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Fuel Crisis Amplifies Need For Economic Diversification

Fuel Crisis Amplifies Need For Economic Diversification

Editor's note: The hard case of fuel crisis continues to ripple through the Nigerian business, political and economic atmosphere. The Naij.com guest columnist Tahir Sherriff observes that the authorities will have to make an enormous effort to subdue the effects of the said crisis and eventually better the lives of Nigerians.

The views and opinions expressed here are those of the author and do not necessarily reflect the official policy or position of Naij.com.

Story highlights:

— What lies ahead of the country's dangerous reliance on oil?

— Change was what people voted for, but, with installed configurations, the more needed change is an economical revolution, one that sees the other crawling sectors rise to their feet and change lives.

— To reach the demands dictated by years of neglect, the effort required has to be enormous.

The fuel queues in Abuja stretch endlessly. Tanker drivers are sleeping lazily under mango trees outside the depots of oil marketers. Hundreds of thousands who have become jobless on account of the decision by oil marketer to stop the supply of oil are roaming the streets looking for alternative means of income. Workers are developing legitimate excuses for not arriving at work early. Everything somewhat points toward the nation's capital's slow, yet deadly grind to a standstill. All people do these days is talk about May 29. As the last political era ends, one painful question that cannot be discarded with the positivity that accompanied April elections is what will become of Nigeria afterwards? What lies ahead of the country's dangerous reliance on oil?

This question would easily have been answered had the Nigerian government adopted the prudent policy of judiciously investing or saving the bulk of the oil proceeds. Unfortunately, the reverse is the case: the government, over the years, has wasted the bulk of the oil proceeds on 'white elephant' projects that dotted the map of the country. Even the Niger Delta region was at a time engulfed in violence when local ethnic minorities began to agitate for a greater share of oil revenues. All this culminated to landing Nigeria on the US Department of State's warning list among other countries with "long-term, protracted conditions that make a country dangerous or unstable". Other nations were Algeria, Chad, Colombia, the Democratic Republic of the Congo, Iraq, Mauritania, Pakistan, Saudi Arabia, and Syria.

One unarguable thing here is this: the huge revenues from oil grants bestow an advantage to the Nigerian government to spend and invest massively without recourse to taxation. Oil sector can also contribute to development in the oil-rich economies through provision of intermediate inputs to the rest of the economy. These intermediate inputs include crude oil, gas and liquid feed stocks, as well as oil and gas into the refining, petrochemical, electricity and energy-intensive industries.

But the oil sector does not offer much opportunity for employment in Nigeria because it is more a capital than labor-intensive industry, and so, more people remain unemployed. This is the reason why the significant expansion of the sector over the years has not led to a similar increase in job creation.

Another, simpler, sufficient aid as to understanding the negative effects of such dependency is the development that was sparked in Lagos state when it was denied of oil revenue for political reasons.

The mere fact that Nigeria has been on standstill for the past few weeks over the decision of oil marketers to restrict the supply of fuel highlights this danger even more. Especially with the abundance of natural resources, especially knowing that the reason people went out en masse to vote for another candidate was to ensure that the country takes a different turn, especially since the slogan that gave birth to a political revolution was 'Change'. Yes, change was what people voted for, but, with installed configurations, the more needed change is an economical revolution. One that sees the other crawling sectors rise to their feet and change lives. One that ensures that there are less jobless youths in the northern axis to carry arms 'in the name of God', one that relieves the government of such extreme dependency of its people, as has been witnessed since the birth of Nigeria. That is what change is all about.

To reach the demands dictated by years of neglect, the effort required has to be enormous. Building transparent, effective and accountable institutions that truly serve people, as well as empowering the civil society and installing necessary configurations to enable a free press to strengthen our democracy is just one of the many tasks that lie ahead. But at this very moment, when hoards of tankers have blocked major roads in Port Harcourt and Lagos, the issue on ground is fuel scarcity. If the problem remains the same, then, to reach the venue of the May 29 inauguration, the over 50 heads of state will have to drive past the endless rows of fuel queues and witness millions of Nigerians lamenting the crisis. Yet, those who have now taken over the reins of power do not seem concerned about this; they seem more intensely concerned at wholly consolidating the much-waited power. Inauguration ceremony planners are working day and night to make a show of the transition, and the National Assembly is still locked in a political stalemate.

But even after political power has been adequately consolidated by those who now hold the high stakes, it is without question that the oil issue will remain a problem. Not only will the government be required to devise a workable plan to diversify the economy, or contend with the interests of the currently sleeping Niger Delta militants, it must first and foremost put an end to the epileptic nature of Nigeria's fuel crisis.

Fuel Crisis Amplifies Need For Economic Diversification

Tahir Sherriff

Tahir Sherriff is a Nigeria-based researcher, writer and social commentator with a recent focus on governance and participation, regional development and social change.

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