Extreme Poverty, Unemployment Lingers Despite Huge Annual Budgets

Extreme Poverty, Unemployment Lingers Despite Huge Annual Budgets

FG, 36 states spend over N26.92 trillion in 4 years


Despite its Federal Government and 36 states spending a staggering N26.92trillion in four years, Nigeria is still rated one of the world’s poorest countries as of 2018, according to multiple statistics. While the Federal Government received more than N19 trillion between 2015 -2018, the country’s 36 states got more than N15 trillion during the period.
AljazirahNigeria’s investigation covers the period when President Mohammadu Buhari took over in 2015. In spite of the huge revenue yields largely from burgeoning crude oil sales at the time, the governments at the federal and state levels did not invest in developing infrastructure, creating jobs and alleviating poverty.
Currently, Nigeria is ranked third among countries with the highest population of extremely poor or people with abject poverty in the world. The United Nations’ Sustainable Development Goals, SDG, to end extreme poverty by 2030 is unlikely to be met.
A new report by The World Poverty Clock shows Nigeria has overtaken India as the country with the most extreme poor people in the world.
India has a population seven times larger than Nigeria’s. The struggle to lift more citizens out of extreme poverty is an indictment on successive Nigerian governments which have been blamed for mismanaging the country’s vast oil riches through incompetence and corruption.
The 86.9 million Nigerians now living in extreme poverty represent nearly 50% of its estimated 180 million population. As Nigeria faces a major population boom, it will become the world’s third largest country by 2050 and it’s problem will likely worsen, especially as having a large swathe of people still living in extreme poverty is an Africa-wide problem.
Crucially, of those countries in the top ten, only Ethiopia is on track to meet the United Nations’ SDG of ending extreme poverty by 2030. Outside the top ten, only Ghana and Mauritania are also on track with the SDG target. Indeed, of the 15 countries across the world where extreme poverty is rising per World Poverty Clock data, 13 are in Africa.
No doubt, the mission to end extreme poverty globally is already at risk. By July 2018, 83 million people would have been lifted out of extreme poverty since January 2016 but the number is 37 million people fewer than the required number to meet the 2030 target.
In its latest report on the world’s poverty index, titled “Prosperity for All – Ending Extreme Poverty,” the World Bank listed Nigeria among five countries with the highest number of poor people in the world.
The other countries are India, China, Bangladesh and the Democratic Republic of Congo. India accounts for 33 per cent of the world’s poor followed by China with 13 per cent while Nigeria comes third with seven per cent. Bangladesh is ranked fourth with six per cent of the world’s poor and Democratic Republic of Congo fifth with five percent.
According to the World Bank report, India, China, Nigeria, Bangladesh and the DRC are home to nearly 760 million of the world’s poor people.
However, data obtained from the National Bureau of Statistics, NBS, puts the population of Nigerians in poverty at about 112 million, representing about 67 per cent of the country’s 167 million population.
Currently, Nigeria’s per capita GDP stands at $1,555 per annum. South Africa, which is rated as the largest economy in Africa, has a per capita GDP of $7,336 per annum. While the country is basking in the euphoria of a rebased economy, which has make it one of the biggest economy in Africa, the reality at home is different, and indeed pathetic.
Data from the country’s statistics bureau show that Nigeria’s North-East and the North-West zones have the highest percentage of absolutely poor people while the least poverty ratings are recorded in the South-West and South-South zones. In many North-East and North-West States, the percentage of people rated absolute poor ranges from 68 – 81 per cent while states in the North-Central range between 60 – 74 per cent.
Explaining why Nigeria performs so abysmally in the poverty ratings, the outgone Minister of Finance and Coordinating Minister for the Economy, Ngozi Okonjo-Iweala, said the country is rated among the poorest in the world because of its large population. Irrespective of a country’s level of development, poverty is rated based on population, adding that is one of the most populated countries in the world, Nigeria is rated among nations with high poverty levels.
“India, a middle-income country, one of the largest economies in the world like Nigeria, is a big economy, but the largest number of poor
people in the world reside in India, China and other places,” the minister said.
“Most middle-income countries, including Brazil, have a large number of poor people that is the reality of today and Nigeria is no exception. And when the World Bank president was talking, he also talked about those countries. He mentioned that India is doing well and it has a large number of poor people.
“So, we should not try to single Nigeria out. The phenomenon we have in Nigeria is that we are growing but there are poor people everywhere,” she added.

A voodoo economic system
Activists and a development experts say the management of Nigeria’s enormous financial resources defies known economic logic. Hussaini Abdu, a development expert and country director, Plan International, said what the country earned from crude oil sales in the last 18 years tripled what it earned in its first 35 years of nationhood.
“When you check the first 35 years of our national history and compare it with the last 15 years of democratic governance, you find that what has been received as allocation now outweighs what we received,” Mr. Abdu said.
He added: “Check out the road infrastructure and you will find out that every dual carriageway including Lagos-Ibadan, Benin-Lagos, Abuja-Kano and many others were built during the first 35 years of our nationhood. Abuja city and all the major airports were built during the first 35 years of Nigeria’s nationhood. One, therefore, wonders what we have done with the resources we have gotten during the last 15 years because almost every mega project and infrastructure in the country was built before we attained democratic governance.”
Mr. Abdu insisted that it would be difficult for the country to make meaningful progress when only 30 per cent of the budgetary allocation of the federal and most of the state governments are used for capital projects.
He also blamed the nation’s woes on the flamboyant lifestyles of political office holders and top civil servants, who waste huge public funds in expensive and needless oversea travels and training, as well as in classy cars and perks. According to recent research carried out by ActionAid Nigeria, Mr. Abdu’s former organisation, over 10.5 million Nigerian children are out of schools in Northern Nigeria alone, with the figure averaging school dropouts in four African countries.
Given the huge funds received by both the Federal and state governments in Nigeria, the Director, ChristianAid International Nigeria, Paul Edouck, said money does not cure poverty.
“If money could eliminate poverty, the incidents of jackpot winners going broke or running crazy would not be routine,” Mr. Edouck said.
Mr. Edouck, a renowned activist cited cases where governments in Nigeria inaugurate water projects with water supplied from tankers and how lavish ceremonies are organised to reopen rehabilitated roads as reasons the country cannot make progress.
He said, “We should be glad that oil prices have plummeted and hopefully make our leaders consider cutting down on their excesses, including learning to travel on commercial flights and not on private jets.
“At present the voodoo economic system we run simply encourages ravenous behaviours by the wielders of state power. And the outcome is predictable,” he said. Until there is a true transformative change in the country, he argued, the squandering of riches will persist.
If not checked, Mr. Edouck warned that the continuous impoverishment of the people by the ruling elite would trigger a bloody backlash.
Based on investigations carried out by his organization, Rommy Mom, the president of Lawyers Alert, said the federal and state authorities spent more funds in running government than in physical development and the welfare of the people. “Most of the states are spending more on running their governments than on improving the welfare of their people and investments that will enhance their productive capacity,” Mr. Mom said.
He said the Nigerian version of democracy is a “government of the people, not by the people but for the political elite.” With the exception of Akwa Ibom, Bayelsa and Gombe States, he said the federal government and 33 state governments in Nigeria spent much of their budgets on recurrent votes.
According to him, only Akwa Ibom State committed 83 per cent of its 2017 budget for capital expenditure, more than the 70 per cent required for developing countries to ensure sustainable development.
During the same period, he said Gombe State earmarked 63 per cent of its budget for capital expenditure while Bayelsa allocated 60 per cent for the same purpose.
Mr. Mom also blamed the rising poverty and underdevelopment in the country to poor budget implementation, lack of oversight capacity on part of the legislature and executive recklessness.

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