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Nigeria, Africa must stop over reliance on Chinese economic system

NWALI Tochukwu F

This is an extraordinary, unexpected and unusual time in the history of mankind. It’s a classic example of force majeure: lockouts; shutdowns, unexpected legislations, global economic disruptions.

The World Health Organization (WHO) has classified the Coronavirus outbreak as a global pandemic. From Asia, Europe, America, Canada to Africa, the unseen enemy ravages, attacking and killing its victims unprovoked!

The world is caught in a web of conspiracy theories and contradictions, such as 5G conspiracy theories. 5G is the 5th generation of wireless communication technologies network that started full operation in Wuhan, China. Like its predecessors, 2G, 3G and 4G that had been in Nigeria. Yet, no scientific backing to the above claims linking the virus to 5G network as of today.

It caught the world leaders, the scientific community and the world unaware. We’re helpless in the face of a war of the virus attack.  I’m unaware if the world has ever experienced a situation like this before! More than a war situation-fighting an unseen enemy called “virus,” that spreads when someone who is infected coughs or sneezes which may contain the virus. No universal scientific verified drugs that cure it as of today, April 7, 2020. Only God’s intervention and showing the scientific community the treatment and cure for the virus will save humanity from going into extinction. God forbids!

How did we get here? The spirit of the Igbo proverb came into my mind that says that “a man who does not know where the rain began to beat him cannot say where he dried his body.” Chinua Achebe. Every occurrence or event either good or bad has its origin. If we act like that man who doesn’t know where the rain started to beat him, then we are heading towards more destructive ends.

Another Conspiracy theory of Coronavirus has its origin from Wuhan-the ground zero, China. It started in a province; among community dwellers, from the animal meat market dealers. Some encaged illegal animal trade with an animal suspected to be virus carriers that is transmissible to human beings. Such species of animals include Snakes, Bats, Rats, and other poisonous animals.

This particular conspiracy theory has more scientific linking of the virus based on the community of food and nutrition findings in that city of Wuhan. Another reminder of the Igbo adage that says, “If one finger touches the oil it spreads to all the other fingers.”

In the first quarter of 2020, that disobedience of the few has turned out to be pandemic, ravaging and disrupting world economic order and sending precious souls to an early grave. Death came knocking on the door and killing without remedy at sight. The world is truly a global village, what affects one person affects all. Time has come for us to obey God who created ALL things. Evil enters like a needle and spreads like an oak tree… Respect and follow God’s commands in all your ways. Humanity has deviated and started questioning God’s Supreme Authority. Read the Bible according to Book of Leviticus Chapter 11:1-47, what is Clean and Unclean Food that was handed down to Moses and Aaron. Disobeying those instructions from Health Authorities by some wicked animal meat sellers has caused deaths of many and destructions of destines.  The consequences are enormous and unquantifiable. We become victims of one sin…

The Economic Impact of COVID19 to Key Sectors in Nigeria and Africa Continent

Nigeria and Africa have come through a period of prolonged political and economic uncertainty and policy somersault. Nigeria government who depends on China for virtually everything toothpicks, agricultural equipment, machines and borrowing money and what have you, are now at the mercy of Chinese government on how to continue the execution of contract awarded, importation of products that are manufactured in China may cause more delays and eventual terminations if the spread continued that are grounding economic activities to deadlock.

 

First, it created a huge refund liability.

The Chief Executive of International Air Transport  Association (AITA), Alexandre de Juniac, said at a media briefing that globally; airlines have a $35 billion liability for tickets sold but which are unflown (partly or fully unused).

Secondly, in the Nigerian travel industry, some international airlines such as British Airways and Virgin Atlantic Airways and other airlines have adopted the process that issues vouchers in place of refunds of tickets to affected passengers. Canada, Colombia and the Netherlands have decided to allow airlines to issue vouchers in place of refunds. This will enable airlines to preserve the cash that they need to keep cargo operations running and preserve their ability to be fully operational when we can safely re-start the industry.

When borders are closed and people’s mobility is limited by governments, our business disappears. And, of course if we cannot move people, that impact is felt across the economy, not least of which in the tourism sector.

And when 70 percent your business vanishes overnight, there is no amount of cost-cutting that can adequately fill the gap.

Nigeria government needs to take an extraordinary measure in extraordinary circumstances. By providing a vital buffer period for airlines to keep operating. Not just the airlines, but other small and large businesses, and large companies. This will help the airlines to mitigate, stay afloat and avoid huge workers lay off in this period of economic disruption. This is being done in other countries; the United States of America Economic Stimulus Package call PPP- Paycheck Protection Program loan, Canada, Italy, Netherland, France and Spain etc. This to protect small the business and large businesses with their employees.

When the public health crisis abates to the level where it is safe to res-tart the economy, the airlines must be ready to go. The recovery will be slower and much more painful if airlines are not able to support trade and tourism.

 

Time is more reap for Nigeria and the African continent to put on their thinking caps in other to break away from the bondage and stronghold of Chinese in our local market and economic activities. Nigeria political leaders should start asking hard questions of what is the economic model that works in our locality. From Manufacturing of local products for local consumption and exportation, building and maintaining health institutions with modern health technological equipment and creating a contusive business environment for private driven economy. Creating grants, loans and sustainable borrowing schemes for Small- and large-scale businesses to access funds at Zero interest rates.

 

In doing that, you will unlock the entrepreneurial spirits of Nigerians who are by nature, endowed with the industrial and determined spirit to strive irrespective of the harsh economic environment being experienced today.

 

Its reported that uncertainty regarding the spread of COVID-19 is high and its impact on Africa is expected to be serious, given the continent’s exposure to China. So far, cases have been reported in Algeria, Cameroon, Egypt, Morocco, Nigeria, Senegal, South Africa, Togo and Tunisia. If there the widespread outbreak of COVID-19 in Africa it could overwhelm already weak healthcare systems in Nigeria and the region.

 

According to ratings agency, Fitch, the Coronavirus outbreak will have a downside risk for short term growth for sub-Saharan African growth, particularly in Ghana, Angola, Congo, Equatorial Guinea, Zambia, South Africa, Gabon and Nigeria – all countries that export large amounts of commodities to China.

 

Take a critical look at the Chinese Economic Model: The socialist market economy (SME) is the economic system and model of economic development employed in the People’s Republic of China. The system is based on the predominance of public ownership and state-owned enterprises within a market economy. Its combination of features of the market economy and planned economy.  Its success was based on a mixed economy that incorporated limited capitalism within a command economy. The Chinese government’s spending has been a significant driver of its growth.

Practical Solutions:

The building of manufacturing Industries clusters, Production and Technology Hubbs among six geopolitical zones in Nigeria. The six geopolitical zones are North-Central, North-West, North-East, South-South, South-East and, South-West. How do I mean? Industry clusters are regional concentrations of related industries. Clusters consist of companies, suppliers and service providers, as well as government agencies and other institutions that provide education, information, research and technical support to a regional economy. This can be achieved through state-owned enterprises funding at the initial startup stage and allow private investors with technical expertise to manage and run the enterprises after a set period of time. The impact of well-structured and managed industrial clusters is job creation, developmental networks, skill acquisitions etc. The government can take for example Ajaokuta Steel Company and turn it around without political interference.

Cluster-based approached for a long period of time have already existing or dying industries in any region and attract both local foreign investment into that region if the right policies and strategies are deployed.

A deliberate effort by political leaders especially the Federal Government to make all regions viable economically. This can be done by equal distribution of economic networks and developmental infrastructures. Ensure that all the ports of entries in the countries are attractive and investment-friendly environment. For example, all seaports in Nigeria must made functional and put policies that encourage business and entrepreneurs to use it

Revolution Health System in Nigeria. Stop Medical Tourism and put policies that will encourage private and individual to build a functional health system. Take a critical look at our health system. And put a stop to our politicians always run away to overseers for minor health-related issues for treatment. That is a conduit pipe for siphoning public funds into the developed nations and leaving our hospitals and medical in decay situation for centuries. Those medical treatments abroad increase revenues to those nations they visit. Health workers and medical health owners and government of those nations are enriched while less privileged Nigerians die in poverty.

Policy inconsistency. This creates room for corruption and duplications. One government come and another come in and abandon an existing economic developmental policy. Not minding the impact and importance of it to the public.

The lack of transparency in governance breeds corruption, lack of accountability and inefficiency in the system. Open government activities to the public.

Inadequate power supply: Lack of consistent power supply have led to the closure of some small and large business and some have to shut down operations in Nigeria and relocate to our neighbouring countries, Ghana, Benin Republic and other African countries that business-friendly. Going forward, Solar power saves you money. The installation may be expensive but, in the end, it is cheaper. Solar power provides energy reliability. The rising and setting of the sun are extremely consistent all across the world. Solar power provides energy independence. Similar to the energy security boost, solar power provides the great benefit of energy independence. Again, the “fuel” for solar panels cannot be bought or monopolised. It is free for all to use.

It is with no doubt that the only solution to Nigeria’s epileptic power problem and how it causes great loss to both small and medium enterprises is for individuals and the Nigerian government to invest in renewable energy such as solar panels.

Develop and put the policy that favors local investors, businesses and entrepreneurship ideas by way

NWALI Tochukwu F,  CEO TD TRAVEL & LOGISTICS.

 

Vanguard

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