A former presidential candidate, Kingsley Moghalu, said that achieving true economic diversification would be hard for a country like Nigeria that is resource-dependent.
He said this at the 2021 Annual Conference of the Nigerian Economics Students Association (NESA) at the University of Port Harcourt.
His speech was framed around the theme, “Economic Diversification and the Wealth of Nations: Lessons and the Path Forward for Nigeria,” where he said that for Nigeria to attain true diversification, it would need “string government policy engagement” with the country’s economy.
Moghalu, who was also the former deputy governor of the Central Bank of Nigeria (CBN), said that the country had gone through several economic changes that have exposed its economy to “extreme liberalisation of trade” without a strong industrialised foundation.
He said, “We must understand that true economic diversification is a very difficult goal to achieve for resource-dependent countries such as Nigeria. And yet, it remains an imperative (sic) for our country to become a part of these elite clubs.
“Lessons show that successful diversification requires strong government policy engagement with the economy because there must be deliberate intent. This in turn calls for both political will and competent economic management, which is not the same thing as statism or populism.
“In more recent years, Nigeria suffered from a decline in structural economic thinking led in the past by economists such as Dr. Pius Okigbo, Dr. Adebajo Adedeji, and Professor Sam Aluko, and a somewhat premature shift, under pressure from the Bretton Woods institutions the IMF and the World Bank, to extreme liberalisation of trade without an appropriate foundation of industrialisation that would have made us more competitive in the global economy with diversified exports.
“The failure of the Ajaokuta steel industry represents a tragic failure of political leadership for economic transformation in Nigeria, as iron and steel are an important basis for an industrialised economy.”
On the way forward, Moghalu said that real change can only be achieved when politics is void of “crony capitalism of vested interests”.
He argued, “A competent political leadership that understands and prioritises economic development over the crony capitalism of vested interests, backed up by competent economic management and a capable state bureaucracy, is essential in realising the country’s quest for economic diversification.”