SAP, NEEDS and Nigeria's Industrial Development

Before discussing the crux of the subject matter it would be appropriate to explain the background of the two major concept of discussion which is SAP and NEEDS.

STURUTURAL ADJUSTMENT PROGRAMME (SAP)

Structural Adjustment Programme (SAP) was introduced following the collapse of oil market in the early 80’s which saw Nigeria’s per capital income plummet from about $1,000 to $300 and the drastic fall in the level of foreign exchange earnings and government revenues. Nigeria introduces SAP and embarks in it implementing in 1986.

The emphasis of the SAP was on deregulation, market liberalization, demand management through appropriate prizing, floating of the exchange rate and the promotion of agriculture and other rural based export oriented economic activities. It was also expected to promote the growth of resource based industrialization in place of the prevailing import substitution strategy which had become unsustainable due to foreign exchange scarcity and the consequent inability to import needed raw materials, spare part, skilled labour e.t.c to support industrial production.

Inability to stay the course of reforms, low levels of investment large fiscal imbalances, among other reasons, prolonged the life of the programme which was originally designed to last for two years to eight years until there was a regime change. Despite the regime change, the features of that programme have remained with significant elements of it reflected in vision 2010.



National Economic Empowerment and Development Strategy (NEEDS)

The objective NEEDS is to enable Nigeria achieve a turn around and grow a broad based market oriented economy that is private sector led in which people can be empowered so that they can, as a minimum, afford the basic needs of life. It is a pro-poor development strategy with sources of economic empowerment being gainful employment and provision of social safety net for vulnerable groups.

Most of the targets in the NEEDS documents are set in quantitative terms. Their achievement must also be tracked in quantitative terms. The essential pro-poor growth indices are largely what are classified as socio economic data; they include access to employment, income and consumption per capital, access to basic education, health care. (Mortality rate, HIV/AIDS prevalence, general health status, life expectancy etc) water and accommodation and indeed the structure of the distribution of income between one period and another in other to capture the changes arising from the implementation of reforms.

According to some analyst structural Adjustment programme (SAP) has been rechristened to national economic employment development strategy (NEEDS). To them if the implementation of SAP was include a “sin” then it must be a nurturing one because the economic reformation is still being undertaking by the current PDP-led democratic government, they are also of the opinion that Nigerians should pray and hope that the same unrepentant agents that sabotaged “SAP” do not do the same to NEEDS.

Structural adjustment program (SAP) was introduce to place Nigeria on the path of industrial development in the 80’s so many economic ill, where visible and problems in deference forms i.e. retested growth manifesting in persistent balance of payments deficits, raging inflationary trends, conspicuous taste for foreign service goods, foreign debts and seemingly over-valued naira. SAP goals were to be balanced growth, stable prices, favorable balance of payment and full employment, but unfortunately for Nigeria from the time of SAP it because a nation of consumer of second – hand goods and products. The average Nigeria could no longer afford any new thing except those Nigerians who have profited from government contracts and favors.

With the failure of SAP to make any positive impact in Nigeria ’s industrial development, the Olusegun Obasanjo administration, backed by arrays of World Bank experts ingeniously bull-dozed another economic package on the nation elegantly presented as “the National Economic Empowerment and Development Strategy (NEEDS). The package which would take care of short term and long term needs, according to the carefully selected and brilliantly tutored protagonist, would represent many good tidings of “life more abundant” for all Nigerian.

The emphasis of NEEDS is on the provision of good roads, better schools, responsive health care system, water for drinking and agricultural purpose, safer streets and of course, food on table. There is no doubt that the concepts of NEEDS are lovely by any standard, even if they were not new or original. However, unfortunately, the dream of NEEDS evaporated with the departure of the architect and his eminent World Bank experts.

Between SAP and NEEDS they have not change the lives of Nigerians. Indices released by various local and international organization shows that Nigeria is not achieving the desired industrial development. Nigeria cannot generate enough mega watts of power for its industrial development and has led to closure of many industries in the country. Corruption in both public and private sector has been a major set back for Nigeria to achieve any gain in industrial development.

Agricultural sector is not growing at any appropriate rate with less than 50% of the country’s cultivable land uncultivated.

90% of the land under cultivation in being tended by small farmers using largely antiquated production techniques. Nigeria contrary to goals of SAP and NEEDS spends $2.8 billion dollars to import food for local consumption. 90 million of the country’s, 140 million people face food insecurity and cannot afford three square meals a day, with over 70% of les citizens living below poverty line.

SAP and NEEDS are implemented for the purpose of chasing the lives of Nigerians. On the other hand SAP and NEEDS tend to increase poverty and hardship on Nigerians.