Roman Oseghale, an Architect, Consultant, and a Business Analyst is the Head Consultant of IntelServe Inc. a Canadian company which is into Consulting and Business Analytical Services spoke at The Platform on May 1st, 2017 on developing sustainable economic growth for Nigeria. Mr. Oseghale argues that Africa which is one of the 6 continents is the richest in Mineral Resources but the poorest in per capita income, he noted that 1/3 (33.3%) of all earths mineral resources is buried in Africa, 2/3 (66.6%) of all global mined diamond comes from Africa, 1/10 (10%) of global oil reserve is in Africa, 75% of all cocoa beans is from Africa, and Africa is home to some of the rarest mineral resources.
Presenting a research that cost him about 600 hours of work, demonstrated how Investing in Human Capital Development has been the secret to how progressive nations have developed a Sustainable Economy and growth over the last 60 years. He stated that the Netherlands which does not grow cocoa processes 13% of all cocoa beans worldwide and Europe and Russia which equally don’t grow cocoa processes 38% of all cocoa beans, and the tens of products manufactured from cocoa are shipped back to Nigeria and Africa to be sold, and while the worldwide cocoa industry is estimated to be over USD$100 billion, Africa’s share is just 2% percent (USD$2 billion) despite producing 75% of the cocoa beans.
He stated through his research that developing a Sustainable Economic Growth ensures both economic and political stability in any country and is the gateway to creating wealth, building confidence in any economy and prevents the devastating and inefficient impact of corporate premature failure and death. Using analysis from both Business Survey and Business Intelligence and gathering both qualitative and quantitative data, Mr. Oseghale took the country back 57 years to 1960 and matched these data along timelines to know where Nigeria deviated from the progressive economic growth of the 60’s and 70’s. He also matched the data with those of 80 other countries across the 6 continents for the 57 years to be sure of his hypothesis.
He stated through his research the direct correlation between education expenditure and per capita income of countries and that all progressive countries were operating the Knowledge Economy, he stated that progressive countries develop individuals and as they earn more or create wealth, it ultimately increases the GDP of the country. He stated that Nigeria and most African countries were still operating the mineral resources economy and if the country was to make progress it must switch over to the knowledge economy and treat education as an investment rather than an expense stating that education is an economic tool for growth and sustainability.
He stated through his research that in the 60’s and 70’s, and early 80’s, Nigeria invested in education pushing to reach the United Nations stipulated mandate of 26% of budget or 5% of GDP on education Investment both on Federal and State levels, and reached an all-time high of 4.9% of GDP in 1981. He argued that for the UN to have stipulated that 26% be invested in Education and 15% in Health, a combined investment of 41% of the budget on investments which has to do with direct investments on human capital only proves one thing…..that Human Capital was the greatest assets and true wealth of a nation and not mineral resources as Nigeria and most African countries seem to think.
The highlight of his presentation was how the research showed how Nigeria was ahead of countries like Egypt and a lot of the Asian countries in Per Capita Income in the 70’s and early 80’s when Nigeria heavily invested in Education and treated it as an investment while those countries did not invest as much in education and treated education as an expense. But the reverse was to start happening from 1982, these other countries started investing heavily in education building a knowledge economy having realised that the knowledge economy was the future and the key to economic growth and sustainability while Nigeria kept reducing its education expenditure and reaching an all-time low of 0.77% of GDP in 1991 and it has remained at 0.8% annually ever since. While population was increasing, Nigeria’s education expenditure was reducing over the years and the country did not increase education expenditure in 30 years.
In 1981 at USD$3.038b representing 4.9% of GDP, Nigeria’s education investment remained below USD$1b for 20 years, between 1986 and 2006, and only climbed to USD$3.3b in 2011 after 30 years. His research also shows that no nation amongst the 80 countries used for the survey and research ever reduced education expenditure for more that 3 to 4 years in a row but Nigeria did not increase hers in 30 years. He noted that Nigeria was the only country that had the highest increase in population between 1981 and 2014 (134.5%) but only increased education expenditure by only 53.7%, while countries like Egypt increased in population by 101.5% and increased education expenditure by 1,709%, Thailand increased in population by 40.1% with increase in education expenditure by 2,625%, and Indonesia increased in population by 68.5% but increased education expenditure by 2,469% in 33 years from 1981 to 2014, and this is the reason these countries are ahead of Nigeria today.
The research also showed that the Federal Government has only invested USD$48.8 billion in education in 44 years (1970 – 2014) despite having a large and fastest growing population compared to countries like Brazil that has invested USD$1.5 trillion, Chile USD$120.5 with just 10% of Nigeria’s population, Mexico USD$882.6 billion, Canada USD$1.6 trillion, United States USD$17.2 trillion, United Kingdom USD$2.7 trillion, Germany USD$3.5 trillion, Egypt USD$148 billion, South Africa USD$354 billion, Thailand USD$218.9 billion, and Indonesia USD$222 billion. He stated that these countries and the others used in the survey treat education as an investment and economic tool of growth and sustainability, and that is why they have a progressive economy.
The research also highlighted the cost of our negligence, how Nigeria’s public education sector and infrastructure is now decaying and the country not able to meet up with the massive number of students seeking university admission yearly. He also stated that most of the kids are now seeking admission outside the country which is now costing the economy billions of dollars yearly, and while we may think the country is only paying school fees and upkeep, Nigeria is losing billions in Intangible assets annually as the country is losing its best brains.
He concluded that government must start treating education as an investment rather than expenditure and must immediately return the country back to the economic model of the 70’s when government invested in Human Capital Development and provided the citizens with the right skills noting that the knowledge economy was the future and no nation has ever recorded progress in economic growth and sustainability with the relegation of education.
He also stated that government should develop skills acquisition centres, stating that education does not just end with students graduating from the universities but they must be armed with the right skills to succeed and increase productivity, which ultimately benefits the country and that government should provide incentives of low interest loans for graduates of skills and acquisition centres who wish to go into manufacturing, he stated that this is the model the Asian countries have been practicing and that’s why they have been able to turn their countries to the manufacturing hub of the world.