laudable, they are most often discontinued with any change in
regime. Thus, regime changes in the past had often truncated the implementation of good
projects and programmes.
Addressing the leadership challenges: what type is ideal for Nigeria?
25. Given the various challenges confronting economic performance in the country, one
pertinent question to ask is - How do we refocus our energies (political and corporate elites
as well as the ordinary citizens) to attain the much desired economic progress and
development? I am sure you all know the answer - Leadership rejuvenation at all strata of
our society. This is because leadership is the hub upon which every other thing revolves.
26. According to ATG Educational Series, leadership is the process or the ability to
motivate others to unite and work towards achieving a common goal. From the standpoint of
our current situation, Nigeria needs leadership at all the various levels of society to manage
the wide spectrum of our socio-economic and political activities. As the leader of all leaders,
the political leadership is very vital in achieving the total transformation of the economy as
seen in the case of the East Asian Economies that were able to transform over a space of
fifty years from minor to major players on the world economic stage.
27. For Nigeria, it is essential for the political leaders to be visionary and transformational,
to be able to see, project and assemble a vision of a desired future for the nation. In addition,
they should be selfless, engaging and motivational as these are the fundamental prerequisite
for mobilizing followership, particularly in a multi-ethnic, multi-religious and multicultural
society like Nigeria. As a motivator, leadership vision must be clear, attractive and attainable.
An engaging leadership would be able to build bridges across divides, and as such be able
to foster necessary harmony for collective good. Leadership that would be effective in a
setting like Nigeria must also be courageous to take radical and progressive
decisions/actions. Finally, such leadership must be committed, determined and persistent to
be able to realize a vision as well as attain the desired goals and objectives. As engraved on
the plaque on the wall of Ray Kroc an American businessman who was behind the success
of McDonald's Corporation:
"Nothing in this world can take the place of persistence. Talent will not;
nothing is more common than unsuccessful men with great talents. Genius
will not; unrewarded genius is almost a proverb. Education will not; the
world is full of educated derelicts. Persistence and determination alone are
omnipotent".
28. In the light of the foregoing quotation, Nigeria would require committed, determined,
and persistent leaders in order to be able to realize the collective vision and to take our
nation to the "promised land". Therefore, the attainment of the Vision 20:2020 to be among
the top 20 largest economies in the world by 2020 is contingent upon our contributions as
leaders in our various callings.
Concluding remarks
29. Ladies and Gentlemen, I will like to close my discourse with a quote that would serve
as watchwords in the discharge of our leadership duties and responsibilities. These words
are golden and would assist us in re-evaluating our ways and actions as leaders. According
to Phil Dourado, author, Speaker, Leadership Development, Speaker and Journalist, and
Creator of the Leadership hub:
"People need to know who you are and what you stand for; before they
agree to be led by you. Leadership is an agreement. You lead with
permission. If your self-story is not absolutely consistent and based on
integrity - who you really are - people will see through it and not give you
permission to lead them. Most often, they will hide their disagreement and
your apparent leadership will be fake".
30. Given the inability of Nigeria to realize its development aspirations during the past
52 years of political independence, and the seemingly forlorn hope for realistic progress by
many citizens, it is obvious that the country needs a new kind of leadership. Such leadership
should be inspiringly creative and resolutely courageous. It is this kind of leadership that will
be capable of taking the country into new frontiers of development, as has been
demonstrated by the Asian countries that I had enumerated earlier. Leadership with a
different kind of mind- leadership that sees beyond the obvious to spot the unusual solution
if we are to realize the aspirations of the Vision 20:2020 document.
31. Eminent Personalities, Distinguished Ladies and Gentlemen, it is on this note that I
implore all of us to imbibe the right attributes of leadership in our various endeavours so as to
able to reposition our various organizations on a higher pedestal towards advancing the
course of our national development and ultimately improve the welfare of our people.
32. I thank you all for your attention.