DOMESTIC
GROWTH VS. FOREIGN RELATIONS
The business of nation
building is a deliberate and strategic one. On account of the current reality
of the world being a global village, the place of international relations
cannot be underestimated. This is also coupled with the advantage of leveraging
to achieve an end or another by nations. However, it is quintessential for a
nation to approach each strategically in the pursuit of national development.
It is substantially the duty
of each nation to take responsibility for its growth and the welfare of the
citizenry. There can be no substitute for this in whatever form. The avenue to
achieve this includes government policies, legislations, regulations and ultimately
strategic plan. In fact nations like US, France, South Korea, Brazil, Singapore,
China, United Arab Emirate, and Qatar to mention a few that have all made it to
national prosperity take domestic responsibilities more seriously and this
influence a good chunk of their foreign and diplomatic relations strategies. It
will cause more evil than good for any nation to rate foreign relations higher
and above its domestic responsibilities. I will like to discuss from the
nations mentioned earlier, South Korea and China.
A piece titled: THE RISE OF
SOUTH KOREA, A LESSON FOR AFRICA published in NewAfrican magazine, April 2011
edition contains my captivation. With reference to a book titled Bad
Samaritans- The Guilty Secret of Rich Nations and Threat to Global Prosperity
by Ha-Joon Chang, it states:
…According
to Chang: The country’s obsession with economic development was fully reflected
in our education. We learned that it is our patriotic duty to report anyone
seen smoking foreign cigarettes. The country needed to use every bit of the
foreign exchange earned from its exports in order to import machines and other
inputs to develop better industries.
Valuable
foreign currencies were really the blood and sweat of our industrial soldiers’
fighting the export war in the country’s factories. Those squandering them on
frivolous things, like illegal foreign cigarettes were ‘traitor’. Imagine any
African country doing that? It would be promptly charged with “draconian laws”.
But South Korea went even further than that. “Spending foreign exchange on
anything not essential for industrial development was prohibited or strongly
discouraged through import barns, high tariffs and excise taxes (which were
called luxury consumption taxes),” says Chang. “Luxury items included even relatively
simple things like small cars, whisky or cookies…
“Foreign
travel was banned unless you had explicit government permission to do business
or study abroad. As a result, despite having quite a few relatives living in
US, I had never been outside Korea until I travelled to Cambridge at the age of
23 to start as a graduate student there in 1986.”
But
wait for this: Like the strict rules of currency transactions in Europe under
the Marshall Plan, the South Korean Government took absolute control over the
country’s then scarce foreign exchange. Chang recalls that violation of the
foreign exchange controls could be punished by the death penalty!
For China, from the same
edition of the NewAfrican magazine, a piece titled FROM POVERTY TO WEALTH… HOW
THE OTHERS DID IT states thus:
Like
the USA in the mid-19th century, or Japan and South Korea in the
mid-20th century, China used high import tariff to build up its
industrial base. Right up to the 1990s, China’s average tariff was over 30%.
Chang admits that China has been more welcoming to foreign investment than
Japan or South Korea were, but China still imposed foreign ownership ceilings
and local content requirements that demanded the foreign firms should buy a certain
proportion of their inputs from local suppliers.
Contrary
to the liberalisation theory and hands-off-by-the-state sermons preached to
Africa, China used heavy state intervention and an enlightened state-owned
enterprise (SOE) strategy to grow its economy to a point where it is now an
economic superpower vying for global domination with the more established big
boys. In the past, all Chinese industrial enterprises were owned by the state,
but today, the SOE sector accounts for 40% of industrial output.
This is heavy food for thought
for Nigeria. To the extent that South Korea and China understand the place of
international relations, they were strategic about it and will not allow it
dominate their domestic life but otherwise.
I indeed agree with a number
of us that have maintained the position that Nigeria does not need to adopt the
approach of other nations to development but a Nigerian solution must be designed
for the Nigerian problem. However, some factors are fundamentally constant on
nations’ path to development. A cursory look at the China’s approach with that
of Nigeria reveals the Nigeria is also adopting Foreign Investment (through
direct and portfolio investment) and the Local Content recipe.
On Foreign Investment, Nigeria
is making huge effort to attract foreign investors, more so with some
incentives to encourage same. There has been growth in economic activities of
the nation but the nation is not recording the expected attraction. This may
not be unexpected in view of the poor infrastructural facilities, insecurity
among others bothering the nation.
The salient question to ask is
how far foreign investment will help the nation to achieve the desired economic
prosperity. Being objective, any foreigner dealing on the Nigerian soil has the
guaranteed right of repatriating the profit realized to his home country to the
tune of 100%. So if the foreigner repatriates the profit, the money so made is
no more exchanging hands within our system. The solution is then cosmetic. The
Lagos Chamber of Commerce and Industry boss stated recently that a real and
sustainable growth in the nation’s development will be achieved when we have
more Nigerian investors whose moneys will remain and revolve within our system.
By this we won’t be at the mercy of foreigners.
With respect to Local Content,
Nigeria in 2010 promulgated the Local Content Act. The objective of this is
essentially to increase value-added content, thereby contributing to national
economic development as well as that of stakeholders, partners, clients,
companies, employees and contractors, technology transfer and develop local
know-how. This is quite admirable being an appropriate step forward. But there
appears to be more emphasis on the Oil and Gas industry, then others passively.
Even though this industry accounts for about 87% of our nation’s income, we
should always remember that there are other viable sectors which have been ignored
upon the discovery of oil in Nigeria.
Further to this,
implementation, monitoring and enforcement are major challenges to a number of
government policies, programmes and enactments. The Local Content Act is facing
its own now. More than this, the workability of this law is frustrated by a
number of factors including inadequate access to finance, quality of our
personnel or manpower, sabotage and poor infrastructural facilities that should
aid the functioning of our local industry. In all, enacting a law such as the
Local Content Act without considering and ensuring its effectiveness by other
factors amounts to a substantial effort in futility.
In the course of my study on
Nigeria, our economic history, growth strategies and plans (which is still in
progress), I discovered that we have a number of documents which if lived up
to, would have moved the nation farther than where it currently is. As I do not
intend to turn this piece into a thesis, I will briefly mention the National Economic
Empowerment Development Strategies (NEEDS) which evolved from the nation’s
compliance with the Millennium Development Goals (MDGs). Like the era of
National Development Plan in Nigeria, the NEEDS should be the major influence
in drawing the national Budget, Legislations and Policies.
It is imperative to note that
the goal of a nation’s development is first and foremost a deliberate and
strategic project. Leaders can go about other nations seeking for collaboration
in moving a nation forward, it will most certainly not be to the advantage of
the aspiring nation.
In conclusion, our national
growth will not depend more on our foreign relations or collaboration but more
on our domestic seriousness, deliberate and strategic plans to achieve
development. In fact, foreign relations will not guarantee national development
in the absence of local seriousness save we are travelling back into
imperialism.
Olusola Akinyemi Esq.
President
The Joseph Initiative, Lagos.
No comments:
Post a Comment