Perchstone & Graeys 2011 Annual Law Series By Dr. Shamsuddeen Usman Minister of National Planning 05 May, 2010 ACHIEVING CONSISTENCY IN PLANNING, POLICY

Perchstone & Graeys 2011 Annual Law Series

By

Dr. Shamsuddeen UsmanMinister of National Planning

05 May, 2010

ACHIEVING CONSISTENCY IN PLANNING, POLICY FORMULATION AND IMPLEMENTATION IN TIMES

OF POLITICAL TRANSITION

•Nigeria’s potential for strong economic growth is well recognized.–Biggest economy in West Africa- 41%

of regional GDP. –Second largest economy in Africa-14%

of GDP–Africa’s largest domestic market–Significant growth potential in tourism,

telecommunications, manufacturing and technology. 2

1. Introduction

– Nigeria’s Abundant Resources• Human resources

– Africa’s most populous nation (150 mn) – Youthful population (median age: 18.63 yrs.)– Low cost labor

• Natural resources– Gas (6th largest reserves in the world)– Natural gas reserves at least 2.8 trillion cubic metres.– Petroleum (8th largest producer in the world)– Oil reserves estimated to be 36 billion barrels; – 34 solid minerals (tin, iron ore, coal, columbite, copper, lead,

zinc, limestone, niobium, etc)– Significant uranium deposits.– Huge arable land suitabke for cocoa, peanuts, palm oil, corn,

rice, sorghum, millet, cassava, and yams etc).– Over 44 exportable commodities 3

1. Introduction

– With abundant resources, Nigeria should be among the most competitive economies in the world.

– This is however not the case as over 50 years after independence potential not fully realized

– But what went wrong?: – A major reason: Lack of Planning and Inconsistency in policy

formulation and implementation– Economy started well at independence

• GDP growth of 9.4% between 1962-1975• Poverty rate, about 48%• Functional and efficient infrastructural facilities• Nigeria major exporter of several cash crops• Efficient and committed Public Service attracting Nigeria's best• Favorable Human Development Indices.• Nigerian Universities and graduates among the best in the world.• This period witnessed 4 consistent National Development Plans implemented

across different administrations.• All that was needed to sustain progress:

– Consistency in policy, planning and implementation – Maintaining, expanding and modernizing human and physical infrastructure.

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2. Importance of Planning and Consistency

– Next 3 decades witnessed the abandonment of proper planning and implementation

– Economic progress truncated and reversed for next 3 decades by subsequent military governments and a civil war.

– Policy Vacillation: Each new government presents new agenda and discards the program and policies of predecessor.

– Result:• Dancing in the dark: Going round and round in circles.• Leadership position in several cash crop production lost.• Increased inefficiency in public service• Deterioration and near collapse of most infrastructure• Breakdown of rule of law• Tolerance for greed and corruption• Regression in economic fundamentals

– Negative GDP growth between 1975-1999– Rise in poverty to 70%– Rise in unemployment to 19.7%– Capital flight and decline in FDI: FDI concentrated in few sectors 5


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• Countries at same level in 1960 left us behind– Indonesia with similar vacillations in administration continued to

grow due to consistency in planning, policy formulation and implementation

– Culture of planning and policy continuity in China and India– Nigeria: NEEDS, Vision 2010, SAP etc either not fully implemented

or abandonedCountry Years of

consistent strategic planning

GDP per capita US$ Poverty Rate %

1975 1999 1975 1999

Malaysia 45 808 14,800 65 8

India 55 430 2,420 58 36

Singapore 40 2,505 27,597 - -

Indonesia 40 1,504 2,046 60 14

Nigeria 15 454 325 47 70


• Return to proper planning and consistency in policy formulation and implementation since 1999

• Last 3 administrations maintained largely similar programs and policies

• Results:– Relative financial and macroeconomic stability– Relative political stability– Removal from the list of uncooperative countries– Favorable international ratings maintained– Entrenchment of democracy and good governance– Average GDP growth rate of 7% since 1999– Nigeria now one of the fastest growing economies in the world

and expected to continue into the near future.– Gradual improvement in the way citizens see themselves, their

country and their government• Eg recent elections and participation of public• Increase in home remittances


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–International Community excited at Nigeria’s progress and prospects.

–Various positive reviews from Harvard Business Review, Standard and Poors, Fitch, UNCTAD, Renaissance Capital, Citibank etc

–Policy consistency enabling Nigeria to attract more FDI though still dominated by the Telecoms and Oil and Gas sectors. (eg. Policy on exchange rate stability adopted by last 3 administrations)

–Policy consistency also attracting domestic investment.


• Consistency maintatied under GEJ

• Nigeria’s Vision 20: 2020 (NV2020)– Vision to be among top 20 economies by 2020, anchored on 2 specific

targets, by 2020:• GDP of not less than US$ 900 billion• Per Capita Income of not less than US$ 4,000

– Discipline, consistency and conformity of policies, priorities, programmes

over long term.– Achieve high levels of investment and growth– Growth that is job creating, people-centred, pro-poor, and all-inclusive– NV2020 is to be implemented through three medium term development

plans– First Medium Term Plan (NIP 2010-13), anchored on 2 specific economic

targets by 2013• GDP of not less than US$344 billion• Per Capita Income of not less than US$2,008

– Plan has been approved following validation and sensitization9


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• Critical Policy Priorities– Intensifying the war against Corruption– Expansion of investment in critical infrastructure– Fostering private sector powered, non-oil growth to build

the foundation for economic diversification– Investing in human capacity development to enhance

national competitiveness– Entrenching merit as fundamental principle and core

value– Addressing subsisting threats to national security– Deepening reforms in social sector and extending

reforms to sub-national levels

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•Close attention paid to What Went Wrong and What We Need to Do Differently– No commanding heights– Government as an enabler and catalyst– Review of polices, programmes, projects.

• Continuing Reforms– Petroleum sector Deregulation-PIB– Power Sector– Public Service– Governance and Institutions

• Rule of law• Anti-Corruption• Electoral Reform

– Removing Binding Constraints


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•National Plan- incorporating State's plans– Respects Separation of Powers– Mutual Cooperation

• Common template• Common Performance indicators and measurement• Need for synchronization

– Same macroeconomy– Common security and governance issues– Need for zonal/regional development cooperation.

•What May Not Appear to be so Explicit– Importance of Security & Rule of Law

• Critical to sustenance of both political and market systems.• Very important but treated outside the NIP• Electoral reform• Police reform• Security of lives and property.


3. Is NV20:2020 Feasible

• Strong growth for Nigeria in last 2 years compared to most competitors for top 20 slot

• Nigeria has moved from 41st in 2008 to 37th in 2009 to 31st by end of 2010 (ppp based). (6 steps in 1 year and 10 steps in 2 years).

• Trend of strong growth is expected to continue.• Growth has been across all sectors of the economy accelerating.

– 6 key sectors growing in double digits for last 5 years• Solid Minerals, Telecommunications• Wholesale and Retail Trade• Building and Construction• Hotels and Restaurants and Real Estate

– Other sectors growing close to double digits– International forecasts place Nigeria as the fastest growing economy

between 2010-50 (8.5% on average)Country Growth rate %

Nigeria 8.5

India 8.0

Iraq 7.7

Bangladesh 7.5

Vietnam 7.5

Philippines 7.3

Mongolia 6.9

Indonesia 6.6

World’s fastest growing economies, average real GDP

Growth 2010-50Citi Bank

* Note only 2 of current top 20 economies in the list of fastest

growing economies


• Telecommunications sector has been growing comfortably well into double digits.– Huge growth potential still exists in the sector.– Mobile subscriber penetration at just about 50 per cent in 2010

• Agriculture has been growing by close to double digit for last 10 years. – Still largely small-holder, peasant agriculture. – Imagine the prospects when we finally complete the

transformation to commercial agriculture.– A lot of work ongoing in this regard.

•Wholesale and retail trade growing well into double digits for last 5 years.


– Average GDP growth of 7% over last 10 years especially in the last 3 years • Despite the global economic crisis and domestic infrastructural constraints,

including power, as well as other challenges which are being addressed.• Imagine prospects for manufacturing and other sectors when we get

infrastructure, including power right.– 2010/2011 budget proposal is focused on infrastructure.– Presidents power roadmap– Several power and infrastructure related projects in 2010 and 2011 budget proposal.

– Nigeria is 23rd recipient of FDI in 2010• Despite infrastructure, land tenure and security related constraints contributing to

low “ease of doing business” ranking. • Imagine prospects when we get the above right under NV20:2020.

– Imagine opportunities from other untapped sectors which NV202020 identified as growth drivers.• Country still growing at 7% without exploiting these sectors.• Strategies to tap these sectors all contained in the NV20:2020 and 1st NIP

bleprints.


• Demonstrated Commitment by the President.• Mr. President played integral part throughout• Consistency and continuity evident; last 3 Administrations have maintained the same

Vision• Directives on Capital Budget• Synchronization of 2011 budget with NIP• M& E Department to ensure tracking and accountability.

• National buy-in by all stakeholders irrespective of class, political affiliations, gender or academic background– Blueprint followed a massive national inclusive format.

• Over 5000 Nigerians involved• 29 Thematic groups, 12 special interest groups, all MDAs and State

Governments.

– Communication plan ongoing.– MDAs have bought into the plan: Ministries of Health and Education

NV20:2020 bases Master plans. Defense and other Ministries to follow.

4. Critical Factors for Consistency in Development Planning

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•Successful implementation of sectoral policies and programmes requires independent tracking of inputs, output and outcomes.

•Consistency requires institutionalization of the programmes and polices.– Robust M&E framework developed and approved

by the FEC.– Similar M&E system to track implementation of

states plans– NPC mandated by law to produce M&E reports– M & E Department created in NPC.– First report covering 2010 completed.


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•Development planning legislation– “A Bill for an Act to make Development Planning

Compulsory for All Tiers of Government in Nigeria, 2009” has been prepared to ensure consistency in the implementation of the plan among different levels of government.

– Must be passed by the National Assembly and the State Houses of Assembly.

– Bill makes it compulsory for this and all subsequent governments to fully implement NV20:2020 .


In conclusion….

“A vision is not a prediction of the future. By envisioning a desired future, we can work with the intention to create it”,

- Sandra Pastel

“The future will be shaped by what we do in the present. We just have to decide what kind of future we want – and create it”

- Mike Wallace

Conclusion

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Thank You All

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Documents

Perchstone & Graeys 2011 Annual Law Series By Dr. Shamsuddeen Usman Minister of National Planning 05 May, 2010 ACHIEVING CONSISTENCY IN PLANNING, POLICY