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Published On: Mon, Jul 23rd, 2018

Population crisis: Nigeria Analysts raise Alarm

Against increasing concerns about exploding population figures, Nigerian economists, in growing numbers, are raising their voices over an impending tragedy if the current growth rate of 3 per cent per annum is not flipped back.

Available data lays bare Nigeria’s romance with disaster. Recent IMF statistics puts Nigeria’s population at a stumping 199.5 million people making the country the worlds sixth largest nation by population. According to a few commentators, this may not have been much of  a problem if the country’s gross domestic product (GDP) was running ahead at a rate higher than its current 1.95 per cent. According to Mr Mustapha Chike-Obi, erstwhile chief executive officer (CEO) of Nigeria’s Debt Asset Managment Company (AMCON),at an interview held a few years back in Lagos, ”if Nigeria is to meet its development goals and defuse a ticking unemployment bomb; it needs to grow its GDP by a minimum rate of between 12 and 15 per cent per annum over the next ten years”. Chike-Obi was convinced that the effect of rapid population growth and slow annual GDP rates would conspire to create a number of crises that would, ”leave us all in a Malthusian trap. In other words we would all end up living lives that are nasty, brutish and short”.

But perhaps not everybody. However, a large number of Nigerians, especially the youths would find  themselves ending up on a dung heap between, what Chike-Obi calls,  ”a rock and a hard place”. Existing statistics is definitely daunting. For example, sixty per cent of Nigerians are presently between the ages of zero and 35 years of age. Of these gangly youths those between the ages of 18 and 35 years of age that are unemployed represent a staggering…per cent, with the national average unemployment rate hovering above…per cent, this creates a major point of social dislocation and instability.  Indeed according to observers, rising unemployment and population, ‘provides the fuel needed to ignite an economic disaster of historic proportions. It is not tribal or ethnic competition for resources that will do us in, but the sheer pressure of coping with a restless horde of young people who are angry, frustrated and disillusioned” notes Suraj Akinyemi, an economist and managing director of medium-scale animal feed company Surak 713. Akinyemi argues that, ” our crisis will be magnified to the extent of our denial of the problem. Not addressing the population issue is clearly burying our head in the  sand”.

Already the pressure of the population on domestic resources is showing up in various quarters. Nigeria’s GDP per capita is one of the lowest on the African continent with recent GDP per capita being in the neighbourhood of N2,180 (2018 projections) as against South Africa’s $ 6,180, Egypts $2,501, Ghana’s $1,663 and Liberia’s $720.To be sure,over the last five years GDP per capita has dipped from N3,082 in 2013, N3,312 in 2014, N2,766 in 2015 , N2,206 in 2016 and N1,955 in 2017. The slide in per capita output reflects a burgeoning population growth that has increasingly slapped down  national output as both agricultural and service sectors (previous bailiwicks of growth)stumble in in the face of escalating ethnic crisis and rising operating costs of telecommunication firms(telcos), transportation and logistics companies and financial service institutions. Observes Adeola Afolabi, executive director Bravo Nigeria Limited, ”lower output per person means reduced spending power and slower economic growth . A large population might have merits in some context, but when output is lean and money scarce, it is a millstone around an economy’s neck”.

The pressure of poor economic infrastructure has made business development in Nigeria difficult, say analysts. This in turn has slowed sectoral growth and worsened local unemployment. ”If we are going to get out of these dark and dangerous woods”, notes Segun Atere, head analyst at Apel Assets and Trust Limited, a Lagos-based funds manager and stock broking outfit, ”we have to start thinking strategically about economic development, rather than worry ourselves to death about the rise in aggregate price level, we need to think about production lines rather than birth sizes. Inflation targeting has its merits, no doubt, but with a ballooning population and declining industrial output, rubbing powder on the face to look pretty is less important than finding food for the stomach”. In other words, according to Atere even though inflation-stalking looks reasonable, ”getting stuck in the jaws of the fear of an inflation monster could easily become worse than the monster itself”, he insists.      

Inflation rate in Nigeria has dropped from a frightening 18.8 per cent in January 2017 (suggesting that the Naira would lose half of its value every three and a half years) to a much more tolerable 11.61 per cent in May 2018. The Central Bank of Nigeria (CBN) has insisted that it would sustain its tight monetray policy to head off expected inflationary headwinds that may accompany the 2019 general elections.  The consequence of the CBN policy would be high interest rates and lower industrial expansion which in turn would halt growth in employment.

A major fishbone in the throat of policy makers concerning the Nigerian population issue is the inconvenient truth that while the Southern parts of the country has seen population growth rates fall, the North has sustained high and rising rates. A large number of states in the Northern parts of the country advertise annual population growth rates between 6 and 7 per cent which is in stark contrast to rates of between 4 and 5 per cent in the South West and 3 and 4 per cent in the South East. The difference in demographic population growth rates have grave implications.

With the North growing at almost twice the annual size of the South in terms of population, most Northern states and their economies will come under severe pressure to provide social and economic infrastructure to support the looming numbers. Unfortunately with insurgency decimating Northern economies, the slowing down of productive agricultural output will create a grim food crisis that will further compound the country’s security problems. According to Surak 713’s Akinyemi, ”few people understand the meaning of disaster until it stares them in the face, unfortuantely Nigeria is close to that point as demographic realities tear the country’s fragile stability at the seams”.

With the North growing by twice its population size every ten years as against the South growing by twice its size every eighteen years, the ethnic battle for control of economic and physical resources is well in play. ”We have got ourselves locked in a peculiar mess” says Chris Okenwa, a public policy economist  and strategy adviser with Econotrack, an economic research and data company. According to Okenwa, ”the demographic shifts going forward will pit Northern states against the Southern counterparts s as the Southern states diligently contain their population and try to raise regional GDP per capita while Northern states wilfully allow their populations explode until the internal struggle for food and survival turns relatively peaceful cohabitation into a jungle frenzy”. The intermittent skirmishes between herdsmen and farmers in the middlebelt already foreshadows the grave conflicts likely to arise in the near future across various parts of the country.

As population continues to fester like a raging cancer, the economy will slip into one of its worst economic spells in over half a century. Lower per capita income will drag down consumption, savings and investment, while tighter  monetary policy will increase interest rates and slow down production and manufacturing output, rising population without spending power will constitute a dead weight burden to the economy. The consequence of this toxic alchemy is, ”a Malthusian disaster that is better imagined than experienced”, says econotracks, Okenwa.

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