PREPARING EBONYI STATE FOR TOMORROW’S ZERO OIL ECONOMY - A LECTURE PRESENTED BY HIS EXCELLENCY ENGR. CHIEF DAVID NWEZE UMAHI, EXECUTIVE, GOVERNOR OF EBONYI STATE
PREPARING EBONYI STATE FOR TOMORROW’S ZERO OIL ECONOMY
BEING A LECTURE PRESENTED
HIS EXCELLENCY ENGR. CHIEF DAVID NWEZE UMAHI FNSE, FNATE
EXECUTIVE, GOVERNOR OF EBONYI STATE
AT THE OCCASION OF THE
59THFOUNDERS’ DAY CELEBRATION OF THE UNIVERSITY OF NIGERIA
HOLDEN AT PRINCESS ALEXANDRIA AUDITORIUM AND UNITY HALL, NSUKKA CAMPUS
DATED THIS 8TH OCTOBER, 2019.
I am very honored to have been invited to give this year’s Founders’ Day Lecture at this prestigious university. Coming a week after Nigeria celebrated the 59th Anniversary of her independence; it is noteworthy that, although the University of Nigeria was established in 1955, it was formally launched on 7th October 1960, exactly a week after Nigeria’s independence from Britain. As the University of Ibadan was originally set up as a college of the University of London, the University of Nigeria Nsukka is the first-fully fledged indigenous university in Nigeria and the first fully autonomous one. This university represents the hopes, aspirations, industry, unity of purpose and academic excellence of Nigeria as a country. It is no accident that it is the only Federal university with ‘Nigeria’ in its name. It is therefore entirely appropriate that a discussion of Nigeria’s future post-oil economy should be happening at this citadel of learning.
Since crude oil was first discovered in Oloibiri in today’s Bayelsa State in June 1956, Nigeria has largely relied on oil as its main source of income. In the same year, the American Geologist M. King Hubert predicted that oil production in the United States will peak between 1966 and 1972, and then begin a permanent decline. He was right. U.S. oil production peaked in 1970 and has been in decline since. In his book ‘The End of Oil: On the Edge of a Perilous New World’, the American journalist and author Paul Roberts estimates that since 1995, the world has used at least 24 billion barrels of oil annually but has only discovered 9.6 billion barrels’ new oil annually. At a consumption rate of 93 million barrels a day, the world is using more oil than it is finding in fresh fields. Estimates about when exactly the world will run out of oil or when the world would have partially or fully moved away from the use of oil vary between 20 years and 50 years. A pertinent question would be: If we can still rely on oil for the next 20 to 50 years, why are we worrying about it now? Why is the Governor of Ebonyi State worrying about preparing for a zero-oil economy of his state when he only has less than 4 years in office?
HISTORICAL BACKGROUND OF UNN
I will like to first of all convey my gratitude to the Vice Chancellor and the Management of the University of Nigeria (UNN) for considering me fit and proper to be the guest speaker in this 59TH Founders’ Day Celebration of the University of Nigeria, an annual event instituted by the University authority to commemorate the role played by the founders of the University of Nigeria Nsukka. To you all, I bring warm greetings from the Government and people of Ebonyi state.
From 1955 when the bill on the establishment of the University was passed to 1960 when the University was created, there were great Nigerians whose efforts contributed in making the creation of the Nigeria’s first indigenous University a reality.
This event no doubt, offers opportunity for every member of this University community, all lions and lionesses and indeed all well meaning Nigerians to reflect on the efforts of the founders of the University of Nigeria. My tribute first goes to the then Eastern Nigeria Government who set up a Provisional Council in April 1959 made up of Dr. Nnamdi Azikiwe, as Chairman, a distinguished Nigerian Lawyer Dr. T. Olawale Elias as member, Dr. Okechukwu Ikejiani, a medical practitioner who subsequently became Chairman of the Council of the University of Ibadan as member; and the Minister of then Eastern Nigeria, Chief Ibanga Agbabio and other UNN Provisional Council Members, which included Justice Chukwudifu Oputa, Dr. Usim Odim, M. A, Ugwu Egede, Prof J. A Nooneun and Dr. Kalu Ezra Odoho. The struggle for the creation of University of Nigeria was not an easy task as the intention of the colonial education was not better for the Africans. The kind of Education offered to Nigerians before the establishment of the University of Nigeria was such as could effectively nourish the colonial apparatus. What the students learnt was determined for them from abroad with little or no relevance to the needs of the students and the Nation, the degrees awarded by the university college Ibadan, were the degrees of the University of London with which it was in special relationship.
These considerations made the establishment of the UNN Founders Day Celebration an important event not only for the people of the south East but also for the Nigerian Nation.
It is noteworthy to mention that the opening of the University in 1960 which became the climax of the celebration marking the independence of Nigeria from the British Rule, was performed by Princess Alexandra of Kent who represented Queen Elizabeth II at the independence celebration. History has it that she laid the foundation stone of Princess Alexandra Auditorium (PAA) of this University.
It is also edifying to mention that the University of Nigeria Nsukka was uniquely patterned after the land-grate Universities of America, and was designed to be international in scope and cosmopolitan in outlook. But the courses of study were to be related to the day-to-day life of Nigerians and focus upon the social and economic needs of the nation.
It is gratifying to know that the University has towered in academics, human development and institutional expansion since its creation.
The University now has:
Three campuses – Nsukka, Enugu and Ituku Ozalla (College of Medicine)
19 faculties and one College of Medicine, 3 Institutes and 25 centres, and 8 institutes.
A student population of over 40,000 and an annual graduation figure of over 8000.
Recently invented an electric vehicle and energy generation from waste.
rapid expansion in the last five years with creation of thirty (30) new programs
Lions and Lionesses are competing favorably in the job market and a good number have become very successful in their careers, some of whom are my bosom friend and colleague, Governor of Enugu state, His Excellency, Rt. Hon. Ifeanyi Ugwuanyi, my leader and former Governor of Ebonyi State, Senator (Dr) Sam Ominyi Egwu, my good friend, the Governor of Central Bank of Nigeria, Mr. Godwin Emefiele, and erudite economic scholar, Professor Chukwuma Soludo.
The University authority deserves our commendation for holding the Founders’ Day annually.
Today the University still stands tall as one of the world’s best contemporary academic institutions for all scholars both in the character of its products and in the quality of learning. For this, I say kudos to all the Vice Chancellors who have reigned in this University especially Professor Charles Arinzechukwu Igwe, the visionary Vice Chancellor at whose instance I stand before you today.
WHY THE TOPIC: PREPARING EBONYI STATE FOR TOMORROW’S ZERO OIL ECONOMY
This topic otherwise captioned planning for the inevitable: “Ebonyi State must survive in a restructured Nigeria and in a Zero oil economy” is a wakeup call to all leaders of the various levels of government. Before I start, I wish to refer to the remarks by President Muhammadu Buhari, GCFR in a lecture titled “The Zero Oil Plan: Nigeria must survive in a world in which we sell oil no more”. He said “for over 50 years, the Nigerian economy has depended mainly on a single export product, crude oil, as its main source of National and government income. Crude oil has essentially funded almost everything in Nigeria-from the goods we import, the infrastructure we build, to our public sector wages. It has also provided the primary underlying support for our currency. While the obsession with oil may have worked in the past, Nigeria needs a very different economic paradigm for its future”. This is a great inspiration to leaders at all levels.
2.2 WHY I CHOSE THIS TOPIC AT THIS 59TH UNN FOUNDERS’ DAY CELEBRATION
When I was invited to make a speech in this event, I wondered about the most suitable topic that would suit the economic mood of the Nation, I wanted a topic that would provoke the thought of the eminent scholars in this great citadel of learning and task them on the philosophy of this University which is “to seek Truth, teach Truth and preserve Truth” and the mission statement which is “to place the University of Nigeria at the forefront of research and development, innovation, knowledge transfer and human resource development in the global academic terrain, while promoting the core values which will ensure the restoration of the dignity of man”.
I wanted a topic that would connect with the speech made by Sir. Dr. Nnamdi Azikiwe of the blessed memory to the first graduates of the University of Nigeria on the Alma Mater Night where he said “The concept of the University of Nigeria had its origin in the report of the International Bank mission and the Economic Development of Nigeria”. The essence of choosing this topic is to wake up all stakeholders to the reality that oil will one day fail us, and we therefore need to begin now to diversify and plan for the future of our people. Let me also quote Prof. Chukwuma Charles Soludo, CFR in his speech delivered at the platform on “Re-Designing the Nigerian Economy with New Ideas” on 1st October, 2019; where he said “Oil will be history in less than 20 years’ time but the pressures of peculiar demographics and geography are upon us”. This is the more reason why this topic is apt.
Countries like China, USA and the European Countries are now focusing on the future and the urgency of the complicating realities of oil economy in the midst of daunting climate change and technological innovations. As it is today, the European Union is projecting that 2050, wind and solar energy will displace energy generated from crude oil. This is aimed at tackling the climate change, international petroleum competitiveness and economic diversification. China is leading the world in the manufacturing of electronic cars and machines. All these technological innovations will surely crash the value of oil in the near future. There are probably 3 reasons why Nigeria needs to genuinely pursue zero-oil economy or diversification:
First is to insulate the economy from the risk of being vulnerable to a single commodity, as the different oil prices crashes have shown.
Second is to create jobs that can raise the living standard of an average Nigerian. Oil and gas jobs account for less than 1% of total employment and the young population can no longer be absorbed by the public sector.
Third is to prepare for life beyond the oil revenue.
Nigeria’s economy potentially lies beyond oil. In 1960, Nigeria had a leading position across several of its export crops especially groundnut, cocoa, cotton and palm oil. At that time, its share of the World Agriculture exports was in excess of 1%. By the mid 1980s however, Agriculture exports collapsed as the Country shifted towards petroleum exploration and by the 1990’s, Nigeria’s share in World export of Agriculture had declined to less than 0.1%
3.0 Before the Advent of Oil
Oil was discovered in Akata well which was drilled in 1953, but was suspended in 1956 due to its low quantity. In 1964, oil was discovered in commercial quantity at Oloibiri, now Bayelsa State by Shell BP (Tregene 1998: 64-72). Towards the end of the year, a second discovery was made at Afam, now in Rivers State. Over time, the number of both international and local companies prospecting for Nigeria Oil increased tremendously.
It must be mentioned that Agriculture was the dominant source of Nigeria’s economy right from 1950s, before the discovery of oil. Nigeria has favorable climate condition as it has mangrove region of the southern Nigeria with high rainfall per annum and supports the growth of palm trees, rubber and cocoa etc. the Savanna grassland in the North supports the planting of Cereals and leguminous crops such as Sorghum, Millet, Groundnut as well as animal rearing.
Indeed, Nigeria had an enviable record of food sufficiently before oil dominated the economy with a population of about 45.138 Million. Of note is the fact that palm oil from the South East became an export commodity as far back as 1958. The Niger Delta which now produces crude oil had become the major source of oil palm export 50 years before the advent of crude oil.
Agriculture provided 95% of the food needed to feed Nigerians, contributed 64.1% Gross Domestic Product and employed over 70% of Nigerian Population before oil began to be exported. At that time, Schools, including Universities acted as agent of socialization to uphold this social norm of farming in every school farm land. Nigerian Universities served their purpose as research centers, internally generating revenue for execution of University’s projects without unnecessary depending on Federal or State Government.
3.1 ECONOMY AFTER DISCOVERY OF OIL
At the time of our independence in 1960, Agriculture represented 64.1% of Nigeria’s Gross Domestic Product (GDP), while crude oil contributed only 0.3%.Tensions between Arabs and Israelis which culminated in the 1973 Arab-Israeli war increased the price of oil by 70% almost overnight. Data from the Central Bank of Nigeria shows that between 1971 and 2016, Nigeria earned more from oil than non-oil sources. This 45-year dominance of oil started to wane in 2016 but this was not necessarily as a result of increased efforts in non-oil sectors. In 2016, global oil prices crashed. Along with it, the value of the Naira crashed and Nigeria slipped into recession. Figures from the National Bureau of Statistic and the CIA Fact book show that, by the time of the recession in 2016, the contribution of Agriculture to GDP had fallen from 64.1% in 1960 to 21.2%. Although oil only contributed 10.4% to GDP in 2018, it represented 47% of the government’s revenue and more than 85% of its export earnings.
A major feature of Nigeria's economy in the 1980s, as in the 1970s, was its dependence on petroleum, which accounted for 87 percent of export receipts and 77 percent of the federal government's current revenue in 1988. Falling oil output and prices contributed to another noteworthy aspect of the economy in the 1980s—the decline in per capita real gross national product, which persisted until oil prices began to rise in 1990. Indeed, GNP per capita per year decreased 4.8 percent from 1980 to 1987, which led in 1989 to Nigeria's classification by the World Bank as a low-income country (based on 1987 data) for the first time since the annual World Development Report was instituted in 1978. In 1989 the World Bank also declared Nigeria poor enough to be eligible (along with countries such as Bangladesh, Ethiopia, Chad, and Mali) for concessional aid from an affiliate, the International Development Association (IDA).
Over the past five decades, we have essentially run a
Mono-product economy – entirely dependent, financed and operated, on income generated from crude oil exports. This undue concentration of our export has created vulnerabilities within the Nigeria’s economy, as fluctuations in international oil prices cascade deep across both Nigeria’s real and financial sectors. Over the past few decades, earnings from crude oil have accounted for between 65 percent and 70 percent of Federal Government revenues, and between 92 percent and 95 percent of national income.
On aggregate, 90 percent of the budgetary revenues of States in Nigeria are funded through allocations from the Federation (mostly oil), while only 10 percent is funded by internally generated revenues within States. The capacity for self sustenance in many States has therefore been largely unexplored.
This over concentration on a single commodity creates deep fault lines within the economy, as global oil price crashes travel through all facets of the Nigerian economy. Nigeria’s oil resources should be used as a down payment to build a robust diversified export basket of other products – to create jobs, earn foreign exchange and attract investments. Essentially, Nigeria must “use oil to move beyond oil” our large population of 180 million people means we do not have enough oil to meet the needs of all our citizens. A lower Nation with a lower population than Nigeria has oil reserves of 9,900 barrels per person (for each citizen), Saudi Arabia has 9,241 barrels per person; while Nigeria has only 214 barrels per person.
(Source: Trading-economies.com/ World Bank)
To translate this another way, assuming Nigeria produced all its proven oil reserves in one day and immediately distributed the financial proceeds to all its citizens, the maximum amount each person would receive is USD15,000 each, at USD 70 per barrel. In this scenario, after this ‘one time’ USD 15,000 cash distribution, there will be no oil for anyone.
3.2 BEST ECONOMIES
20 WORLD BEST ECONOMIES
According to the Legatum Prosperity Index, none of the 20 most prosperous nations on earth are heavily reliant on oil exports. Indeed, most of them do not produce any oil at all. Of the 10 most prosperous countries in the world, 5 have no oil at all. In 4 out of the 10, the contribution of oil to GDP is less than 1%. Nigeria is one of the 10 economies whose earnings from exports are most heavily dependent on oil. The others are Iraq, Libya, Venezuela, Algeria, Brunei, Kuwait, Azerbaijan, Sudan and Qatar; these Countries have much lower population than Nigeria.
Within the top 20 exporters, the non-oil exporters tend to be richer, have faster growth rate, and have economies that are more resilient. Nigeria therefore cannot expect to only stick to exporting oil, and become a major economic engine, or deepen the size and resilience of its economy. To transform Nigeria’s export agenda, the Zero oil vision lays out the partway for Nigeria to earn at least 20 percent of its GDP from non-oil export, or approximately USD 100 Billion.
The zero oil vision will require scaling up production in the country to unprecedented levels, and creating the necessary sourcing and marketing mechanisms to get Nigerian goods into foreign markets at competitive quality and price.
Developing countries in East Asia have been the best performers over the past decade, and witnessed the fastest export growth globally in implementing the zero oil plans. Nigeria should leverage her experience from East Asia and adapt practices that have worked to our specific situation
3.3 TEN BEST ECONOMIES
3.4 THREE BEST ECONOMIES
USA is the world largest economy by nominal GDP with a mixed (diversified) economy operating in a free market. She has biggest industries as tourism, international trade, Agriculture and aerospace with the major income to the government as “income tax and payroll taxes” from private individuals. She has her major exporting products as food, beverages and feeds amounting to $133 billion. She has the richest industry as Toyota motors ($254 billion). She is referred to as a “developed country” because she has sustained higher rate of real GDP over a long period of time. She also has a GDP of $21.2 trillion with the private sector as the highest employer of labour (over 13 million people). United States is referred to as a “1st world country” among others due to the high rate of her per capita income ($64,767). She has a GDP of $21.2 trillion ; hence an advance country.
China is the second largest economy by nominal GDP. The success in the economic growth of this country is attributed to the mixed (diversified) economy that is incorporated with limited capitalism. The leading industries are light industries (e.g. Foot wear, toys, food processing, electronics) and heavy industries (steel and iron, machine building, and armaments). Their largest economic sector is the agricultural sector which engaged about 618.66 million people with the tertiary sector as the highest contributor of the GDP. Also it is worth noting that China is not an industrialized country yet. Even as the highest manufacturer in the world, it remains a developing country and is a second world country because of her per capita income ($8,250.00).
Japan is the third largest in the world in terms of nominal GDP. She is also the world biggest creditor with the leading public debt ratio. She has the nominal GDP of $1,266.1 billion and GDP per capita of $49,500.00 with annual growth rate of 1.7%. Her major exports include electronic equipment’s and cars. Her greatest resources are their technology. The economy is a highly developed free-market economy. She is a 1st world country.
See the table below:(source: FAO,2004)
Purchasing power parity
1st, 2nd or 3rd world country
Growth Ratio (%per annum)
1st (Nominal GDP) & 2nd (ppp)
2.6 million people
67th(nominal GDP) & 73rd (ppp)
425 million people
3rd (nominal GDP) & 4th (ppp0
56536.13 thousand people
3.5 The Zero Oil Vision
The zero oil vision simply seeks to answer four basic questions regarding Nigeria’s economic future
What would Nigeria do if there is no crude oil to sell?
What else (other than oil) can Nigeria sell to the rest of the world to earn significant foreign exchange, and generate income for Federal and state government?
How do you ensure that these new exported goods create enough jobs, and private wealth; as well as improve the quality of living across Nigeria?
How quickly can we prepare our country for a time of zero oil regime?
These questions are essential to frame the journey of restructuring the Nigerian economy to ensure we earn the majority of foreign exchange form non oil sources (as against mostly crude oil today). A look at the top global exporters reveals, that only 3 out of the top 20 exporters in the world generate majority of their export revenues from crude oil.
I had the opportunity of Presenting at the 74th Session of the UN General Assembly and I spoke briefly on Climate Change. Nigeria has been very actively involved in the global climate change discussion from the beginning; from being a party to the UN Framework Convention on Climate Change(FCCC) in 1994 and ultimately its ratification in Kyoto Protocol in 2004.
Though we have been involved in Climate Change discussions, we are yet to make a conscious effort to stop depending on Oil. I noted in my speech that in the South East, Soil, gully erosion and Land slides are responsible for the widespread destruction of human, animal, plant lives; domestic, industrial and commercial degradation of arable lands, contamination of surface and ground water supplies, isolation of settlements and migration of Communities. Erosion has undermined the sustainability and preservation of food security.
The 74th session of the UN assembly adopted a committed approach of moving away from Oil to Solar, wind, hydro. Over 50% of the vehicles in Europe are hybrid and Asia is adopting the same thus electric automobiles have come to stay which has reduced their dependence on Oil.
5.0 CAN NIGERIA SURVIVE WITHOUT OIL?
There are great opportunities for non-oil sectors to grow and this growth has been visible since 2001. Of course, the changes cannot be that quick and the transformation cannot happen overnight. The country can develop different sectors by taking the important steps from the government’s side.
Credit access for small business
Opportunities for medium-size business
Modernization in agriculture sector
Development of textiles
Development of tourism and creative industry.
Independence of businesses and private sector participation in economic development
Reduction of the involvement of the government in economic production
Introduction of new opportunities instead of relying on traditional sectors only
Human Capital Development through education, capacity building and empowerment.
6.0 A RESTRUCTURED ECONOMY OF NIGERIA AGAINST ZERO OIL ECONOMY
It is crystal clear that a restructured Nigeria based on a zero oil economy will consequently transform into a Nation with a different constitution in which the exclusive list and concurrent list will look dramatically different from what it looks like today. The primary burden of governance, development and the general welfare of the citizens will rest squarely on the component states. The recent price crash of international oil prices, staring from June 2014, significantly constrained national earnings and slowed our growth, demonstrating once again, the vulnerability of building our economy only on oil. My vision is simple; to build a state economy that will thrive even when our income from crude oil goes to zero.
A restructured economy is a diversified economy. It will usher in the following:
Macroeconomic environment stabilization
Encouragement of youth development
Supporting high social standards
Fight against corruption at all levels
Foreign exchange rate improvement
Safety in public places
Better coordination between cities, states, and government
We must commend President Muhammadu Buhari GCFR, for his great success in the area of Agriculture in Nigeria, of which Ebonyi State has benefited immensely.
7.0 HISTORY OF EBONYI STATE CREATION
Twenty-three years ago there was no Ebonyi State. The struggle for liberation and self-actualization began in 1957 and culminated, 39 years later, in the creation of one of the two youngest states in the federation by General Sani Abacha on 1stOctober, 1996.
The Founding Fathers of Ebonyi State, notably, His Excellency, Dr Francis Akanu Ibiam, Chief Martin Nwancho Elechi, Dr Offia Nwali, Dr. Andrew Nwankwo, Chief S.O Mgbada and many others, brought so much pressure to be on their quest that the Willink's Commission report of 1958 summarised the depth of the agitation thus: "…feeling of neglect and wish for a greater share in roads, schools, hospitals and water supplies" would be assuaged through offering the agitators a degree of autonomy in the running of their own affairs.
Ebonyi State has a total land mass measuring 5,538Km2 with majority of it being arable land that supports the growth of rice and tuber crops. It is a homogenous community with a population of about 3 million people. The economy of Ebonyi State is predominantly driven by the middle class.
Two military administrators and three civilian governors have thus far governed Ebonyi State namely:
Navy Commander Walter Aye Feghabor(retired), who was the pioneer military administrator of Ebonyi State from 1996-1998, set up the take-off administrative structures of the young state. He also opened up the roads in the State Capital.
And Police Commissioner Simeon Oduoye(late) was the second and last military administrator of Ebonyi State. He continued what Faghabor did and midwifed the democratization process in 1999.
Dr.Sam Ominyi Egwu. The journey of development began in Ebonyi state with the advent of democracy in 1999 when the first democratically elected administration under the leadership of Dr. Sam Ominyi Egwu, which lasted between 1999 and 2007, came on board. Some of his achievements are free education, fight against guinea worm, opening of roads, Agricultural Development, empowerment and housing among others
On 29th May, 2007, the baton of power was transferred to Chief Martin Nwancho Elechi. He embarked on projects and programmes including eradication of Guinea worm, dualization of roads of capital city, water projects, attitudinal change initiative, agriculture and Centenary City among others.
From the foregoing, it is clear that as at 29th May, 2015 when we came on board as the third democratically elected government, the state was nowhere near the level of development envisaged by the founding fathers.
The coincidence of the most inclement economic recession in the history of our young state with my first tenure inauguration further compounded issues and made pundits believe that if all we could achieve at that time would be the payment of workers' salaries, we would indeed still be celebrated by posterity!
This was a realistic assessment of the economic crisis that made the hope of payment of workers' salaries a mirage, and reduced the promise of even a single capital project to mere wishful thinking.
8.0 THE ECONOMY OF EBONYI STATE
Ebonyi State has always been at the bottom in revenue receipt from the oil driven Federal Government economy.
Upon inauguration on May 29th 2015, we were conscious of the meager Federal allocation that accrues to the state and the total neglect and underdevelopment suffered by the State, we developed strategic plans for the economic growth and development of Ebonyi State along the 5-fold covenant God gave to me and they are:
To serve Ebonyi State with the fear of God
To prosper Ebonyi State with the word of God
To make Ebonyi State the No 1 Economy in the Country
To passionately help the widows and the oppressed
To build a befitting place of worship like Solomon did, so that any Ebonyian that is faced with any difficulty anywhere in the world and turns to the direction of the temple and calls upon the name of the Lord, God will answer that prayer.
Our administration, from day one is working on the premise that one-day oil will go or lose its value in the market. We are working on the stack reality that one day, Federal allocation will diminish or worse still extinguish and the world would have moved forward without oil. Ebonyi state does not have her oil reserve yet developed and does not enjoy 13% derivation.
In planning for tomorrow based on our conviction that one-day oil will become history, we focused on the following Programs: Solid Infrastructure, Agriculture, Solid mineral, Human Capital Development, Tourism, water Production, Entrepreneurship, Vocational Development, Education, Health, industrialization and Security as critical sectors that will drive our initiative on zero oil economy.
9.0 PREPARING EBONYI STATE FOR A RESTRUCTURED ECONOMY OR ZERO OIL ECONOMY.
Zero oil economy contemplates economy without oil. It is a process of shifting an economy away from oil source to other multiple sources from a growing range of sectors and markets.
This requires economic substitutes for oil and gas with the global technological trends and with the emergence of all other renewable energy sources. We need to look beyond oil in our quest to give meaning to the lives of our people. We need to have a zero oil plan as our strategy for economic recovery and growth. We need to plan to reduce dependence on oil as countries main foreign exchange. Oil has dominated the country’s economic space. Unfortunately, we don’t have control of the price and it can crash at anytime.
Therefore, at a time Nigeria’s major revenue earner crude oil is experiencing volatility in price at the global level, and cost of projects rising higher than accruable oil revenue, there is need to drive ambitions for strategic zero-oil policy to reposition the country’s economy.
Having said that, the truth is that Nigeria’s economy is no longer what it used to be at the early period of our independence as a country. The founding fathers of this University bequeathed to us an economy that was strong and competitive with other economies of the world. The East was a major producer and exporter of palm oil, the West was a major producer and exporter of cocoa, the North was a major producer and exporter of many agricultural produce especially groundnut in the world market. Insecurity and criminalities were low. The rate of Naira to Dollar was N5.41to a dollar. Today, oil makes over 80% of all the country’s revenue and the exportation of crude oil brings nearly 98% of all export earnings. Today, the rate of Naira to Dollar is N360.00 per dollar.
Statistics has shown that oil economy is not the greatest precursor of job creation, food security and general economic growth, instead it breeds low standard of living, it widens the gap between the poor and the rich and brings about economic imbalance and encourages unemployment. With a nation of over 180 million people, the only way out is economic diversification or zero oil initiatives by government. This is coupled with the fact that new technology is evolving, where engines or machines are manufactured to function without oil. There is pressure on Federal allocation; there is alternative energy source like solar and wind energy that may crash the price of oil.
10.0 PROJECTS AND PROGRAMMES OF EBONYI STATE AND IMPACT ON THE FUTURE OF THE STATE WITHOUT OIL
Around the world, the key driver of most non-oil economies is infrastructure. Good infrastructure facilitates the movement of goods and services, promotes economic growth and aids poverty reduction. According to the McKinsey Global Institute China spent 8.5% of its GDP on infrastructure between 1992 and 2011. 43% of China’s total investment is in infrastructure.
Enabling environment in our consideration includes; infrastructures, security, ease of doing business, task incentive, and investment opportunities. Ebonyi State that hitherto had worst road infrastructure among its contemporaries and the rural communities were cut off from the capital city. We had the worst Economy, our Poverty Index was very high and was the highest in South East; environment was poor; Private Sector investment was lacking and the State suffered Criminal neglect. That is why we have modest achievement as follows:
Constructed not less than 25-kilometres roads of concrete pavement (and in some cases bridges) in all the 13 Local Government Areas of the State, to enhance intercommunity trade and market accessibility.
Reconstructed Federal roads linking to the metropolis and about 500-kilometers in the capital city and satellite town of the State to enhance safety and movement of goods and services in the state.
Constructed the internal roads of the headquarters of the police command, the Army, the National Youth Service Corps, the Civil Defence, the SSS to give them the comfort required to discharge their duties.
Introduced road construction with concrete pavement of 8 inches, which we did over 300km roads, first of its kind in Nigeria with 50 years guarantee.
Built the biggest Ecumenical Center ever built by any government in Nigeria, with main boll of 10,000 capacity, about 2000 capacity smaller halls with modern lift, escalators, offices and accommodation to boost socio-economic activities, including spiritual revival.
Built the longest and most aesthetic flyovers in the South east with 3-number of such having a total of 96 span built in 3-years and has commenced another construction of 8 flyovers in strategic junctions and major highways of the 3 senatorial zones to attract investors.
Built a President Buhari light Tunnel with 29 spans, with aesthetic lights that shines in the night to make Ebonyi State investment friendly and promote night trading.
Built the most amazing and sustainable fountains/tourist attraction in the South East – 12 in number at strategic locations to promote the entertainment industry in the State.
Renovated our Stadium with ancillary work and guest house for accommodation of athletes and has ambition to construct one of the best stadium in Nigeria. Construction of new stadium is ongoing now in the State.
We are constructing the biggest shopping Mall that will be the microcosm of the macrocosm of the Dubai Mall, to create market and stimulate provision of goods and services. This Shopping mall will attract International trade and investment and shall create not less than 3000 jobs and generate thousands of wealth.
We are reconstructing Margaret Umahi International market in the South East to create opportunities for importers and exporters from Ebonyi State and beyond. The market is located at trans-Sahara road. This was started by Chief Martin Elechi.
Besides creating smooth road, the major streets are adorned with beautiful ornamentals to make the environment inviting. Each of the headquarters of the various Local Government Areas of Ebonyi State has 12 hours’ street light that cannot go off unless in rare cases. This is to encourage urban-rural migration and trade.
It is worthy to emphasize that my administration intends to make Ebonyi State a global village not only in terms of ICT but also in terms of road connectivity between the rural communities and the metropolitan city. In these four years of renewed tenure, we have started to construct modern twin flyover bridges of about 29 spans each twin in 8 major junctions linking the three Senatorial Zone, new Stadium, airport and teaching Hospital, with ancillary works.
Other special infrastructure being built by Ebonyi State Government under my watch is a Classical International Airport with 4 x 4.5km land area and with 3.5km runway, patterned after Lagos and Abuja Airport which will be one of the best in Nigeria, an Ultra Modern Stadium, all centrally located within the state to serve the investment needs of the State. These investments will create not less than 5000 direct and indirect jobs, attract investors, raise tourism potentials of the state and enhance the revenue generation capacity of the state. Guarantee safety in the wake of insecurity in the country.
Driven by our passion to lift the living standards of our rural people who constitute the highest number of our population, we are partnering with the Federal Government and the World Bank, under RAMP Programme to construct not less than 595km of Agricultural farm roads, 46km per Local Government to link up all the major communities, through Rural Access and Agricultural Market Project.
We are doing a ring road of 189 kilometers in partnership with African Development Bank (AFDB) to connect 9 Local Government Areas in the State with a target of providing access road for farmers and solid mineral dealers and thus boost economic activities across all communities. It is expected that not less than 100,000 of rural farmers and entrepreneurs will be involved in agric and solid mineral businesses within the local communities.
Abaomege flyover (18 spans) is designed and executed to decongest the traffic arising from much truancy that plough through Cross River State enroute our state to other parts of our country and thus encourage free flow of traffic and economic activities in the State. This will enhance businesses in the State.
Further our administration is dualizing 66km of Abakaliki to Afikpo Road and 48km section of Abakaliki to Enugu Road.
The following roads are either completed or ongoing:
15.5km Amasiri-Okposi Uburu Road.
25km Agbaja-Nwofe road
10km of Mpu-Uburu-Okposi Road -Dualisation
35km Obiozara-Onicha-Oshiri to Onueke Road
23km Amasiri to Okposi to Uburu road
16 km Nkalagu Road
18.8km Ikwo Road
14.5km Abakaliki- Afikpo Road
30 Km of Amasiri- Nguzu Road
35km of Ntezi - Isu Road
25km Abaomege - Ukawu – Ugwulangwu – Okposi Road
15 km Ezza North Road
10.5km of Ukwuachi Road
10km of Township- EBSU Road
5.8km Ikwo Rice Mill Road
15km Uburu Ring Road
8km dualization of Afikpo- Amasiri Road
7km of dualization of Kpiripkiri Road
10km of Uburu Internal Road
15.5km of Akaeze-Ishiagu Road
10.5k of Agba - Isu Road
30km of Ezzangbo – Effium Road
300km of rehabilitated Township Road
6km Onueke-Township Road, etc
We are constructing building material industrial cluster at Ezangbo in the North
We are constructing Industrial cluster for shoe making, textile making, manufacturing and production in Ishielu LGA in the Central Zone. We are developing 200 Hectares of Agricultural Production Cluster in the South.
We have created 3 Mineral buying center’s in the State.
Water and power supply are attracting huge attention under our administration. We have taken bold steps to rehabilitate the Ezillo Water Scheme, repair and rehabilitate the Oferekpe water Scheme, procure quality water pumps for Ukawu and Ezillo water treatment plant to enhance efficiency of the treatment plant, construction of Ivo and Uburu water are on-going. By the time we are through, water related businesses will be created.
Agriculture is the mainstay of our economy and has the propensity to provide employment and wealth creation to majority of both skilled and unskilled population of our state.
We have introduced entrepreneurship activities in Agriculture, in primary, secondary and tertiary productions value chain. Our target is to encourage agri-business.
We started by making farming compulsory for all public and civil servants and we had to declare one-man-one hectare programme to all elected and appointed people, including Civil servants.
This made Ebonyi State to emerge as one of the three largest producers of rice in Nigeria, we profiled over 53,000 farmers on rice production in 2016 and since then we have continued to increase the zeal of rice farmers and we gave them improved rice seedlings and other inputs, including soft loans.
We launched mechanization of agriculture wherein many modern farm implements such as tractors, threshers, tillers were procured and given to farmers. We already have a history of being a state with the biggest rice milling clusters in Africa, so we had to increase the tempo by rehabilitating 3 number 5 metric tons per hour capacity modern rice mills. We procured equipment and installed 3 number 3 metric tons per hour capacity parboiling plant to operate side by side with the rice mills. This has increased activities in the rice value chain and we propose that by 2020, every Local Government Area shall have a modern rice mill.
Cassava is the next priority crop in Ebonyi State. Apart from introducing hybrid vitamin A and C cassava stems, our administration procured for farmers, 4 numbers 5tons/hour cassava processing machines, including the machine for Cassava starch and flour. We have raised off-takers in the value chain of cassava produced from different communities of the State and other priority crops of the state.
The State Government under my watch saw the need to rehabilitate the existing fertilizer Plant in the state and set it to provide the fertilizer needs of the state in all farming activities. The plant which produces NPK of all types, now has the capacity to produce 40mt per hour. We have also built another brand new fertilizer plant with a capacity of 40 tons per hour capacity. This means that we have two sets of fertilizer plant with a combined capacity of 80TPH which produces all kinds of fertilizers for farmers in the South East, South South, North and also for the Federal Government.
We must commend Mr. President whose program on fertilizer not only crashed the cost of fertilizer from 8500 Naira per 50kg to between N5000 to N5500 per Kg but also made it available to the door step of every willing farmer.
Our administration also completed the establishment of mushroom factory which we copied from Abia State Government and expanded it to be largest mushroom farm in Nigeria.
In other to exhibit our agric produce, solid mineral potentials, we constructed a glass show room to serve as an exhibition centre for all our agricultural and solid mineral products.
Government also brought waste to wealth policy that makes household and agricultural waste to be useful, this brought the need for a pulverization Plant. A pulverization plant of 200TPH was installed by our administration thus plunging our government into resource recovery from waste. The plant recycles other agricultural bye products and wastes, thus aiding in the cleanliness of our environment and creating jobs for peasant farmers and small scale business men and women.
Introduction of Smart City in the Abakaliki Metropolis, where CCTV is mounted at strategic Junctions to monitor road users and track criminals to their hiding place
Constructed the internal roads of the headquarters of the Police command, the Army, the National Youth Service Corps, the Civil Defense, to give them the comfort required to discharge their duties.
Recruitment of over 400 Neighborhood Watch into the security architecture of the state, and are paid monthly and
Constitution of farmers Herders Committee and organizing regular interface with them to ensure that they live in peace.
Procured and distributed over 100 Hilux jeep to Security outfits in the state, including the Neighborhood watch and Forest Guards.
We believe that education drives diversification, our policy is targeted at raising the quality of education through training of teachers, provision of necessary facilities that will enhance education, such as good learning environment, free and compulsory education of Primary and Secondary School and introduction of School Agricultural programme to enhance interest in modern Agriculture.
This policy also powers the school feeding programme introduced by the Federal Government in the Primary Schools. Our administration also introduces Special Schools namely, Vocational School, Gifted Children Education, Vocational School for Agriculture and Adult School.
Vocational School is available as full time and part-time programme for talented artisans, technicians, craftsmen and youth who have passion for vocational programme but require formal training to be qualified to go into vocational businesses. The vocational school shall not only give certificate to the school leaver, it will also profile such persons for numerous State and Federal Government enrolment programme including the Central Bank of Nigeria (CBN) and Bank of Industry (BOI). We are targeting that not less than 30, 000 beneficiaries of this vocational education will be empowered fully before the end of 2023
The Gifted Education is available to children who are exceptional in academic performance, selected on equality basis across the Local Government Areas. Selection of these children is by a competitive selection process in which the best in class performance is selected per ward.
Government shall take care of all the cost of training of the gifted children from the point of entry to the point of graduation. They will be placed under good nutrition. It is a school for future leaders of the state. The teachers for the school are selected through Examination process.
Vocational Agric College is a school programme for our farmers, Civil Servants and those who have interest in agriculture but lack the requisite qualification and experience.
Mass Literacy programme is available for men and women who did not have opportunity of formal education.
We are presently pursuing a programme of out of school children with World Bank. By 2020, no Ebonyi child will be out of School.
By November 2019, we are injecting fresh N7.6 Billion Naira to School building, ICT, School Agric programme etc.
Under our administration, quality of education improved tremendously. We are no longer among the educationally less privileged. Ebonyi now occupies the 10th position in the WAEC and NECO performance since 2015 to date, but we want to be no 1. According to NUC performance index, a local government area in Ebonyi State came first among the 774 LGAs in Nigeria in terms of total number of students admitted in the various universities in 2017.
The Local Government Area which produced the highest number of students who got admission to study Medicine and Surgery in Nigerian Universities is said to be one of the LGAs in our state. This means that in future, education will add impetus to our economic development Agenda.
Note that under education and human capital Development, we emphasize training and retraining of entrepreneurs, technicians, craftsmen, farmers etc on business management, Agricultural best practice, mentorship programme for the youths and women. We have programme for the vulnerable.
We introduced reward system to encourage hard work, excellence and integrity. We have a principle that every person should have a second address, including the Civil Servants and politicians, training on ICT, professional discipline etc. and also a Stimulus Development Project.
10.6 ENTREPRENEURSHIP, INDUSTRIALIZATION AND HUMAN CAPITAL DEVELOPMENT
The State Government in it’s bid to empower the citizenry and raise their per capital income, introduced many micro, small, medium and large scale Enterprises and vocational programmes for the people of the State. The State Government has a comprehensive action plan to develop the youths, women, farmers, public servants, entrepreneurs, artists, technicians, not only financially, but also mentally and morally to have something doing so as to bridge the gap between the rich and the poor thus promote self sufficiency and self reliance among the people.
This is why the State Government profiled 3,000 youths and women living in Ebonyi State trained and empowered them with a total of N750m grant to go into businesses of their choice; Government introduced street to skill empowerment programme for Ebonyi indigenes who are hawking in the streets of Lagos and major cities of the country and empowered the first batch of 520 youths and women drawn on equality of local government areas with N130m. Over 53,000 farmers are given government loan or inputs to go into farming on yearly basis.
Since 2015, we have given to farmers and Civil Servants aid to farm in the sum of 12 billion Naira. Our target is that with average of N250,000 soft loan to each farmer and with the introduction of dry season farming, which makes for two farming seasons in a year, the farmers are cruising home with not less than N500,000 profit per annum, under the One-man-one-hectare policy of Ebonyi State Government.
The widows in Ebonyi are not left out in the empowerment schemes as 4,300 poorest of the poor widows were profiled, trained on business management and empowered with Four Hundred Million, Three Hundred Thousand Naira (N 400,300,000.00) grant to assist them go into agric business. Government trained and empowered 5008 Pastors and clergy with the sum of Five Hundred Million, Eight Hundred Thousand Naira (N500,800,000.00) for them to have a second address through Agric-businesses.
403 Wives of Security officials posted to Ebonyi state from the different security outfits were trained on business management and were empowered with Eighty Million, Six Hundred Thousand Naira (N80,600,000.00) for Agric businesses.
400 youths and women of Ebonyi state who were in the business of barrow pushing and degradable businesses, some of whom are in Onitsha Anambra State were trained on tricycle mechanics and repairs and empowered with 400 brand new TVS Tricycles to improve their living standard. Ebonyi youths and women who have interest in agric related transportation were profiled and given over 98 number Sienna buses to upgrade their source of livelihood, and help in evacuating agric produce from the rural areas.
Civil Servants are not left out in our empowerment policy as we have profiled 10,000 Civil servants for training and empowerments to enable them go into farming. Over 2.7 billion has so far been rolled out as soft loan to the civil servants with a policy that every Friday is a work-free-day for the civil servants involved. We just approved another N500,000,000 to be released for Civil Servants and another N500,000,000 to be released for the youths and women under the Ebonyi State Stimulus Development Project (EB-SDP), and we expect a matching grant from the bank of Industry (BOI). In this case, average of N500,000 and in some cases, N300,000 was accessed by these civil servants to invest in agriculture. It is hoped that this will encourage their fate in green colar jobs, instead of relying on the peanuts in the name of salary.
Note that under empowerment and human capital Development, we emphasize training and retraining of entrepreneurs, technicians, craftsmen, farmers etc on business management, Agricultural best practice, mentorship programme for the youths and women. We have programme for the vulnerable
Between now and the next three years, the state Government will raise 60,000 Millionaires through entrepreneurship development. Already, we have established Ebonyi State Stimulus Development Project (EB-SDP) which has profiled 5,000 youths and women for empowerment under this project.
10.7 SOLID MINERAL DEVELOPMENT
Ebonyi State is the leading State in the South East that have potential in Solid Mineral Development in Nigeria. We have lead ore (Galina), Iron ore, Granite, Black Marble, Coal, Salt, Limestone Quartz, Kaoline, Zink Ore, Quartz, Dolerite, Siderite.
These mineral deposits are by our policy to be driven solely by the private sector in order to maximize the potentials and value chain associated with it. What we did was to aggregate all the solid mineral classifications and generate a common template for investment in the solid mineral in Ebonyi State. Solid mineral in Ebonyi State has the propensity to generate not less than 50,000 jobs.
We already have many investors in our solid mineral industry which includes Bua Cement, Lafarge, Ibeto. Very soon the Nigercem that used to be the biggest cement industry in Nigeria will come back to life. Many jobs and businesses have been created through the solid mineral sector.
10.8 HEALTH AND HYGIENE
We have developed our primary health care system and made it accessible to the rural population.
We renovated 13 General Hospitals, 171 Primary Health Centres, including the College of medicine and we are building a brand new College of Medicine for Our State University.
We have contributed in the development of the General Hospital System for each of the LGAs
We have built the biggest Laser Fever and Virology centre
We are constructing emergency Hospital Projects at the Alex Ekwueme Federal Teaching Hospital, Abakaliki.
Power is very key to the development of our young State. We are mindful, that is why we pursue power generation to support our infrastructure. We do this with the mindset of Oil being history in the very near future. Presently, we run over 70 generators of capacities between 150KVA to 500KVA to power our street lights and Public Facilities in our capital City and our 13 local Government areas.
We have however completed the installation of 10 Nos 100 KVA solar Plant to replace some of the generators and also to assist some of our general hospital. We are exploring the opportunities in greater capacities of solar energy and hydro power to drive our economy. We however have entered into major Partnership with TCN which has guaranteed 60% of steady power daily in our State.
We are presently pursuing 30KVA solar plant in each of our 140 communities especially to market places, primary health centers and boarding schools. We are pursing the total replacement of our generator to solar energy while using public power as backup; by the deployment of this 10 sets of Solar plants earlier mentioned, our expenditure on diesel to power the State light has gone down; this is the reason we are pursuing zero diesel engagements in most of our state energy requirements.
We are constructing bridge of Oferekpe and Ndibe Beach to connect Cross River and turn the areas to tourist centres.
We are developing Nkpumaakpatakpa, Crocodile pond, Juju Hill , Nkpuruke Cave and our Salt Lakes, for our tourism industry among others.
Rail to connect the 13 LGA to the Stadium, the airport and to the College of Medicine will be constructed as time goes on.
10.12 FAMILY SOCCOUR AND UPLIFTMENT PROGRAMME/WELFARE MATTERS
Through the Pet Project of my dear wife, Her Excellency, Chief Mrs. Rachel Ogonna Umahi, the widows, the less privileged and the sick and helpless have received succor in different dimensions:
Launched campaign against FGM. The campaign has reduced FGM from 74.4% to less than 30%
Championed the domestication of VAPP law
Collaborated with USAID and UNFPA to treat women down with fistula.
Rehabilitated over 25 repaired fistula clients
Intervened to recover the moribund Agency for Mass literacy
1710 widows given #100,000 start-up grants
300 widows receiving monthly stipend
Building 172 houses for indigent widows
Creating awareness/treatment for breast and cervical cancer
Improving girl child education
Regular visit to hospitals and promoting mother and child health
Working with professionals to fight all forms of violence especially on women and girls
Promoting gender rights and full involvement of Women in governance
N58M monthly is released to cater for indigent families at the rural areas and Payment of Hospital bills for our mothers, Children and fathers who are not able to pay their bills.
11.0 THE CHALLENGES AHEAD
Climate Change and its effect on Agriculture.
High population Growth
Lack of interest by the youths
Politicization of government programmes
Hate Speeches and Social Media
12. MITIGATION MEASURES
For us to achieve Non Zero oil economy, the following recommendations will be important:
Government at all levels should urgently create an enabling environment that will favour diversification of the economy that will de-emphasize mono-economy system and pay more attention to heterogeneous economy.
There is need to empower the Bank of Industry, Bank of Agriculture and other Development banks to create soft loans for farmer and entrepreneurs.
Grants, subsidies and incentives should be made available to entrepreneurs and farmers and market shall be provided for the goods and services provided by the farmers and entrepreneurs.
There is an urgent need to introduce at all levels mechanized system of agriculture to increase productivity and to reduce strenuous human labour and drudgery.
All the agricultural research institutes, school of agriculture, and reintroduce farm settlements and other river basin authorities should be revived to encourage massive production of agricultural produce.
We should discourage politicizing implementation of agricultural projects.
Sensitization is key.
Ladies and gentlemen, given that the most prosperous nations in the world are not dependent on oil, it is clear to me that, with proper investment in physical and human development, Nigeria can survive without relying on oil and may even grow faster. One way to do this would be to ensure that all revenues from oil are applied only to infrastructure development. It is sub-optimal for Nigeria to be using its oil wealth to fund recurrent expenditure. This promotes a dependency culture that stifles innovation, creativity and productivity. It also encourages a bloated governance system with the attendant high cost of governance. If we are to insist that recurrent expenditure must be funded from non-oil revenue, it will focus the minds of governments a lot more and drive productivity. It will also make the imperative to improve tax collection more urgent, which will in turn drive accountability as citizens start to ask what is being done with the taxes they pay.
In Ebonyi, we have started preparing, as Confucius advised. The journey will be a long and difficult one but we are laying the foundations for sustained economic growth and prosperity in our state, beyond the era of oil. We have made the modest strides we have made in our state through a combination of prudence, preparation for the future and diversification of our economy beyond oil. We stretch out our hand in partnership to everyone that is willing and able to partner with us on this journey, including this reputable university.
In all, the most outstanding legacies our government will want to leave will be in lifting over 60,000 Ebonyians out of poverty with Profit and a Capital base of N1M each. This means that 60,000 Ebonyians will have a cash profit balance of 60Billion Naira by 2023.
We invite you to come and be part of this exciting phase of our development. We invite you to Ebonyi State where our welcome is always warm, our food is always tasty and our future is full of promise.
God bless the University of Nigeria. God bless Nigeria